Latest updates

Anti-money Laundering Regulations for unregulated investment and insurance entities to take effect
  • Cayman Islands
  • December 18 2017

Under new anti-money laundering legislation, the list of activities classed as relevant financial businesses has been expanded. Unregulated investment funds and some insurance entities have now been given a grace period until May 31 2018 to establish anti-money laundering compliance programmes. This is a welcome move, particularly for unregulated investment funds which were not bound by the preceding regulations and therefore may not have policies and procedures in place.

Recent Serious Fraud Office investigations
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • December 18 2017

In July 2017 the Serious Fraud Office (SFO) opened investigations into the oil services company Amec Foster Wheeler Plc and the Rio Tinto mining group. One month later, the SFO announced that it would investigate corruption allegations against British American Tobacco Plc. Although the SFO did not give any further details, the tobacco giant had announced in February 2017 that it was investigating claims that it had bribed officials in East Africa to undermine anti-smoking laws.

Anonymity: Khuja v Times Newspapers Limited
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • December 18 2017

In July 2017 the Supreme Court published its judgment in a case concerning the reporting of an individual's name, which had been mentioned during trial proceedings to which he was not a party. The individual had been arrested in respect of similar offences for which others were on trial, but a charging decision over him had not been made before the trial's commencement.

Nigerian Securities and Exchange Commission under pressure
Sofunde Osakwe Ogundipe & Belgore
  • Nigeria
  • December 18 2017

Following media reports accusing the Nigerian Securities and Exchange Commission director general and two other senior officials of serious financial impropriety, the Federal Ministry of Finance recently announced the suspension of the accused officials pending investigations into the accusations. Regardless of whether the allegations are true, the commission has come under pressure in the past two years due to an increase in the number of market crises, which critics have attributed to failures in oversight.

Fallout of FATF mutual evaluation report on Switzerland
CMS von Erlach Poncet Ltd
  • Switzerland
  • December 04 2017

In the aftermath of the fourth mutual evaluation of Switzerland's dispositive to combat money laundering and terrorist financing by the Financial Action Task Force, the Swiss Financial Markets Supervisory Authority recently published a draft amendment to its Anti-money Laundering Ordinance. The amendment will result in a significant increase of compliance work for all financial intermediaries.

New rules for punitive administrative proceedings in capital and financial markets
  • Brazil
  • November 27 2017

The president recently approved in full a bill passed by Congress that will substantially change the existing punitive rules for crimes and misconduct carried out within the capital and financial markets. The new law introduces some relevant changes to the rules through which the Central Bank and the Securities Commission may punish offences and to the definitions and scope of application of certain financial crimes and wrongdoings, such as insider trading and market manipulation.

Gift giving in corporate Japan: US Foreign Corrupt Practices Act considerations
Nagashima Ohno & Tsunematsu
  • Japan
  • November 20 2017

Japan's spirit of omotenashi (ie, hospitality) encompasses many aspects of Japanese culture and etiquette, including the practice of gift giving. Many Japanese companies invest heavily in nurturing long-term business partners and, as such, the practice of giving gifts to business partners is relatively common. However, a number of risks may arise in this regard under international anti-corruption legislation, particularly the US Foreign Corrupt Practices Act.

New Anti-money Laundering Regulations come into force
  • Cayman Islands
  • November 20 2017

The government recently adopted updated Anti-money Laundering Regulations. The regulations demonstrate the Cayman Islands' ongoing commitment to comply with the highest international standards on combating money laundering and terrorist financing and aim to ensure consistency with the Financial Action Task Force 2012 recommendations. The move is part of an overall update of the territory's anti-money laundering regime.

Government signs agreements with United Arab Emirates to combat corruption and money laundering
Sofunde Osakwe Ogundipe & Belgore
  • Nigeria
  • October 09 2017

President Buhari recently signed a number of agreements with the United Arab Emirates concerning extradition, the transfer of sentenced persons and mutual legal assistance. This is one of the first concrete steps that Buhari has taken to combat corruption and money laundering since taking office. According to reports, the government is seeking to use these agreements to effect the seizure of real estate in Dubai which allegedly belongs to the former petroleum minister.

DOJ announces one of largest False Claims Act recoveries concerning government small-business programmes
Hogan Lovells US LLP
  • USA
  • October 02 2017

Two recent cases before the Department of Justice (DOJ) have sent a signal that the DOJ may become more proactive in combating small-business contracting fraud. These cases underscore the importance of ensuring that small-business eligibility representations are accurate, as the penalties for misrepresentation can be severe.

