SENTENCING DATE OF FORMER BVI PREMIER ANDREW FAHIE'S COOPERATING CO-DEFENDANT KADEEM MAYNARD MOVED YET AGAIN

In a new development spotted immediately by alert legal observers of South Florida money laundering cases, the sentencing date of KADEEM MAYNARD, also known as "BLACKA," has been moved once again, for the third time, to November 20, 2023. Maynard is expected to testify at trial against the primary defendant in the money laundering, narcotics case RICO case against disgraced former British Virgin Islands premier ANDREW FAHIE, who faces a probable life sentence on serious multiple counts. Fahie is the only surviving defendant who is going to trial, which is presently scheduled for January 8, 2024.

Court watchers are reportedly puzzled by this repeated resetting of the sentencing date for a defendant who has previously changed his plea to guilty, and who sentencing was previously rescheduled for a date (January 18) after Fahie's trial, obviously since he wants to get credit for his cooperative testimony, but in many such cases, he stands to significantly gain from the changed circumstances. Maynard will receive some credit for his cooperation at sentencing, most likely through USSG 51.1 for Downward Departure, and his defense counsel is most likely anticipating that his sentence will be further reduced by a Government motion, under Rule 35(B), to reduce his sentence after he testifies at trial. In fact, there may be an agreement between his attorney and the Assistant US Attorney handling the case to do just that. That is the best case scenario, and may explain the change in dates.

Fahie's situation, and his chances of securing an acquittal from a jury at trial, continue to deteriorate, in our humble opinion, and we wonder why he has chosen to put the Government through the time and cost of a trial, where the outcome appears to be certain, given the volume of evidence and cooperating witnesses. It has often been thought that the real targets here are other, even more prominent Caribbean government leaders, and that Fahie alone can implicate them. Unfortunately, he stubbornly declines to cooperate, and this decision will most likely be extremely costly in the long run. He does have the right to force the Government to prove its case, but he may rue the day he chose to do that. 

A FORMER MONEY LAUNDERER UNMASKS THE UNIQUE CHALLENGES AND RED FLAGS ACROSS BORDERS IN AML FOR SWISS BANKERS AND FINANCIAL SERVICE PROVIDERS

Have you read the recently issued FINMA GUIDANCE 05/2023 Money Laundering Risk Analysis, and do you have concerns about its findings, as well as new proposed Swiss rules that will ramp up the war on money laundering within its borders? It appears that Swiss authorities are about to target financial institutions that fail to maintain effective AML programmes. 

Readers of my analysis & commentary articles on AML/CFT are invited to virtually attend my upcoming presentation Unmasking Unique Challenges and Red Flags across Borders in AML - For Swiss Bankers and Financial Services Providers in the face of American Investors. If you are a compliance officer at a European bank seeking to reduce the risk that the Proceeds of Crime coming from the United States, is gaining access disguised as legitimate investment, you will want to learn about advanced American money laundering tradecraft, and how to identify and interdict it in real time. 

On Tuesday, October 24th, I will be discussing this important topic, from my unique viewpoint as a former career money launderer, in a live seminar, sponsored by AVIOLO COMPLIANCE SOLUTIONS GMBH of Zurich. Details on how you can obtain virtual access will appear here in September. 

CONVICTED IN MALTA, JOMIC MAATOUK NAMED AS ONE OF EUROPE'S MOST WANTED FUGITIVES BY EUROPOL

JOMIC CALLEJA MAATOUK, convicted of Trafficking in Explosives, and who sought to acquire POLONIUM, a known radioactive poison, has been listed as one of Europe's Most Wanted, due to his criminal history. He constitutes a clear and present danger to public safety,  and has been described by the sentencing judge as a"lethal Weapon." He was sentenced to five years in prison.

As we have previously detailed on this blog, he is considered a primary suspect in the poisoning death of British investigative journalist BARRY RANDALL, who was in Montenegro seeking information and evidence of corruption, based upon leads furnished him by the assassinated Maltese journalist DAPHNE CARUANA GALIZIA. There are fears that he may himself now be killed, in order to cover up the alleged involvement of senior Maltese Labour Party leaders, some of whom are present and former government officials, in Randall's death. We shall continue to follow this case, and will report on all developments as they occur.

EXPOSING AND INTERDICTING THE ELUSIVE FIELD-GRADE MONEY LAUNDERER

While money launderers come from a wide variety of occupations and professions, most are errant attorneys, accountants, current or former bankers, or corporate or financial service types. Who they are is not as important as what they are as a measurement of effectiveness in that dark business.Can they wash, dry & fold (place, layer and integrate) a criminal clients' illicit profits with ease, and without exposing either themselves or their clients to law enforcement, government regulators, or bank compliance officers? That is the litmus test of their ability.

In measuring those individuals, I like to use a military equivalent to simplify the metric: many are Company Grade, and a much smaller group are Field Grade. For those who don't have prior service to guide them, Company Grade are the Lieutenants and Captains. They have a modicum of  training and experience and are frontline participants in the game, the movement of funds through the financial  structure, in order to conceal their criminal origin, and clean it along the way to a specific goal, whether that be legitimate investment, or simply concealing it for future client access.

The second group, which is much smaller, are the Field Grade money launderers. The military equivalent are Majors and Colonels. They have already had extensive hands-on experience "in the field," as active players in the movement of illicit capital, and they have been eminently successful in this criminal endeavour. Graduating from day-to-day money movement tasks, they now generally supervise their subordinates and "staff" in significant volume of dirty cash, while retaining their version of Command and Control over the entire operation.

