Fair Finance Watch / Inner City Press
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March 31, 2008
From last week's LA Times: " Overall, it is nearly impossible to distinguish funds meant for potential terrorism from legitimate transactions, said a senior State Department official, who, like some of the those interviewed, spoke on condition of anonymity because of prohibitions against commenting on the record on counter-terrorism." What prohibitions?
March 17, 2008
So how did Eliot Spitzer get caught? North Fork Bank, recently re-branded Capital One, filed a Suspicious Activity Report last July. Like most SARs, it went nowhere. Until HSBC filed its own, about transactions with shell companies QAT International and QAT Consulting Group, connected to Emperor's Club VIP. Now investigators took an interest, tracing back to Spitzer. Why was he banking with North Fork, of all places?
March 10, 2008
Barclays has been contacted by the Department of Justice and the New York district attorney with questions about payments made in dollars through its New York branch. The payments may have been made by people or companies from states which are on the U.S. blacklist of nations it believes sponsor terrorism. The probe referred to in Barclays' notes to its annual 2007 results on February 19, where it warned "the potential financial effect of any resolution could be substantial''.
ABN Amro was fined $80 million in civil penalties in 2005 for transactions through its New York offices which the U.S. government said failed to meet the necessary controls on money laundering. RBS said in its annual results published last week that ABN is the subject of an ongoing criminal probe by the DoJ over the same issue. Negotiations over a possible $500 million settlement are ongoing, RBS said.
HSBC yesterday noted in its results that it has a "small representative office in Tehran''. HSBC said it recognized that should it break the U.S. rules on sanctions, there would be "serious legal and reputational consequences''.
March 3, 2008
A Singaporean citizen and 10 companies she owns have been targeted under new US sanctions aimed at the Myanmar regime. Cecilia Ng is married to the incongruously-named Steven Law, whose father Lo Hsing Han is "known as the 'Godfather of Heroin'," according to the US Treasury Department. The department's Office of Foreign Assets Control (OFAC) said in a Feb. 25 notice that Ng, born in 1958, is a Singaporean citizen who owns 10 companies including Golden Aaron Pte Ltd. State media in Myanmar reported in December 2004 that Singapore's Golden Aaron Pte Ltd was part of a consortium that signed an oil and gas exploration contract with military-ruled Myanmar. OFAC listed Ng's other companies as including: G A Ardmore Pte Ltd, G A Capital Pte Ltd, G A Foodstuffs Pte Ltd, G A Land Pte Ltd, G A Resort Pte Ltd, G A Sentosa Pte Ltd, G A Treasure Pte Ltd, G A Whitehouse Pte Ltd, and S H Ng Trading Pte Ltd. Ng could not be immediately contacted for comment on the allegations. A woman who opened the locked door at Ng's offices in Singapore's business district to AFP said she was not there. A plaque visible through the door listed Golden Aaron, S H Ng Trading and another firm, Kokang Singapore Pte Ltd. The Monetary Authority of Singapore (MAS) said, "our rules are vigorously enforced. Should there be links with illicit activity, MAS will not hesitate to take necessary action." No mas!
February 25, 2008
The story of the week was Germany's payment for a CD-ROM of its citizens with money in Lichtenstein. Enabling tax evasions as an act of war? And what of Lichtenstein's posture at the UN of being in favor of international law? And what of the multi-million dollar penthouse owned by Lichtenstein, on 40th Street and 2nd Avenue, and the diplomats regaled there?
February 18, 2008
U.S. proposed rules requiring government contractors to report any fraud of $5 million or over that they find have a gaping loophole: they specifically exempt "contracts to be performed outside the United States," according to a notice published last month in the Federal Register. Can you say, for example, Lockheed Martin?
February 11, 2008
Now the Credit Union National Association says the emperor has no clothes: Section 326 of the USA Patriot Act requires institutions to check "a list of known or suspected terrorists or terrorist organizations issued by any Federal government agency and designated as such by Treasury in consultation with the Federal functional regulators." But did the federal government ever issue a Section 326 List? "To date, no such list has been issued," says Valerie Moss CUNA's director of compliance information....
February 4, 2008
More Russian action -- The Central Bank of Russia (CBR) has revoked the banking license of Moscow-based Industrial Development Bank (IDB), the CBR said last week. The CBR said that the bank had repeatedly violated the federal law on the prevention of money laundering and financing of terrorism. IDB also did not report to the Federal Service for Financial Monitoring on transactions subject to obligatory reporting and made other violations, the CBR said. The CBR has appointed a provisional administration to run the bank until an arbitration court rules to declare it bankrupt or to appoint a liquidator of the bank.