Compliance management system can lead to reduction in fines
CMS
  • Germany
  • September 18 2017

The Federal Court of Justice recently decided for the first time that the establishment of a compliance management system designed to prevent breaches of the law can reduce fines in accordance with the Administrative Offences Act. The court pointed out that even the optimisation of a compliance management system following compliance breaches can lead to a reduction in fines and provided guidelines for the measures to be taken in such cases.

High court issues non-conviction-based forfeiture orders
Sofunde Osakwe Ogundipe & Belgore
  • Nigeria
  • August 28 2017

The Economic and Financial Crimes Commission recently succeeded in obtaining two final forfeiture orders of property without there having been a prior conviction. It will be interesting to see how these orders are addressed if any contested applications for non-conviction-based forfeiture orders come before the courts, as neither case set out the grounds that empower the courts to make such orders.

Update on investigations into Eurasian Natural Resources Corporation
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • July 31 2017

Judgment was recently handed down in respect of the Serious Fraud Office's claim for a declaration that documents generated in the course of an internal investigation into the Eurasian Natural Resources Corporation were not subject to legal professional privilege. The judgment clarifies that because investigation and prosecution are not part of the same amorphous process, documents generated in the investigation phase do not, by default, benefit from the protection of litigation privilege.

Fraudsters sought to con HMRC out of £10 million
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • July 31 2017

A group of alleged fraudsters are being prosecuted after stealing personal details from the Civil Service Sports Council membership list and using them to fraudulently claim tax credits. Separately, research has found that one in five victims of identity fraud between 2012 and 2015 were company directors. In particular, criminals are using publicly available data from Companies House to target these individuals.

Retrospective application of Prevention of Money Laundering Act
  • India
  • July 24 2017

The Karnataka High Court recently issued a judgment which dealt with the retrospective application of the Prevention of Money Laundering Act 2002. The court held that a person cannot be tried for an offence under the act for the period when the offence was not inserted in the schedule of offences under the act. This would deny the writ petitioner the protection offered by Article 20(1) of the Constitution.

Criminal Finances Bill receives royal assent
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • July 24 2017

The much-debated Criminal Finances Bill recently received royal assent, becoming the Criminal Finances Act 2017. When it comes into force, the act will introduce significant amendments to the Proceeds of Crime Act 2002. From a corporate crime perspective, the most noteworthy of these changes are the introduction of the new corporate offence of failure to prevent the facilitation of tax evasion, revisions to the suspicious activity reporting regime and the creation of unexplained wealth orders.

Charges against FH Bertling
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • July 24 2017

Charges in respect of corruption offences under Section 1 of the Prevention of Corruption Act 1906 and Section 1 of the Criminal Law Act 1977 were recently brought against the UK subsidiary of German logistics company FH Bertling and a number of its former employees and other individuals associated with the company. The offences are said to have primarily enabled FH Bertling to retain or win contracts for the supply of freight forwarding services to a North Sea oil exploration project.

Recent Libor acquittals
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • July 17 2017

Following a six-week retrial, Stylianos Contogoulas and Ryan Reich, both former traders at Barclays, were recently acquitted of charges of conspiracy to defraud in relation to their involvement in London Interbank Offered Rate manipulation. The pair had first been tried alongside four others in April 2016. While their co-defendants had been convicted, the jury was unable to reach verdicts in relation to Contogoulas and Reich.

Recent enforcement developments
Arnold & Porter Kaye Scholer LLP
  • United Kingdom
  • July 17 2017

The long-awaited Criminal Finances Bill recently received royal assent, creating the new wide-reaching offence of corporate failure to prevent the facilitation of tax evasion. In other news, given the outcome of the general election, it is unclear whether the prime minister will continue with plans to abolish the Serious Fraud Office. Further, the Financial Conduct Authority recently obtained a decision which limits the identification principle in respect of its statutory notices.

Application of Foreign Corrupt Practices Act for energy and natural resources companies
Hogan Lovells US LLP
  • USA
  • July 17 2017

For energy, mining and resources companies, the cost of corruption – and getting caught – is real. Energy and mining companies, along with other resources companies, remain a major focus of bribery and corruption investigations worldwide. The government wields a potent weapon against bribery and corruption in the form of the Foreign Corrupt Practices Act.

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