Whose is it that you encounter when you catch someone laundering money into, or through, your bank or non-bank financial institution ? It is the Company Grade money launderer, either when he makes a fundamental error, or you are just good enough to spot his moves. As a compliance officer with training and experience, looking for the red flags of money laundering, or specific tradecraft, you identify his operation in real-time and out him, as the gatekeeper you were designed to be.

Sometimes, however, this is not the complete story. Your young money launderer may just happen to be the tip of the iceberg; he may be only an underling, in support of a far more experienced laundryman, one who has had many years to not only perfect his craft, but to evade and elude detection through experience and the money laundering experience of street smarts. 

Field Grade money launderers, which are few in number, and who may have decades of success behind them, are the kingpins of their illicit profession. In truth and in fact, they may be behind the curtain here, directing others from a position, both physical and leal, of utter safety. Those individual are the hardest to identify, let alone interdict in process. They may confine themselves to sanctuaries where they defy extradition, due to corruption and political connections, or by sheer power. You my even have identified them, only to find you are unable to find evidence linking them to criminal activity.

Therefore, the next time you unover what appears to be a sophisticated money laundering operation, but cannot understand how the players have identified could have created such an advanced method, look under the covers for another hand in the equation, someone directing the participants and players, like puppets on a stage. You may just have seen evidence of a rare breed, their supervisor. Catch that man if you can, or at least identify him for the rest of us to watch for. 

FINRA ISSUES AN INVESTOR ALERT ON LIFE SETTLEMENTS

Here is the Alert, taken from the FINRA website https://www.finra.org/ I recommend that you read it if you are not familiar with the use of Life Settlements, also known as life insurance settlements or viaticals, as instruments for money laundering. See also our prior article in the Tradecraft 101 series, which appears as Part Two, Money Laundering through Life Settlements (May 22, 2023). 

What Is a Life Settlement?

If you own a life insurance policy that you no longer want or need, you can surrender the policy for its cash value or allow it to lapse. Life settlements present a third option: Sell your policy (or the right to receive the death benefit) to an entity other than the insurance company that issued the policy. That transaction is known as a life settlement.

The purchasers of life settlements, sometimes called life settlement companies or life settlement providers, generally are institutions that either hold the policies to maturity or resell policies—or sell interests in multiple, bundled policies—to hedge funds or other investors.

In exchange for your policy, you’ll receive a lump sum payment. The amount you’ll receive will depend on a range of factors, including your age, health, and policy terms and conditions. Such payments are generally more than the policy's cash surrender value (the amount you can collect if you cancel or "surrender" the policy before it matures or you die) and less than the net death benefit (the amount specified in the insurance policy or annuity contract, minus any unpaid premiums that are due and outstanding loan balances or other withdrawals).

In addition to paying a lump sum for your policy, the buyer agrees to pay any additional premiums that might be required to support the cost of the policy for as long as you live. In exchange, the buyer will receive the death benefit when you die.

Factors to Consider When Deciding Whether to Sell

A life settlement might make sense for you if you no longer want or need your current policy—or if you can no longer afford the expense of paying insurance premiums and are willing to give up or replace the coverage. Even then, however, proceed with caution. Here are some key factors to consider:

• Ongoing Life Insurance Needs. If you’re considering buying a new policy with the proceeds of the life settlement, will you be able to get a new policy with equivalent coverage—and at what cost? Your old policy will still be in force through the purchaser and may affect your ability to get additional coverage. Even if you can get a new policy, you might have to pay higher premiums because of your age or changes in your health status. If your goal is to retain coverage but lower the premiums you pay or otherwise obtain different features, you might want to consider options such as reducing your existing amount of policy coverage or making a "1035 Exchange."
• Less Costly Alternatives. If one of the factors driving your decision is a need for cash, surrendering your life insurance policy for its cash value or pursuing a life settlement are not your only options—especially if you’d ideally like to retain your coverage. You might be able to borrow against your policy. You might also be eligible for accelerated death benefits, which allow an individual with a long-term, catastrophic or terminal illness to receive benefits on their policy prior to dying. Check with the company that issued your policy before entering into a life settlement.
• Difficulty Determining Fair Prices. One of the hardest things to know when you’re selling a life insurance policy is whether you’re getting a fair price. The best way to make sure is to shop around. This can mean contacting multiple life settlement companies, using a licensed life settlement broker who will shop your policy around on your behalf, or contacting your investment professional or other financial services provider. You can also use a self-directed online exchange to get an estimate, though doing may result in sales calls or emails.
• Impact on Your Finances. The lump sum payment you receive in exchange for your life insurance policy can be taxable, depending on your circumstances. It may also negatively impact your ability to receive state or federal public assistance such as Medicaid.
• Impact on Your Survivors. Consider your need for current income against the future financial needs of your survivors. Even if you’ve determined that they don’t need the proceeds from your insurance policy at this time, ask whether there’s a chance that this situation could change. If so, ask yourself whether you can obtain the liquidity you seek from other sources or by trying alternative ways to tap into the insurance proceeds as suggested above.
• Access to Your Health Information. Any interim and ultimate buyers of your policy might have access to a great deal of personal information about you, including your health status, that in turn can be shared with other entities. You might also have to agree to provide periodic updates about your health, which also might be shared.

Protect Yourself

If you decide to go forward with a life settlement, protect yourself by asking the following questions:

1. Is the life settlement broker or provider licensed in my state? A growing number of states regulate life settlement companies and life settlement brokers to some degree and may require that they be licensed. Check with your state insurance commissioner to see whether the life settlement company or settlement broker you’re dealing with is properly licensed—and whether either has a record of complaints. If you’re working with an investment professional, use FINRA BrokerCheck to learn about their professional background, registration status and disciplinary history.

