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FinCrime News - March 2022

Anthony Quinn
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International

The Financial Action Task Force (FATF)

  • Released Jurisdictions under Increased Monitoring on 04 Mar 2022. Jurisdictions under increased monitoring are actively working with the FATF to address strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing. The United Arab Emirates was added to the list, while Zimbabwe was removed.
  • Released High-Risk Jurisdictions subject to a Call for Action on 04 Mar 2022. High-risk jurisdictions have significant strategic deficiencies in their regimes to counter money laundering, terrorist financing, and financing of proliferation. There were no changes to the countries on the High Risk Jurisdictions list.
  • Published consolidated assessment ratings on 22 Mar 2022. An up-to-date overview of the ratings on both effectiveness and technical compliance for all countries assessed against the 2012 FATF Recommendations and using the 2013 Assessment Methodology.
  • Published the latest FATF Recommendations on 11 Mar 2022. The FATF Recommendations are the basis on which all countries should meet the shared objective of tackling money laundering, terrorist financing and the financing of proliferation. The latest version contains revision of Recommendation 24, INR.24 and Glossary, and the addition of two new definitions in the Glossary.
  • Issued a Public Statement on revisions to R.24 on 04 Mar 2022. The revisions to Recommendation 24 will require countries to follow a risk-based approach and consider the risks of legal persons in their countries. The adopted changes to Recommendation 24 will significantly strengthen the global response to tackling concealment of beneficial ownership of legal persons.
  • Published the Outcomes of the FATF Plenary on 04 Mar 2022. The Plenary approved key work that will prepare for the next round of mutual evaluations and finalised an update to Recommendation 24, to improve the transparency of beneficial ownership of legal persons. The FATF approved a report on the money laundering and terrorist financing risks of migrant smuggling, and agreed to release a guidance for public consultation that will help the real estate sector to implement risk-based measures to better detect and prevent money laundering. The FATF agreed to begin work on enhancing asset recovery by strengthening collaboration between the FATF/FSRBs and the Asset Recovery Networks – CARIN and the ARINs, and also agreed to further consider strengthening Recommendations 4 and 38 on the domestic and cross-border frameworks. Delegations also started new work on the proceeds of the trafficking of fentanyl and other synthetic opioids.
  • Published report on ML and TF Risks Arising from Migrant Smuggling on 22 Mar 2022. This report identifies the most common methods to transfer and launder the proceeds of migrant smuggling and provides several recommendations and good practices to better identify and investigate these criminal proceeds.
  • Published report on the Republic of Cameroon's measures to combat money laundering and terrorist financing 22 Mar 2022. This report summarizes the anti-money laundering counter financing of terrorism (AML/CFT) measures in place in the Republic of Cameroon as at the date of the on-site visit from 23 February to 12 March 2021. It analyses the level of compliance with the Financial Action Task Force (FATF) 40 Recommendations and the level of effectiveness of Cameroon's AML/CFT system and provides recommendations on how the system could be strengthened.
  • Announced Public Consultation on the FATF Risk-Based Guidance to the Real Estate Sector on 04 Mar 2022. The Financial Action Task Force (FATF) is considering proposals for the update of the FATF Risk Based Guidance to the Real Estate Sector.

United Nations Security Council

  • Extends the mandate of the expert panel overseeing Sanctions against the Democratic People’s Republic of Korea until 30 April 2023 on 25 Mar 2022. The Security Council extended the mandate of the expert panel assisting the committee overseeing its sanctions against the Democratic People’s Republic of Korea until 30 April 2023.

Regional

Asia / Pacific Group (APG)

No update this month.

Australia

The Australian Transaction Reports and Analysis Centre (AUSTRAC)

  • Announced proceedings in the Federal Court against Crown Melbourne and Crown Perth on 1 Mar 2022. AUSTRAC commenced civil penalty proceedings in the Federal Court against Crown Melbourne and Crown Perth for alleged serious and systemic non-compliance with Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) laws. This action follows proactive compliance work with the casino sector which led to a number of detailed enforcement investigations including into Crown Melbourne and Crown Perth’s compliance.