January 28, 2008
While the UN Development Program operated in North Korea, government officials monitored UNDP's communications and searched its employees' houses, according to a Senate report release Wednesday night on the eve of testimony by UNDP and other United Nations officials. The report, co-issued by Democrat Carl Levin of Michigan and Republican Norm Coleman of Minnesota, largely confirms the charges leveled over the past year at UNDP for its North Korea programs: that UNDP paid workers' salaries directly to the government in hard currency, had only limited access to sites of projects it funded and no access to its own bank accounts, and paid a vendor asserted by the U.S. State Department to be involved in Kim Jong-Il's weapons programs. The specifics about wiretapping and unannounced searches are new, as are some of the details about the flow of UNDP's funds through Banco Delta Asia, a Macao institution later frozen as a money laundering concern.
January 21, 2008
From U.S. Congressman to stealth diplomat for Ban Ki-moon to Khartoum, to indictment for money laundering -- the story of Mark D. Siljander needs to be further probed. "UN Adviser on Sudan Charged with Terror Money Laundering" -- it's a headline the first part of which the UN would be sure to object to. But from LA Times: "He offered voluntary, informal advice," said the senior U.N. official responsible for coordinating the meetings, who spoke on condition of anonymity. Developing...
January 14, 2008
BB&T Corp. recently paid the U.S. government $10,000 to settle allegations that it allowed funds to be withdrawn from an account held by a known terrorist. The Treasury Department's Office of Foreign Asset Controls says BB&T permitted an automatic debit "against an account held for a specifically designated global terrorist," and did not voluntarily disclose the matter. Question: so BB&T got fined only $10,000? Some deterrent...
On another front, currently the U.S. Foreign Sovereign Immunities Act permit such suits only against countries that the State Department has named state sponsors of terrorism. One theory likely to get attention now is whether Saudi Arabia's alleged money laundering for Al Qaeda counts as commercial activity, which falls under an exemption to the Foreign Sovereign Immunities Act...
January 7, 2008
Regulators to bankers, at the FRBNY: "Since the FBI considers SARs to be like informants, and we normally pay informants, I’m here to pay you," deadpanned FBI special agent Eugene Casey. "Not with money, unfortunately, Congress hasn’t given us a budget yet for this fiscal year, but to pay you compliments and my respect. So thank you. Thank you for filing SARS." Casey and his colleagues took the stage at the NY Federal Reserve conference center in mid-December at the invite of the NY Metro InfraGard Alliance, an FBI-sponsored public-private alliance that urges security and technology chiefs from all sectors to build relationships with law enforcement. The quartet told some tales from the street: Bangladeshi mortgage fraud rings in Queens, $280 million in cash seized in Mexico City earlier this year, and even an ID thief who, when he heard the FBI pounding on his door, escaped out the window naked, pausing only to grab a Ziploc bag containing 400 credit reports. The common thread in most money laundering arrests, the agents attested, was the value of SARs in helping them pursue their cases. Informers, eh?
December 24, 2007
The Central Bank of Russia (CBR) has revoked the license of Moscow-based Bank Kitezh, the CBR said Thursday. The CBR said that Bank Kitezh had repeatedly violated over one year requirements of the federal law on the prevention of money laundering and financing of terrorism. Bank Kitezh did not report to the Federal Service for Financial Monitoring on transactions subject to obligatory reporting, the CBR said. The CBR has appointed a provisional administration to run the bank until an arbitration court rules to declare it bankrupt or to appoint a liquidator of the bank. The CBR could revoke 50-80 banking licenses this year, the CBR's First Deputy Chairman Gennady Melikyan said in November, adding that the bank revokes a similar number of licenses every year. The CBR had revoked 40 licenses as of early November since the beginning of the year, Melikyan added.
December 17, 2007
Othman Ahmed Othman al Haidar, who is wanted by the Bosnian authorities, continued to visit Kosovo but changed his mode of transport - he travelled by air instead of land. Express newspaper sources from Prishtina International Airport have advised that even though that person officially was expelled from Kosova in 2004, he returned through this airport in 2005. The Revival of Islamic Heritage Society (RHIS/P) which has branches/offices in 54 countries, including Kosovo, is on the black list of the US State Department as an NGO that may have ties to Al-Qaeda. The organization has been under investigation by a court in Bosnia-Hercegovina on money laundering charges since 1994. A police official has advised that Othman Ahmed Othman al Haidar was in Kosovo even this year - more specifically, around four weeks ago, and was seen on at least one occasion in the company of a former UNMIK police officer from Pakistan...