2. What will happen to my policy? Ask what the life settlement company buying your policy will do with it. Will they hold it themselves? Sell it individually? Or package it with other policies and sell interests in the package to other investors? The ultimate buyer of your policy will become responsible for paying the premiums and will collect the death benefit when you die.

3. What information will I have to provide? To whom? For how long? You’ll have to authorize the release of medical and other personal information so that a buyer can determine how much to offer for your life insurance policy. Once the buyer obtains that information, they may share it with other entities including lenders or third-party investors.

4. How can I protect my privacy? Carefully read the application, and make sure that the company has procedures in place to protect the confidentiality of your information. If it will be sold, ask to whom and whether the end buyers will have access to your personal information. If you use a life settlement broker, find out the names of the life settlement companies from whom the broker solicits bids, and ask about the privacy policies of all parties or potential parties to the transaction. In many cases, state regulations govern the handling of confidential information. Contact your state insurance commissioner to find out what regulations apply.

5. What's the best price I can get for my policy? If you’re using a life settlement broker, ask what bids were received and what steps the broker took to make sure you’re being offered the most competitive price available. If you’re approached by someone soliciting you to sell your life insurance policy, understand that person's role in the transaction: Are they a life settlement broker who represents you, or are they affiliated with a particular life settlement company? If the answer is the latter, the person might only obtain an offer from that company, making it hard for you to know whether you’re being offered a competitive price.

6. What are the transaction costs? Life settlements can have high transaction costs, and those who sell them can receive hefty commissions. Ask how the person you’re working with is being compensated for their role in the transaction—and evaluate critically whether this product is really the best option for you.

7. What if I change my mind? Some states have laws that allow you to change your mind within a certain period of time if you accept an offer and later reconsider.

8. Am I being pressured to make a fast decision? If you feel that you’re being subjected to high-pressure sales tactics or other aggressive advertising, marketing and sales efforts, beware. A legitimate investment professional will provide clear answers to your questions and will give you the time you need to make an informed decision.

If you have questions or want to file a complaint about a life settlement, contact your state insurance commissioner. If your complaint concerns a variable life insurance policy, you may also file a complaint with FINRA.

 

WHY DID I BECOME A MONEY LAUNDERER?

When I speak at conferences and seminars about the decade I spent as a career money launderer, attendees often come up to me after my presentation and bluntly ask me why I ever got involved in such a dark, and indeed suicidal, activity. As a respected bank lawyer, Vietnam veteran living in Miami, with its superb weather and everything else that the city offers, how did this happen? Most money launderers get caught sooner or later, usually because their "clients" get jammed up with an indictment, and the only way they can mitigate their eventual sentence is to render what is known as Substantial Assistance, both in the arrest of others, and in the Government's recovery of the proceeds of crime.

I am a first generation American, from a family that arrived in the US a century ago from the Ukraine. Being blessed not only with a liberal arts education, but also the professional benefits of law school, how did I stray, ending up in the company of narcotics traffickers, some of whom were definitely dangerous to be around? 

I left graduate school to enlist in the Army during the height of the war, even though I could have received a medical deferment. My patriotic position was that with the privileges of citizenship also come responsibilities. While there, I extended my tour, which is how I ended up on the back of an armored personnel carrier, crossing the border, in Nixon's ill-fated invasion of Cambodia, when we attempted to wipe out the North Vietnamese Army's sanctuaries there. it was my welcome to the Ho chi Minh Trail.

I used to think that it was become of PTSD, Post-Traumatic Stress Disorder, and it is true that I was exposed to serious during my more than 400 days in Vietnam, where the enemy was doing its best to end my life, and of those I served with. Many Vietnam veterans, many of whom have been diagnosed with PTSD, later engaged in criminal activity after their discharge, and served time in prison for their crimes. was the war the presumptive cause?

Alternatively, I thought that living in a dangerous, life-threatening situation had made me an addict to that kind of life; since I encountered a number of Vietnam vets engaged in international narcotics smuggling, I believed that the theory had merit. I know that I personally chafed at being confined to a law office all those early years. Did a life of safety bore me? 

Now, however, I have something medical to consider as the cause for my aberrant behavior: Last year, the Veterans Administration started administering the newly-passed PACT Act, which  deals with Vietvets who were exposed to Agent Orange, a defoliant sprayed from the air into the jungles of Vietnam, to deny cover to the NVA and Viet Cong. My tour was in the area most affected, and I have filed a claim, as I have a condition and symptoms presumptively linked to that toxin. Fortunately, I do not have terminal cancer as the result, because like many veterans so exposed I would already have passed away, as have a large number of them. I am able to deal with my Agent Orange exposure, thanks to advances in medical science.

Here's my dilemma: Agent Orange also has neurological consequences: many of those exposed now have conditions that include Parkinson's Disease and ALS, also known as Lou Gehrig's Disease. I don't know if I have been affected in any way, but neurological damage can affect one's behavior. Did I commit money laundering because I had a diminished capacity? I cannot say, but it is just one more mystery I cannot answer, as only an autopsy of my brain will supply an answer, and medicine has not reached the point where Agent Orange has been determined to cause normal people to engage in crime.  

So, I have no answer for you; I have spent decades trying to atone for those sins, by teaching law enforcement, the intelligence community, and the private sector how to catch money launderers, performed EDD and identified financial criminals, and exposing money tradecraft to two generations of compliance officers. Hopefully, I will one day know why I acted the way I did, but in the meanwhile, I offer my unique experience and perspective as a financial crime consultant. Find the bad guys, ladies and gentlemen.      