Australian Government

  • Announced Australia's first Magnitsky-style sanctions on 29 March 2022. Minister Payne announced the first set of Australian Magnitsky-style listings under the Government’s thematic sanctions framework, targeting Russian individuals responsible for the corruption that Sergei Magnitsky uncovered and those complicit in his subsequent mistreatment and death.
  • Announced a sanctions response to North Korea's missile tests on 25 March 2022. Following the 27 February test, Australia responded quickly to impose new targeted financial sanctions against three North Korea-related entities. The entities, from North Korea, Russia and China, were involved in UN sanctions violations or were associated with North Korea’s weapons of mass destruction or missile programs.
  • Issued new sanctions on Russian banks and oligarchs on 18 March 2022. The Australian Government has placed sanctions on 11 additional Russian banks and government entities, with the majority of the country’s banking assets now covered by our sanctions along with all of the entities that handle Russia’s sovereign debt.
  • Announced further sanctions on Russia in a statement on 08 March 2022. The Australian Government is placing new sanctions on Moscow’s propagandists and purveyors of disinformation, who are trying to legitimatise Russia’s unprovoked, unjustified invasion with false narratives such as the “de-Nazification” of Ukraine.

New Zealand

Department of Internal Affairs (DIA)

  • Issued guidance for reporting entities in relation to the Russia Sanctions Act 2022 on 18 March 2022. Te Tari Taiwhenua Department of Internal Affairs, the Financial Markets Authority and Reserve Bank of New Zealand have issued this joint guidance for reporting entities in relation to the Russia Sanctions Act 2022. This includes comments regarding associated obligations under the AML/CFT Act. These should be read in conjunction with this Russia Sanctions Alert provided by the New Zealand Police Financial Intelligence Unit.

Financial Market Authority (FMA)

  • Published guidance on the Impact of Russia Sanctions on AML/CFT reporting entities on 18 March 2022. An update from the three AML/CFT Act supervisors to reporting entities on what is required of them under the Russia Sanctions Act 2022.

Canada

Financial Transactions and Reports Analysis Center of Canada (FINTRAC)

  • Issued Advisory: Financial transactions related to countries identified by the FATF on 28 March 2022. The statement on high-risk jurisdictions subject to a call for action identifies jurisdictions for which the FATF has called on its members to apply countermeasures or enhanced due diligence. The statement on jurisdictions under increased monitoring identifies those jurisdictions, which have developed an action plan with the FATF to address their strategic AML/CFT deficiencies.
  • Published a Special Bulletin on Russia-linked money laundering related to sanctions evasion on 24 March 2022. The content of this Bulletin can be leveraged by reporting entities to identify and assess money laundering and terrorist activity financing risks, apply controls and measures to mitigate these risks, and effectively detect and report suspicious transactions to FINTRAC.
  • Announced an administrative monetary penalty on Forest Hill Real Estate Inc. on 22 March 2022. This real estate broker in Toronto, Ontario, was imposed an administrative monetary penalty of $22,770 on October 28, 2021, for non-compliance with Part 1 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its associated Regulations.
  • Issued an advisory to Canadian businesses on Canada’s Sanctions Related to the Russian invasion of Ukraine on 21 March 2022. The advisory highlights obligations to Canadian businesses established by the sanctions against Russia that Canada has imposed under the Special Economic Measure Act (Russia) Regulations (the SEMA Russia Regulations).
  • Announced an administrative monetary penalty on Taiwanese Canadian Toronto Credit Union Limited on 15 March 2022. This credit union in Markham, Ontario, was imposed an administrative monetary penalty of $297,000 on November 1, 2021, for non-compliance with Part 1 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its associated Regulations.
  • Announced an administrative monetary penalty on Sino Financial Ltd on 03 March 2022. This money services business in Pierrefonds, Quebec, was imposed an administrative monetary penalty of $33,000 on October 25, 2021, for non-compliance with Part 1 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its associated Regulations.

