Newsletters and Reports
The notice from FinCEN notes that one of the typologies noted is rewards-based crowdfunding. Keeping up with the times, I see.
This is a really nice report – it includes a Trending Now section, a section highlighting a single sector, and another highlighting trends from SAR narratives, among others.
Links:
Here is the web-friendly version of AUSTRAC's e-news (it gets sent as an email, but there's a link to show it as HTML). It includes, among other information, the following:
Link:
Counter-Terrorism Financing Summit News Release
AUSTRAC Remittance Registration actions page
Remittance Registration action news release
Every year, there is an independent review of the UK’s TAFA 2010 law, and its implementation. This year’s report has a lot of statistical and historical context in it. Interesting points:
As to designations being challenged in court:
The only possible improvement that I could suggest to current processes is
prompted by the reflection that when decisions to designate are tested on appeal, there has been a persistent tendency to de-designate rather than to defend the
decision in court.
and
During the period under review, two persons designated by the Treasury under
TAFA 2010 brought a challenge by way of judicial review, not to their designation
but the fact that it was publicised. That fact was said to have prejudiced their ability
to receive a fair trial. The High Court held that the decision to publicise generally,
without giving them the opportunity of making representations and without giving
the trial judge or the judge in charge of the criminal proceedings the opportunity of
considering the matter, was flawed. It accordingly directed that their names be
removed from the published list of those designated. However their designations
remained in force, and the High Court indicated that the names could remain on a
list of designated persons distributed to financial institutions.31
The case for expanded use of TAFA:
Over 600 extremists are among the many Britons who have travelled out to
Syria and Iraq. A significant proportion have joined ISIL and other extremist
groups. They are reckoned to be more numerous than the Britons who fought
in previous or current theatres of jihad such as Bosnia, Afghanistan and
Somalia.
In addition to the potential of such persons to commit terrorist acts abroad,
there is some evidence that a minority of returning fighters may have been
involved or wish to be involved in terrorist activity at home. This growing risk
caused the threat level to the UK from international terrorism to be raised in
August 2014 to “severe“, meaning that an attack is highly likely.
Travel to and from such conflict zones, together with the preparation of
terrorist acts, often requires funding and facilitation.
The small number of designations indicates that asset-freezing law has played
only a marginal role in combating the most serious terrorist threat of the
present time.
De-risking and frozen assets:
Whilst they are not allowed to close a frozen account,financial institutions do
not wish to deal with persons or organisations believed to be associated with
terrorism, citing reputational and regulatory risk. The imposition of some huge
penalties for money-laundering and the facilitation of sanctions breaches,
particularly in the US, gives a degree of substance to such concerns.
When a designation expires or is revoked, it is normal for banking services to
be withdrawn – notwithstanding the provision by the Treasury of a letter such
as I have recommended,49 explaining the position – and for great difficulty to
be experienced by the designated person in finding another banker.Nor have more radical solutions – for example, the imposition of a universal
service obligation on the banks, a power to require banking services to be
provided in a particular case,50 or a role for the Bank of England as banker of
last resort – been adopted.
And only one new recommendation:
Recommendation 13
The Chair of AFRG meetings at which new potential designations are discussed
should consider adopting a “devil’s advocate” approach, whereby one member of the
AFRG is asked to put the case against designation, thus assisting the group in
identifying any possible weaknesses in the case put forward. Sufficient material
should be provided (including, where appropriate, primary intelligence underlying
agency assessments) for this exercise to be performed in a meaningful way.
A sleepy report, comparatively, but very edifying nonetheless.
Links:
4th Independent Reviewer Report
FINTRAC, the Canadian FIU (Financial Intelligence Unit), has released a report on the money laundering methods used in mass marketing fraud. The highlights section:
When FIUs produce these (FinCEN does, too), they are very useful in keeping on top of current trends in financial frauds and crimes, and the methods for attempting to hide them from financial firms and regulators.