IN MONEY LAUNDERING, ALWAYS CONSIDER THE LAW OF UNINTENDED CONSEQUENCES

I note that, for the purposes of stimulating tourism, nonstop flights between the Continental United States and the Faroe Islands are about to begin this month, from New York Stewart International Airport (SWF) to Vagar Airport in the Faroes (FAE). If you weren't paying attention in Geography class, the Faroe Islands lie just north of Scotland, and west of Norway, in the North Atlantic. It is a self-governing territory under the external sovereignty of the Kingdom of Denmark, which is similar to the arrangement of certain British Overseas Territories in the Caribbean. They have one of the longest functioning Parliaments in the world. Are you beginning to get the picture yet?

The Faroes are outside, and not a part of the European Union; even their Danish nationals residing there are not considered to be bound by any EU treaties. The territory is also not bound by EU sanctions against Russia, and in fact continues to trade with Russia since the invasion of Ukraine. It is outside the Schengen Zone, but in fact there are no border checks on those traveling between it and the Schengen countries. Additionally, it is part of the Nordic Passport Union, meaning no travel documents whatsoever are required to enter Scandinavian countries. Perhaps now you understand the potential attraction for laundrymen and other of the Usual Suspects.

Remember, money launderers play a dangerous game of chess with the world's law enforcement agencies. To avoid discovery and arrest, they think several steps ahead of their adversaries. This means they find new Targets of Opportunity to operate in or from, in the commission of money laundering and financial crime, long before such new jurisdictions become known to law enforcement and regulatory agencies.

American citizens can now travel nonstop to the Faroe Islands, visa-free, and stay up to 90 days. There is no American Embassy or consulate. If you have read between the lines, seamless travel from the Faroes into Europe is not only possible, but could most likely be accomplished without leaving a paper trail.You see, the idea is not to move and clean criminal proceeds in the Faroe Islands, but to use the jurisdiction as an intermediary stop where the territory's relationship with the countries of Scandinavia can be exploited, as a part of an international money laundering operation. Indeed,  flights from New York to the Faroe Islands could have unintended consequences not considered by the territory's government. 

I am sure that a number of enterprising transnational money launderers, who have had long and satisfactory experience in the Caribbean, and elsewhere, and who always are doing research into new "opportunities,"have already seen the Atlantic Airways press releases about the commencement, on August 22, of flights to the Faroe Islands. Like I once did, they stay up nights and over weekends, just to ferret out such new potential places to operate from, in, or through. We can only hope that Europol, as well as financial crime investigators, and bankers, in Norway and Sweden are reading this article, and will govern themselves accordingly. Money Laundering chess is a game for both sides. 

TEN CHINESE MONEY LAUNDERERS ARRESTED IN BILLION DOLLAR CASE IN SINGAPORE HAD DOMINICA AND ST. KITTS CBI PASSPORTS AS BACK-UP IN SUPPORT OF THEIR OPERATIONS

                                       

The public statements made recently by some of the five East Caribbean states that sell Citizenship by Investment (CBI/CIP) passports, regarding their reform of the application process, appear to be no more than efforts to delay UK and EU actions to revoke visa-free entry of passport holders to their jurisdictions, if we are to regard this week's news from Singapore as evidence of compliance. Ten Chinese nationals were arrested this week in Singapore, in a billion dollar money laundering investigation, with the seizure of many millions in cash and other assets in the possession of the alleged money launderers.

What is significant is that those accused laundrymen, who all possessed legitimate passports from a number of Southeast Asia or European countries, also had what I consider to be "back-up" passports issued by St Kitts & Nevis and the Commonwealth of Dominica. Those are identity documents used by professional money launderers in their transnational operations to defeat law enforcement investigations into their global layering activities. These CBI passports, issued by the two East caribbean states, allow the holders to enter a jurisdiction under one passport and identity, and exit it using another, which usually shows them with a slightly altered, or totally different, name and background, which effectively acts to break any investigative trail being followed by law enforcement. Efforts to track a target hit a dead end, as his travels can no longer be followed. When you are a traveling laundryman, you are most exposed in the middle of your layering process, and will take any and all steps to insure that you are not apprehended with incriminating evidence; I've been there and know that this is an extremely vulnerable phase for the laundryman. They also run a risk-based operation, only it is to avoid arrest and conviction.

In other words, CBI passports are often used by money launderers as counter-surveillance, as well as making arrest during exit from a jurisdiction impossible, as any stop and detain order with border or frontier authorities does not have their now-used alias and national identity document information. Therefore, the very public moves by St. Kitts and Dominica to appear to have revised and amended their passport sales processes to reduce risk are no more than PR; they have no factual basis.

We might add that both East Caribbean CBI states have close, incestuous relationships with the Peoples' Republic of China (PRC), both on a diplomatic and political level, and Chinese, and even North Korean, nationals have a long history of buying Citizenship by Investment passports with impunity Note that the UK recently revoked visa-free access to all Dominica passport holders, due to the unacceptable risk level posed by those travel documents. 

Unless and until the CBI passports of all five EC countries that issue them lose their privileged status in Europe, criminals, sanctions evaders, intelligence agents, drug traffickers, arms dealers and human rights violators will continue to exploit the legal loopholes that such identity documents present.   

  

MALTA'S "BONNIE & CLYDE," WHO BECAME FUGITIVES AFTER SENTENCING BY TAKING ADVANTAGE OF A LEGAL LOOPHOLE, REMAIN SUSPECTS IN DAPHNE CARUANA-LINKED MURDER

                         

Fugitives JOMIC MAATOUK, and his wife, MARIZA MAATOUK, dubbed Malta's BONNIE AND CLYDE by local commentators, who fled the country whilst out on appeal bonds from their convictions, will reportedly be subject to European Arrest Warrants, according to local media in Valletta. Jomic's conviction, for attempting to purchase C4 plastic explosive, which drew a five year prison sentence, came with a ruling by the magistrate judge that he is to be considered a dangerous person. 