Canadian Government

  • Announced further Myanmar sanctions on individuals and entities responsible for procuring and supplying arms and military equipment to Myanmar on 25 March 2022. Canada is imposing targeted sanctions under the Special Economic Measures (Burma) Regulations against individuals and entities responsible for procuring and supplying arms and military equipment to the military regime in Myanmar, as well as the Commander of the Air Force.
  • Announced additional Sanctions for Myanmar on 25 March 2022. Canada is imposing sanctions against individuals and entities in relation to the coup perpetrated by Myanmar’s armed forces on February 1, 2021.
  • Announced additional sanctions on Belarusian leadership on 17 March 2022. Canada is imposing new sanctions under the Special Economic Measures (Belarus) Regulations in response to the Lukashenko regime’s involvement in Vladimir Putin’s illegal and unjustifiable invasion of Ukraine.
  • Announced additional sanctions on enablers of President Putin’s illegal invasion of Ukraine on 15 March 2022. These new measures impose restrictions on 15 Russian officials who enabled and supported President Putin’s choice to invade a peaceful and sovereign country.
  • Announced additional economic measures on the Russian energy sector on 02 March 2022. These new measures impose restrictions on 10 key individuals from 2 important companies in Russia’s energy sector, Rosneft and Gazprom. These measures are intended to put further pressure on Russia’s leadership to cease its violations of Ukraine’s sovereignty and territorial integrity.
  • Announced additional economic measures on Russia on 01 March 2022. The new amendments impose restrictions on 18 members of the Security Council of the Russian Federation responsible for these actions. The new measures also expand existing prohibitions imposed on 3 Russian financial entities beyond the areas of sovereign debt, as announced on February 24, 2022.

United Kingdom

Gambling Commission (GC)

  • Announced a £9.4m fine for online operator 888 on 01 March 2022. The online gambling business will pay a £9.4m fine after a Gambling Commission investigation revealed social responsibility and money laundering failings.

Law Society of Scotland

  • Published the refreshed Sectoral AML Risk Assessment on 23 March 2022. The Money Laundering Regulations (MLRs) require that the Law Society of Scotland, as Professional Body AML Supervisor, identify and assess the international and domestic risks of money laundering to which their members are subject.

Solicitors Regulation Authority (SRA)

  • Released updated guidance on financial sanctions and Russia on 07 March 2022. The updated guidance is to help firms make sure they are adhering to the Government’s sanctions on Russian nationals and organisations in light of the conflict in Ukraine.

UK Government

  • Announced 65 new Russian sanctions to cut off vital industries fuelling Putin’s war machine on 24 March 2022. The new sanctions target strategic industries, banks and business elites.
    Announced new economic sanctions against Russia on 15 March 2022. The UK Government announced a ban on exports to Russia of high-end luxury goods, while also hitting hundreds of key products with new import tariffs.
  • Announced sanctions on Putin’s propaganda on 31 March 2022. Foreign Secretary Liz Truss has announced 14 new sanctions on Russian propagandists and state media.
  • Announced a historic round of sanctions on Russia on 15 March 2022. Liz Truss announced a historic round of sanctions, taking the overall number of UK sanctions on Russia to more than 1,000 since the invasion of Ukraine.
  • Announced sanctions against 7 oligarchs including Roman Abramovich and Oleg Deripaska on 10 March 2022. Abramovich and Deripaska are among 7 oligarchs targeted in an estimated £15 billion sanction hit.
  • Announced research and innovation sanctions on Russia and support for Ukraine on 27 March 2022. George Freeman MP, Minister for Science, Research & Innovation, announces the UK government's response with a £3 million package to support Ukrainian researchers at risk.
  • Published new legislation targeting Oligarchs’ aircraft and ships on 30 March 2022. New UK government legislation prohibits maintenance on aircraft or ships belonging to sanctioned Russian oligarchs or their businesses.