December 10, 2007
The president of human rights group Freedom Now, raised the prospect of Washington imposing sanctions, such as those used against a Macau bank accused of money laundering for nuclear-armed North Korea, on a Southeast Asian state-owned bank suspected of links to Myanmar's military rulers. "Anecdotally in conversations with diplomats in ASEAN countries, I know there is a deep concern about the prospects of the United States doing to a state-owned bank what happened to Banco Delta Asia in Macau because of its laundering of North Korean funds," a DC hearing was told...
December 3, 2007
The Central Bank of Russia has revoked banking licenses from three Russian banks for money laundering: Samolyotbank and BIKBANK... Meanwhile, UAE-based banks are reluctant to deal with companies that are likely to import goods into Iran, says Nasser Hashempour, vice-president of the Dubai-based Iranian Business Council....
November 26, 2007
Singapore has no plans to change banking secrecy laws, an official at the Monetary Authority of Singapore (MAS) said last week. "They allow for the necessary transparency in combating criminal activity, while safeguarding investors' interest for safety and security," the official said. The EU is pressing for more transparency in Singapore's banking regime and participation in the EU savings tax directive, so the MAS position could undermine talks for a trade agreement between Singapore and the EU. Singapore insists that it won't become a shelter for money laundering, particularly with the opening of two multi- billion dollar casinos in 2009 and its proximity to countries that are battling terrorist groups. Singapore is resisting pressure to join in the EU withholding tax arrangements, introduced in 2005, which impose a tax on the investments of EU nationals residing in another EU country. They are seen as the main stumbling block to a trade agreement. Switzerland caved in to the pressure and now collects withholding tax for remittance to the member states of the EU. In its statement, the MAS noted: "The Singapore constitution does not allow us to collect taxes on behalf of a foreign country."
November 18, 2007
North Korean officials are to meet US diplomats, Treasury officers and Secret Service agents in talks in New York this week to discuss steps Pyongyang could take to abandon counterfeiting and money laundering activities for it to be integrated into the global financial system. The two-day talks from Monday, convened at Pyongyang's request, will be "related to money laundering and other forms of illicit finance," a US State Department official said. The US team will be led by the Treasury's deputy assistant secretary Daniel Glaser North Korea will be represented at the talks by a six-member delegation led by Ki Kwang-ho, a director at Pyongyang's finance ministry, South Korea's Yonhap news agency reported -- hopefully, it might be added.
November 12, 2007
In Athens, US embassy spokesperson Carol Kalin said Greek authorities have been asked to "investigate" the bank as US allies have been urged to take "similar or comparable measures" to those adopted by Washington. The US last month blacklisted Bank Melli and Bank Mellat, accused of providing banking services for Iran's nuclear agencies, and Bank Saderat, which allegedly funnels funds to Hezbollah, Hamas, PFLP-GC, and Palestinian Islamic Jihad. The bank from 2001 to 2006 transferred 50 million dollars from the Central Bank of Iran to its branch in Beirut via London for the benefit of Hezbollah fronts in Lebanon, and has also transferred several million dollars to Hamas, the State Department says. "As we announced on October 25, we had a new round of US sanctions on certain Iranian entities, including Bank Saderat. This is part of our effort to advance diplomacy on Iran," Kalin said. "We have asked our allies to take similar or comparable measures to those we've taken."
November 5, 2007
From a Q&A with Chris Hill in Beijing last week:
Q You mentioned discussion of the financial issues. The last time that issue came up with BDA the Six-Party Talks stalled for over a year. Are you concerned that some of those things might scuttle talks again this time?
MR. HILL: No, I think from their point of view they're interested in improved access to the international financial system. From our point of view, we're interested in assurances and actions on their part to deal with the problems of counterfeiting and other money laundering concerns, which I think have been prime issues in impeding them from access to the international financial system.
October 29, 2007
"We call on responsible banks and companies around the world to terminate any business with Bank Melli, Bank Mellat, Bank Saderat, and all companies and entities of the IRGC," U.S. Treasury Secretary Henry Paulson said in a statement. And in Toyko they wondered, how would they pay for and settle on the 10% of their energy that comes from Iran?
Bank Melli has several subsidiaries: Bank Kargoshaee, in Tehran; Bank Melli Iran Zao, in Moscow; Melli Bank, in London; and Arian Bank, a joint venture with Bank Saderat in Kabul. Bank Mellat has branches in Armenia, Britain, South Korea and Turkey. Bank Saderat specializes in the financing of Iranian's foreign trade balance. Its international businesses are mainly concentrated in the Gulf countries and Lebanon, but it is also active in France, Germany and Greece....