Both Jomic and his wife Mariza, who had received a narcotics conviction, were out on release due to a provision in Maltese law permitting defendants tried before a Magistrate to remain out of prison if they take appeals of their case. This legal loophole allows convicted criminals to evade justice by simply relocating abroad during the pendency of their appeal. Public outcry in Malta, after the couple became fugitives, has been swift, condemning both the courts and the Malta Police for allowing the Maatouks to cheat justice.

Furthermore, the usefulness of the European Arrest Warrant has been questioned, as the fugitive "Bonnie & Clyde" are said to have escaped to Serbia, which is not a Member of the European Union, and as Accession talks to join have stalled since 2009, and considering that Serbia is more or less a supporter of Russia in the Ukraine invasion, won't become a member anytime soon, they are not subject to arrest there. 

Questions remain, given Jomic's efforts to acquire POLONIUM, whether he was implicated in the death of the late British Investigative journalist BARRY RANDALL, who traveled to Montenegro to further an investigation begun by DAPHNE CARUANA GALIZIA, before her assassination, and was apparently fatally poisoned. Malta's Mafia has long been linked to the disgraced former Prime Minister JOSEPH MUSCAT. Montenegro and Serbia, both formerly part of Yugoslavia, have extensive Mafia ties. There is no extradition treaty between the two countries.

 Randall's murder has never been solved. 

ALERT ON EXTENSIVE MONEY LAUNDERING THROUGH ATTORNEYS IN BARBADOS EXISTS

A warning, issued previously by the Barbados Bar Association (BBA) to its members, details a massive, ongoing money laundering operation in progress in and through Barbados banks, using a number of the country's more than one thousand attorneys, to place and layer United States Dollars (USD$), coming from abroad. The then-President of the BBA, ROSALIND SMITH-MILLAR, in a letter reportedly distributed to lawyers admitted to practice in Barbados, warned the attorneys to expect the arrival of checks, via international courier, from non-clients, with instructions for them to deposit the funds in local commercial banks. Such deposits, many of which have already occurred, constitute criminal activity under Barbadian law. Apparently, bankers there have noticed the appearance of similar checks being presented for deposit, and sounded the alarm. Why this information was never widely distributed we cannot say.

Given that the checks are denominated in US Dollars, should any of the lawyers in receipt of these  financial instruments have deposited the same, they may be now in violation of American anti-money laundering laws, which have been held by US courts to confer extraterritorial jurisdiction upon such transactions, and the participants thereto. There are reports that a number of Bajan lawyers have taken such steps, and made the deposits, which bode ill for them in the future. Other lawyers have declined to act, and notified the BBA of the existence of these attempts to involve them in what will certainly be held to be money laundering activity.

We wonder aloud why the Government of Barbados, which most certainly is aware of the appearance of the illicit checks, never notified the public about the clear and present danger posed by this obvious and bold direct solicitation of the legal community to engage in a money laundering conspiracy. We do not know what financial remuneration has been promised or delivered to the lawyers, to persuade them to engage in what they surely must recognize as criminal activity, but typically laundrymen offer a small percentage of the checks as payment, to be deducted from the total amount, after the funds have cleared and are remitted abroad. 

Barbados has an extremely large number of attorneys, far in excess of the amount of legal business needed and existing in that small island nation (population estimated at 280,000), and as the result, many of the ambitious but amoral lawyers there have stooped to engaging in criminal activity to support themselves in an affluent lifestyle, including in money laundering of narcotics proceeds. One prominent attorney, together with her entire family, was recently murdered after she failed to return the proceeds of narcotics crime, which she allegedly was laundering for drug clients. An explosion and fire at her home resulted in her death, as well as that of her husband an minor children. The crime has gone unsolved.

Additionally, errant lawyers in Barbados often supplement their small incomes by stealing client money from real estate transactions, insurance claims and probate matters. A number of victims of such fraudulent activities have recently filed a RICO case. against more than 90 Barbadian attorneys in the United States. See Alex Mitchell et al vs. Mia Amor Mottley et al,  previously reported on this blog.

Compliance officers at financial institutions in the US, UK and Canada should immediately check all the correspondent accounts that they have with banks in Barbados to see whether these money laundering instruments, from lawyers there, have appeared. Given the obvious threats posed by these instruments, consider this an urgent matter. In the event that such payments are discovered or suspected, compliance directors should advise bank counsel of a details forthwith, and consider filing Suspicious Activity Reports (SARs) without further delay, to protect the bank's interests. 

ANOTHER CO-DEFENDANT'S SENTENCING DELAYED UNTIL AFTER BVI PREMIER ANDREW FAHIE'S UPCOMING TRIAL, SO HE CAN ALSO TESTIFY AGAINST HIM

                          

As expected, the US District Judge assigned to the money laundering, narcotics trafficking and RICO case against former British Virgin Islands Premier ANDREW FAHIE has postponed the August sentencing of co-defendant KADEEM MAYNARD to a date after Fahie's trial. Maynard's mother Oleanvine, the other co-defendant had previously had her date moved off, to a day after the trial. This means that both will most certainly be testifying against Fahie, in order to assure that their ultimate sentences will be reduced for their cooperation. 

Fahie's legal position as the result of this action, and the fact that both of his co-defendants will be cooperating witnesses against him, has clearly become untenable, when taken with the evidence already known, and the expected testimony of an undercover witness, in a sting case that relied upon Fahie's abject greed and avarice to succeed. Whether he has chosen to go to trial because he fears physical harm in prison, should he cooperate against other corrupt senior BVI leaders, is not known, but no other reason for his refusal to mitigate his sentence as a CI is plausible. 