European Union

European Banking Authority (EBA)

  • Published a report on competent authorities' approaches to AML CFT supervision of banks on 22 March 2022.
  • Published findings that AML CFT supervision is improving but not always effective yet. Since the EBA started reviews in 2019 and strengthened its AML/CFT guidance, national supervisors have started to adopt meaningful reforms to improve their AML/CFT supervision, but the EBA found that significant challenges remain in important areas such as the identification and assessment of money laundering and terrorist financing (ML/TF) risks.
  • Issued a statement on 11 March 2022 calling on financial institutions to ensure compliance with sanctions against Russia following the invasion of Ukraine and to facilitate access to basic payment accounts for refugees.

United States

Financial Crimes Enforcement Network (FinCEN)

  • Announced $140 million civil money penalty against USAA Federal Savings Bank for Violations of the Bank Secrecy Act on 17 March 2022. USAA FSB admitted that it willfully failed to implement and maintain an anti‑money laundering (AML) program that met the minimum requirements of the BSA from at least January 2016 through April 2021.
  • Announced actions on 16 March 2022 to support the REPO Multilateral Task Force and ongoing U.S. Government efforts to combat foreign government corruption. FinCEN takes steps to increase information sharing with task force countries, enhances engagement with financial institutions, and issues a new alert on Russian oligarchs, elites, and their family members.
  • Issued an alert on 16 March 2022 on real estate, luxury goods, and other high-value assets involving Russian elites, oligarchs, and their family members.
  • Issued a statement of intent on Russia-related illicit finance and sanctions on 16 March 2022. The Financial Intelligence Units of Australia, Canada, France, Germany, Italy, Japan, the Netherlands, New Zealand, the United Kingdom, and the United States, referred to as the FIU Working Group Members, issued a statement of intent.
  • Informed U.S. financial institutions on 10 March 2022 that the FATF updated its lists of jurisdictions with strategic AML/CFT/CPF deficiencies.
  • Issued an alert on 07 March 2022 advising all financial institutions to be vigilant against potential efforts to evade the expansive sanctions and other U.S.-imposed restrictions implemented in connection with the Russian Federation’s further invasion of Ukraine.

Department of the Treasury (OFAC)