Link:
FINTRAC Mass Marketing Fraud: Money Laundering Methods and Techniques – HTML, PDF
It obviously takes a long time to collate this report, as it covers licensing activity under the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) from October 2010 to September 2012. This is the 6th one.
Some highlights:
Short (4 pages), but informative – read it now, or wait until 2016…
Links:
Biennial Report of Licensing Activities
Seems like small potatoes to Mr. Watchlist – although it is just terrorists:
|
TAFA 2010 |
EU |
Al-Qaida regime |
|
|
Assets frozen (as at |
£100,000 |
£11,0001 |
£58,0002 |
|
Number of accounts |
40 |
10 |
25 |
|
New accounts frozen |
19 |
0 |
0 |
|
Accounts unfrozen(during Q1 2014) |
35 |
0 |
13 |
|
|
||||
|
Number of designations |
29 |
374 |
279 |
|
|
(i) New designations |
3 |
0 |
0 |
|
|
(ii) Delistings (during Q1 |
12 |
1 |
5 |
|
|
(iii) Individuals in custody |
4 |
0 |
0 |
|
|
(iv) Individuals in UK, not |
1 |
0 |
3 |
|
|
(v) Individuals overseas |
13 |
11 |
213 |
|
|
(vi) Groups |
8 (0 in UK) |
26 (1 in UK) |
61 |
|
|
Individuals by Nationality (ii) Non UK Nationals |
7 |
n/a |
n/a |
|
|
Renewal of designation |
14 |
n/a |
n/a |
|
|
General Licences |
(i) 0 |
|||
|
Specific Licences: (ii) Amended |
7 0 |
0 |
2 |
|
I wonder what it cost UK banks to enforce this during the quarter – I dare say it was more than 200,000 GBP…
The report also lists a small number of ongoing legal claims under this regime that HMT is pressing on with.
Link:
Quarterly TAFA report for Q1 2014
On Tuesday, the Commercial Secretary to the Treasury issued a 12-page report (of which there was really only one page of content!) responding to the Independent Reviewer's 3rd annual report on the operaiton of TAFA (Terrorist Asset-Freezing etc. Act 2010).
Here's the meat of the report, which responds to the two new recommendations:
Recommendation 11
High-level consideration should be given to the practical role that TAFA 2010 may
realistically be expected to play in the fight against terrorism, on its own or in conjunction
with other financial and non-financial measures.1.1 The Government recognises the importance of making the most appropriate and effective
use of all available tools and powers to combat terrorism. Senior-level interdepartmental
discussions continue to take place on the best use of HMG’s terrorist asset freezing powers and
the way that those powers can be used to best effect. We will continue those discussions during
the course of the next year, aiming to ensure that our terrorist asset freezing powers continue to
be used and administered in an effective and proportionate way to help protect the public from
the threat of terrorism.Recommendation 12
Mechanisms should be put in place to ensure that designation under TAFA 2010 is
considered in all cases where it could be beneficial. In particular, and subject to the
conclusions under Recommendation 11, the possibility of designation should be routinely
considered in cases where TPIMs and proscription are being contemplated, when suspected
terrorists are arrested or charged and in cases where deportations, deprivations of citizenship
or passport removal are contemplated on national security grounds.1.2 The Government agrees that TAFA designations should be considered in all cases where they
may be beneficial. The Treasury is advised by law enforcement and security agencies of the
individuals and entities against whom TAFA designation might be appropriate. Those agencies
are best placed to decide and advise on the most appropriate mechanisms to disrupt terrorist
activity by a person or entity. Law enforcement and security agencies already have processes in
place to consider the various options to disrupt terrorist-related activity. However, the Treasury
will continue to work closely with partner agencies to raise the awareness of asset freezing, its
effects and requirements for designation with partner agencies to aid their consideration of the
appropriate disruptive tools to use.
Link:
Response to Independent Reviewer Report