Will he be one of those defendants who doesn't see the light and cooperate until after his sentencing? We cannot say, but right now, Fahie's actions are puzzling. 

FORMER NIGERIAN OIL MINISTER, ONCE AT THE CENTER OF THE DOMINICA DIPLOMATIC PASSPORT SALES SCANDAL, ARRESTED IN THE UK AND CHARGED WITH BRIBERY

DIEZANI ALISON-MADUEKE, the former Nigerian Minister for Petroleum Resources, has been charged with Bribery in the United Kingdom. It has been alleged that she received the equivalent of millions of Pounds in bribes and kickbacks for awarding lucrative oil contracts while in her official ministerial position, and that as the result lived a life of extreme extravagance and affluence. Objectively speaking, she may has been the most corrupt of all Nigerian officials who illegally profited from Nigeria's oil boom. Her substantial assets in the UK and the United States were previously frozen by the authorities.

Madueke was at the center of one of the Caribbean's most notorious diplomatic passport sales scandals few years ago, when the Prime Minister of Dominica, ROOSEVELT SKERRIT, illegally sold her a diplomatic passport from his island nation, for a large amount of cash, which she later unsuccessfully employed in a futile effort to avoid arrest in the UK. Skerrit reportedly urgently flew to London to hand-deliver the identity document, after being asked to do so by PATRICIA SCOTLAND, the controversial Secretary-General of the Commonwealth of Nations, who was born in Dominica, though a British citizen. Publicity surrounding the matter damaged the reputation of Skerrit. 

It further focused attention on Dominica's dodgy Citizenship by Investment (CBI/CIP) Program, controlled by the prime minister, and which has sold citizenship to large numbers of career transnational criminals, and Russian organized crime figures, who use dominica passports for visa-free entry to the Uk and EU Schengen Zone. The UK recently revoked Dominica's passport-free entry privileges, and it is expected that the European will follow suit, closing a legal loophole exploited for decades by white collar criminals, international sanctions evaders and corrupt PEPs.

Madueke also faces criminal charges in her native Nigeria, which has long sought her extradition.

MALTA ALLOWS SUSPECTED ASSASSIN OF BRITISH INVESTIGATIVE JOURNALIST TO FLEE WHILST ON APPEAL FROM A CONVICTION INVOLVING EXPLOSIVES

If you wanted an example of how the criminal justice system is broken in the Republic of Malta, here is a classic textbook case. JOMIC CALLEJA MAATOUK, convicted of importing explosives and of attempting to purchase poisons, including POLONIUM, has skipped out on his conviction and five-year sentence. Malta's criminal-friendly laws, which intentionally favour its own Mafia, actually allows freedom pending appeal, through a legal loophole regularly exploited by the country's career criminals, including those convicted of violent acts. Maatouk has failed to report, as required by his bond, together with his domestic partner, has fled the country and is missing.

Maatouk is the prime suspect in the Montenegro poisoning of the late British investigative journalist BARRY RANDALL, who was reportedly following up on leads supplied to him by DAPHNE CARUANA GALIZIA, herself later assassinated for her extensive investigation into systemic corruption in Malta, especially the "Godfather" role played by the former prime minister, JOSEPH MUSCAT. Mr. Randall made a covert trip to explore information he received from Daphne, under conditions of strict secrecy, during which time he allegedly was poisoned by Maatouk and his crew, subsequently passing away in the United States. It is believed that he was administered Polonium in Montenegro, had to flee the country whilst seriously ill.

Maatouk's culpability in the Randall murder has never been reported in Maltese media, giving rise to the presumption that the story was censored by the ruling Labour Party, which controls the press through the threat of withholding lucrative government advertising assignments. Muscat's covert control over all aspects of Maltese life insures that the truth about organized crime does not appear in the media. Whether Maatouk will ever be detained abroad, and extradited, remains an open question. 

USING OBSOLETE OR INEFFECTIVE CIP AT CLIENT ONBOARDING CONSTITUTES COMPLIANCE MALPRACTICE

A large percentage of compliance officers, who act as gatekeepers at their bank during the Customer Identification Process (CIP) continue to employ platforms that are either obsolete, or have become largely ineffective against professional money launderers driven to create credible yet bogus profiles for themselves and their criminal clients. We have observed a resistance to updating CIP programs and systems on the part of compliance directors to minimize increasing costs, and thereby appear frugal to the executives at their bank. 

This is not only a major mistake, it falls short of banking best practices, and could later be determined to constitute compliance malpractice, of outdated platforms and procedures, resulting in significant money laundering operations are later discovered by law enforcement agencies investigating narcotics trafficking or serious financial crimes. Nobody remembers that you saved money in your compliance program when your banks is named as the unwitting facilitator of the placement of large sums of criminal profits into the global financial structure. In my personal opinion, there's nothing worse than the negative publicity of seeing your bank's name in the media as the place where money launderers recently arrested deposited their profits for years with impunity.

As a former career money launderer, I can tell you that laundrymen also operate a risk-based, albeit criminal, program. They collect their own form of intelligence about likely banking targets for their future operations, including but not limited to assessing the effectiveness of not only your compliance department staff but more importantly the CIP program that you are operating. If you have a team of inexperienced compliance officers running legacy platforms, they are going to quickly test the actual effectiveness of your system, and if they enjoy success, will soon drive major amounts of dirty money right through your bank. If your program interdicts a test operation, they will steer clear of your bank, and look elsewhere for one where the gatekeepers in compliance are ineffective.

Please understand that many money launderers have years of hands-on banking experience themselves; they have represented or worked for banks, and many keep constantly updated on technical development in the industry. If you are not running next generation CIP software, trying to be economical by refraining from acquiring advanced systems, as a cost cutting measure, you may end up paying the price, when your department's abject compliance failures end up with your replacement as director or supervisor of compliance operations. 