October 22, 2007
On the new U.S. list of Myanmar sanctions, Pavo Trading Pte Ltd, Air Bagan Holdings Pte Ltd and Htoo Wood Products Pte Ltd serve as "wake-up call" for Singapore. Also named is Air Bagan Ltd of Myanmar, which last month made Singapore its second international destination. The airline's chairman, Tay Za, arrived on the first flight. According to AFP, Tay Za has very, very strong links to the junta... The directory at a building in Singapore's central business district lists Air Bagan Holdings and the two other blacklisted Singapore-linked firms as operating from a suite on the 24th floor. But the suite carries no sign and workers in neighboring offices said they knew nothing about what type of company operates from there, although they have seen people coming and going on weekdays. An opaque blue sticker covered the door and obscured the interior. Phone and email messages to Pavo Trading were not immediately returned...
October 15, 2007
Revolting revolving door: on the American Bankers Association's committee to weaken anti-money laundering laws are a slew of former regulators: Richard Small, the Federal Reserve AML "guru" who sold out to Citigroup then GE Money; William Fox, former Financial Crimes Enforcement Network (Fincen) director, now at Bank of America; Werner, another former Fincen director and now at Merrill Lynch; and William Langford, a former director of regulatory affairs at Fincen and now a senior vice president of global AML at JPMorgan Chase. The three top banks, the biggest brokerage and GE Money all hired directly from the agencies, and now use them to lobby for de-regulation...
October 8, 2007
A (hype?) search of UK-registered companies turned up 4,000 exact matches for terrorists, financial criminals and disqualified directors. Worldcheck's Rob Mitchell presented findings of the project his firm conducted into UK registered companies to an audience at Mount Murray Hotel. 'Some results were eye opening,' he said. Worldcheck compared the Companies House register with its own database of 589,000 organizations and individuals that have come to their attention through due diligence research, sanctions lists and the likes. Mitchell said: 'There were significant matches across all categories that go well beyond disqualified directors - although we did find 1,504 of these who were current directors of UK firms despite their disqualification.' In fact, the research turned up 4,000 exact matches including 13 for known or suspected terrorists and 154 for people involved in financial crime...
Meanwhile, U.S. President Bush signed off on the first U.S. shipment of heavy fuel oil to North Korea in five years after the country agreed to complete an inventory of its nuclear programs and disable its existing nuclear facilities by the end of the year. The United States will send 50,000 metric tons of fuel worth about $25 million, according to the president's order...
October 1, 2007
In a one-paragraph statement, the government in Macau, a former Portuguese colony that is a burgeoning gambling haven, said last week Banco Delta Asia had shown ''remarkable improvement'' during two years of government oversight. It said that Stanley Au, a former gold dealer who ceded control of the bank in September 2005, would be put in charge of the bank again on September 29...
September 24, 2007
The UN's Ban Ki-moon has appointed Carlos Castresana Fernandez of Spain to head the International Commission against Impunity in Guatemala (CICIG), established under an agreement between the United Nations and the Government of Guatemala that entered into force on 4 September. Castresana was previously assigned to the Special Prosecutor's Office against Drug Trafficking, where he handled cases of criminal organizations charged with international drug smuggling and money laundering...
September 17, 2007
In the same week that Bank of America set a record, jacking up its surcharge for the use of ATMs to three dollars, the Federal Reserve hauled off and delivered an approval, of BofA's takeover of LaSalle. The Fed seems to have ignored most of the issues raised. For example, the Fed states that ICP and Fair Finance Watch
"expressed concern about Bank of America’s connection to investigations and lawsuits related to the bankruptcy of Parmalat SpA, Parma, Italy. The commenter also expressed unsubstantiated concerns about Bank of America’s student loan policies [and] the handling of certain money transfers through the New York branch of Bank of America, National Association."
September 10, 2007
Last week U.S. District Court Judge Victor Marrero ruled that the amended National Security Letters provisions of the Patriot Act that gagged those receiving the letters from disclosing the fact violated the First Amendment and the separation of powers. Since the gag-order provisions could not be meaningfully separated from authority to issue the letters, he struck down the whole law, while staying the implementation of his ruling pending any appeal or for 90 days if there is no appeal. Department of Justice Spokesman Dean Boyd said government lawyers were "reviewing the ruling and considering our options."
September 3, 2007
In 2006, Paraguay imported $4.5 billion worth of goods and exported $1.7 billion. Most economists expect that would have sent the 6.7 million-person country's currency into free fall. That didn't happen, leading many to surmise that the bulk of those imports were re-exported without documents, for example through Cuidad del Este. The wholesalers there, according to McClatchy, include not only the hyped-up Lebanese, but also Koreans...
More fascinating stuff on:
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