  • Announced sanctions on Russians connected to gross human rights violations and the corrupt leader of Belarus on 15 March 2022. OFAC designated four individuals and one entity pursuant to the Sergei Magnitsky Rule of Law Accountability Act of 2012 (the Russia Magnitsky Act).
  • Announced sanctions on Russian individuals and entities supporting DPRK weapons of mass destruction and ballistic missile programs on 11 March 2022. OFAC sanctioned two individuals and three entities for supporting the DPRK’s ongoing development of its weapons of mass destruction (WMD) and ballistic missile programs in violation of multiple United Nations Security Council resolutions (UNSCRs).
  • Announced sanctions on Kremlin elites, leaders, oligarchs, and families for enabling Putin’s war against Ukraine on 11 March 2022. OFAC issued a new round of sanctions targeting Russian and Kremlin elites, oligarchs, and Russia’s political and national security leaders who have supported Russian President Vladimir Putin’s brutal and illegal invasion of Ukraine.
  • Issued a press release on 04 March 2022 on the FATF strengthening financial transparency standards and updating evaluation methodology following the conclusion of its sixth plenary. The FATF agreed upon a revised standard to combat the misuse of anonymous shell companies and set the stage for its members and the broader global FATF network to be held accountable to more stringent standards.
  • Announced sanctions on Hizballah financiers in Guinea on 04 March 2022. OFAC designated two key Hizballah financiers operating in Guinea.
  • Announced sanctions on Russians bankrolling Putin and Russia-backed influence actors on 03 March 2022. OFAC and the U.S. Department of State intensified pressure on Russia by sanctioning numerous Russian elites and their family members, identifying certain property of these persons as blocked, and sanctioning Russian intelligence-directed disinformation outlets.
  • Issued a press release on 02 March 2022 announcing additional steps to strengthen compliance with Russia-related sanctions. OFAC issued new public guidance to cut off avenues for potential sanctions evasion by the Central Bank of the Russian Federation. This guidance makes clear that there should be no loopholes for Russia to evade the prohibitions by the United States to lock up Russia’s war chest.
  • Published the national risk assessments for ML, TF, PF on 01 March 2022. The U.S. Department of the Treasury issued the 2022 National Risk Assessments (NRAs) on Money Laundering (NMLRA), Terrorist Financing (NTFRA) and Proliferation Financing (NPFRA). These documents highlight the most significant illicit finance threats, vulnerabilities, and risks facing the United States.
  • Announced sanctions on South Africa-based ISIS organisers and financial facilitators. OFAC designated four Islamic State of Iraq and Syria (ISIS) and ISIS-Mozambique (ISIS-M) financial facilitators based in South Africa.
  • Announced sanctions on individuals and companies involved in the illicit gold trade. OFAC sanctioned Alain Goetz, the African Gold Refinery in Uganda, and a network of companies involved in the illicit movement of gold valued at hundreds of millions of dollars per year from the Democratic Republic of the Congo (DRC).
  • Announced sanctions on Sudanese central reserve police for serious human rights abuse. OFAC designated the Republic of the Sudan Central Reserve Police (CRP) for serious human rights abuse.
  • Announced sanctions on Guatemala’s Los Huistas drug trafficking organisation with ties to Mexican cartels. OFAC designated the Los Huistas Drug Trafficking Organization (DTO) and its leaders for drug trafficking that threatens the people and security of the United States and Guatemala.
  • Issued a press release announcing it is targeting sanctions evasion networks and Russian technology companies enabling Putin’s war. OFAC is continuing to impose severe costs on the Russian Federation for its unprovoked and unjustified war against Ukraine by targeting operators in the Russian technology sector to prevent it from evading unprecedented multilateral sanctions and procuring critical western technology. OFAC is designating 21 entities and 13 individuals as part of its crackdown on the Kremlin’s sanctions evasion networks and technology companies.
  • Announced sanctions on key actors in Iran’s ballistic missile program on 30 March 2022. OFAC sanctioned an Iran-based procurement agent and his network of companies that procured ballistic missile propellant-related materials for the IRGC RSSJO, the IRGC unit responsible for the research and development of ballistic missiles, as well as Iran’s Parchin Chemical Industries (PCI), an element of Iran’s Defense Industries Organization (DIO).
  • Announced sanctions on Burma military leaders, military-affiliated cronies and businesses, and a military unit prior to armed forces day in Burma on 25 March 2022. OFAC designated five individuals and five entities connected to Burma’s military regime.
  • Announced sanctions on individuals supporting Nigeria’s Boko Haram terrorist group by raising funds in the United Arab Emirates. OFAC designated a network of six individuals connected to Nigeria-based terrorist group, Boko Haram. All six were found guilty of establishing a Boko Haram cell in the United Arab Emirates (UAE) to raise funds for and provide material assistance to Boko Haram insurgents in Nigeria.
  • Announced sanctions on Russia’s defense-industrial base, the Russian Duma and its members, and Sberbank CEO on 24 March 2022. OFAC is designating key enablers of the Russian invasion of Ukraine. This includes dozens of Russian defense companies, 328 members of the Russian State Duma, and the head of Russia’s largest financial institution.

Hong Kong

Securities and Futures Commission (SFC)

  • Issued a circular to licensed corporations and associated entities on 14 March 2022. The circular references (1) FATF statement on high-risk jurisdictions and subject to a call for action; (2) FATF statement on jurisdictions under increased monitoring; (3) Outcomes from the FATF Plenary, 2-4 March 2022.
  • Issued a circular to licensed corporations and associated entities on 8 March 2022. The circular references (1) United Nations (Anti-Terrorism Measures) Ordinance; (2) United Nations Sanctions (ISIL and Al-Qaida) Regulation.
  • Issued a circular to licensed corporations and associated entities on 4 March 2022. The circular references (1) United Nations (Anti-Terrorism Measures) Ordinance; (2) United Nations Sanctions (ISIL and Al-Qaida) Regulation; (3) United Nations Sanctions (Yemen) Regulation 2019.

Singapore

Money Authority of Singapore

South Africa

Financial Intelligence Center (FIC)

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