There is often a cost savings to updating your CIP, as your compliance staff can work smarter, and more effectively when they can access next generation systems, rather than your antiquated legacy platforms. You may not have to hire more frontline compliance officers is your present staff can discharge their gatekeeper duties and responsibilities faster and more efficiently. Just remember, your worthy opponents in the money laundering world are watching you. If you are cutting corners with CIP, it will come back to bite you.

NEWS FROM SINGAPORE CONFIRMS THEIR SUSPICIONS ABOUT FAMILY OFFICES ENGAGING IN MONEY LAUNDERING

Regulatory authorities in Singapore are proposing to enact strict rules regarding the operation of family offices, which they will be required to adhere to, to become exempt from anti-money laundering laws. the fact that the Monetary Authority of Singapore (MAS) has taken these steps is the first indication we have seen, by any regulator, that there are well-founded suspicions of money laundering by family offices. 

Family offices, which are private entities that exist to invest and grow the assets of high net worth (HNW) individual and their extended families, have traditionally been regarded as low-risk, due to the fact that they have extremely limited clientele, and their clients, who earned their wealth in legitimate businesses or through inheritance, have high visibility in the financial world, and are often well known. But family offices often cross international borders in their investment operations, which elevates risk.

However, not all family offices cater to one specific family group, or a limited number of HNW clients; some service a large number of customers, and there have been a couple of high profile cases where family offices have either intentionally ignored a client's red flags of illicit activity, or unwittingly onboarded a customer who later turned out to be investig the laundered proceeds of crime. Thus, money laundering through a family office is not unthinkable.   

Additionally, the lure of lucrative profits presented by wealthy potential clients, whose Source of Funds or Source of Wealth is dodgy cannot be underestimated, in an industry which is essentially unregulated in many jurisdictions. It is not without significance that a number of hedge funds have converted their operation to become family offices, due to this loophole.

Remembering that money launderers are constantly seeking new financial sectors or industries to exploit for their clients, especially in jurisdictions where there are ineffective or corrupt regulatory agencies, and you have a perfect storm in the making. Laundrymen love to break ground in an area where they are not known to operate, because such new movement often goes unrecognized by law enforcement for a period of time, during which they move and clean a substantial amount of criminal proceeds. 

Therefore, compliance officers at international banks whose clientele includes a number of family office accounts should consider conducting enhanced due diligence investigations of the customer, and take a fresh look at the accounts, meaning instituting transaction monitoring, to rule out possible money laundering. Do not assume that all is as it should be with your family office clients. 

WE ANALYZE MONEY LAUNDERING TRADECRAFT OF $33m FUGITIVE BOGUS CHRISTIAN MISSIONARY JASON SHENK

We have conducted an analysis of the tactics employed by fugitive "Christian Missionary" JASON GERALD SHENK, who defrauded charitable organizations, and private donors of over thirty three million US Dollars,  while purporting to prepare, print and deliver bibles and Christian literature to recipients in the Peoples' Republic of China over a ten year period, using public records, in an effort to demonstrate the lengths to which international money launderers will go to clean and secrete the proceeds of crime. Shenk, who renounced his American citizenship, has disappeared abroad. He reportedly defrauded Amish and Mennonite charities, and is believed to have been a member of one of those groups.

Jason Gerald Shenk

While most financial crime journalists generally limit their coverage to the reporting of facts, we here concentrate upon analysis and commentary, so that compliance officers will learn from, and remember never to underestimate, the dark skills displayed by fraudsters employing advanced tradecraft.

First of all, Shenk must have had expert advice from experienced international money launderers, as he chose the most obscure and remote tax havens/offshore financial centers to both form his shell corporations, and to bank his illicit funds:

1. CONNECT ASIA BV: Samoa corporation, with bank accounts in Singapore. 

2. CLF ASIA LIMITED: British Virgin Islands corp, with Hong Kong bank accounts.

3. AUTUMNVALE GROUP LIMITED: Marshall Islands corporation, Singapore bank accounts.

4. He also had a number of US companies and LLCs, accounts at Bank of America & Citibank, in Georgia and North Carolina. Those accounts forwarded money abroad, and made "investments," which appear to be laundering operations.

In addition to reportedly transferring much of the money to bank accounts at ABN Amro Bank in Singapore and Hong Kong, Shenk:

A. Used $7m to run his family farm in the US.

B. Bought $850,000 in stock of a private nuclear energy company.

C. Bought $16m in insurance policies.

D. Bought 16 insurance policies with $4m.

E. Bought real estate in Santiago, Chile with $320,000. 

The fact that he was able to operate his fraud for a decade, permanently left the Continental United States, and remains a fugitive attests to the adequacy of the "professional" advice he received from his laundrymen. This is the type of externally legitimate, though career criminal, client that typically present the greatest challenge for compliance officers. He pushed an extraordinary amount of money through American bank accounts, and the fact that his operation was totally bogus was never discovered by his bankers, nor their compliance departments. Why he was never exposed by them we cannot say, but this is what a successful operation looks like. Govern yourselves accordingly.

OFAC SANCTIONS TWO SYRIA-BASED TERRORIST ORGANIZATIONS

Treasury Sanctions Two Syria-Based Militias Responsible for Serious Human Rights Abuses in Northern Syria

August 17, 2023

WASHINGTON —Today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is designating two Syria-based armed militias and three members of the groups’ leadership structures in connection with serious human rights abuses against those residing in the Afrin region of northern Syria. An auto sales company owned by the leader of one of the armed groups is also being designated.

The Afrin region of Syria is largely controlled by a patchwork of armed groups, many of which use violence to control the movement of goods and people in their respective territories. These armed groups have exacerbated the suffering caused by years of civil war in northern Syria and hindered the region’s recovery by engaging in serious human rights abuses against vulnerable populations. 

“Today’s action demonstrates our continued dedication to promoting accountability for perpetrators of human rights abuses, including in Syria,” said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. “The United States is committed to supporting the Syrian people’s ability to live without fear of exploitation from armed groups and without fear of violent repression.”

This action is being taken pursuant to Executive Order (E.O.) 13894, which authorizes sanctions on persons whose actions or policies further threaten the peace, security, stability,

or territorial integrity of Syria, or who, among other things, commit serious human rights abuses. 

ARMED SYRIAN MILITIAS 

The Suleiman Shah Brigade is a prominent element of the armed opposition to the Syrian government and a component of the Syrian National Army, a coalition of Syrian armed opposition groups. The Suleiman Shah Brigade operates in the Afrin region of northern Syria, where it exerts significant control over the civilian population. The brigade subjects the populace of this area to abductions and extortion. The brigade has targeted Afrin’s Kurdish residents, many of whom are subjected to harassment, abduction, and other abuses until they are forced to abandon their homes or pay large ransoms for return of their property or family members.

The Hamza Division, another armed opposition group operating in northern Syria, has been involved in abductions, theft of property, and torture. The division also operates detention facilities in which it houses those it has abducted for extended periods of time. During their imprisonment, victims are held for ransom, often suffering sexual abuse at the hands of Hamza Division fighters.

The Suleiman Shah Brigade and the Hamza Division are being designated pursuant to E.O. 13894 for being responsible for or complicit in, or for having directly or indirectly engaged in, the commission of serious human rights abuses against the Syrian people.

MILITIA LEADERS

Mohammad Hussein al-Jasim (Abu Amsha) is the leader of the Suleiman Shah Brigade. Under Abu Amsha’s leadership, members of the brigade have been directed to forcibly displace Kurdish residents and seize their property, providing vacated homes for Syrians from outside the region who are often related to fighters in the brigade. Abu Amsha also ordered the brigade to kidnap local residents, demanding ransom in return for their release and confiscating their property as part of an organized effort to maximize the brigade’s revenue, likely generating tens of millions of dollars a year. Abu Amsha allegedly raped the wife of a member of the brigade and threatened her and her family with harm if she did not remain silent. 

Al-Safir Oto is a car dealership owned by Abu Amsha that provides an outlet for Abu Amsha to invest his income. Al-Safir Oto is headquartered in Istanbul and operates multiple locations in southern Türkiye that are managed by commanders of the Suleiman Shah Brigade. Abu Amsha allegedly owns Al-Safir Oto in partnership with the leader of the Syrian armed group Ahrar Alal-Sharqiya, Ahmad Ihsan Fayyad al-Hayes, who was previously designated pursuant to E.O. 13894 for having acted or purported to act for or on behalf of, directly or indirectly, Ahrar al-Sharqiya .

Mohammad Hussein al-Jasim is being designated pursuant to E.O. 13894 for being responsible for or complicit in, or for having directly or indirectly engaged in, the commission of serious human rights abuses in relation to Syria.  Al-Safir Oto is being designated pursuant to E.O. 13894 for being owned or controlled, directly or indirectly, by Mohammad Hussein al-Jasim. 

Walid Hussein al-Jasim is a younger brother of Abu Amsha who also holds a leadership role in the Suleiman Shah Brigade, including serving as the head of the brigade when Abu Amsha left Syria to fight in Libya. On multiple occasions, the Syrian Islamic Council leveled charges against Walid related to sexual assault against women. As part of the brigade, Walid Hussein al-Jasim coordinated abductions, muggings, and ransoms. In addition, Walid reportedly killed a prisoner who was unable to pay ransom in 2020 following a month of abuse. 

Walid Hussein al-Jasim is being designated pursuant to E.O. 13894 for acting or purporting to act for or on behalf of, directly or indirectly, the Suleiman Shah Brigade.

BULK CASH SMUGGLERS ON BOARD BOMBARDIER GLOBAL T7-WSS ARRESTED IN ZAMBIA WITH USD$5.6m COMING FROM EGYPT

                           

Drug Enforcement Commission

ronptSedos5t711tug  f0u50f9: 4gcA8 a62u4c69mth1a20Aau2M113us  · 

PRESS RELEASE

Lusaka, Tuesday 15th August 2023

The Drug Enforcement Commission (DEC) received information that a chartered aircraft carrying dangerous goods had landed at Kenneth Kaunda International Airport on 13th August 2023 at 19:00 hours.

Acting on this information the DEC together with officers from various Law Enforcement Agencies conducted an operation on Monday, 14th August 2023 at Kenneth Kaunda International Airport.

The operation resulted in a seizure of the following items:

1. USD$5, 697,700

2. Five (05) pistols

3. Seven (07) magazines

4. 126 rounds ammunition

5. 602 pieces of suspected Gold weighing 127.2 kg

6. Equipment used for measuring Gold

The Commission has since seized the Global Express T7-WW on which the above items were found and another aircraft belonging to a local airline whose make is King Air B190.

The ten (10) suspects including a Zambian, have been detained awaiting further investigations.

Mr. Nason Banda

Director General

Drug Enforcement Commission

__________________________________

NOTE:

The Usual Suspects?: those arrested included one Latvian national, one from the Netherlands and

one from Spain. The ".999 Pure Gold" appears to be counterfeit. The aircraft, which had been previously photographed in Malta, was a charter, Flying Group Middle East (Dubai).