THE MEDIA NEEDS MORE ATTORNEY-JOURNALISTS TO REPORT CORRECTLY ON COMPLEX FINANCIAL CRIME CASES

To properly and correctly report on the details of complex financial crime cases, especially money laundering, the journalists who write those articles should, with rare exception, be attorneys. We are seeing, time and time again, errors and mistakes when the cases are reported by journalists whose educational backgrounds generally do not go beyond the humanities. Rarely will you find a practising journalist who has even taken criminal law cases at the undergraduate level, as most of them concentrate on a programme designed to train them in the preparation of all types of stories. I note with approval that the Times of Malta has an attorney-journalist, but they are rare in the industry.

I do not make this claim because of my own qualifications; readers, especially professionals who might be able to glean something of use regarding their representation of their own clients, deserve accuracy, please. If there is something that occurred in a case of great public interest, report it accurately.

Look at the current issue of Malta Today,  which contains an important story entitled "Pilatus Money Laundering: Arrest Warrants not yet Served to Bosses," written by Matthew Vella. In that article, Mr. Vella that Pilatus Bank owner/CEO/Chairman ALI SADR HASHEMI NEJAD was "acquitted" of sanctions busting charges. He further stated "charges were dropped,"  which leads readers to conclude, erroneously, that Sadr was NOT convicted by a jury of his crime, which occurred. It was only due to reputed Prosecutorial Misconduct (failing to timely deliver evidence to defence counsel, a  Brady violation) that the verdict was set aside and the case Nolle Prosequi, which means the Government decided not to go forward with its case. He only mentions the truth, the conviction, in a sideboards on Page 4, but on Page 1 he asserts an acquittal, which did not occur.

Knowledge of specific criminal law statutes, which is as far as most journalists go when examining a complex criminal case, fails to consider the subject of Criminal Procedure. It is the rules of procedure which are often the reason a court may enter a specific ruling, regarding Substantive Law. and the failure of non-attorney journalists to grasp procedural issues often result in errors in reporting. Many journalists use the term "innocent" when reporting on Sad'r case; in truth and in fact, he was anything but that. A jury of his peers found him guilty; that result was reversed only because the trial judge, already upset because the aggressive prosecutors at SDNY had allegedly violated Brady, either the spirit or the letter of that decision, had learnt of late-delivered Discovery.

This is just one of many errors I typically find in articles discussing Federal cases, whether criminal or civil, because the writer did not understand the importance of a procedural point. In US vs. Bruce Bagley, all the reporters noted that Professor Bagley received a mere six month sentence for money laundering, apparently due to his advanced age and poor health. What the Judgment and Notice of Commitment (the sentence) actually stated was conviction on two counts, with six month sentences, to be served concurrently, meaning simultaneously. 

 He also was not given any post-sentence Supervised Release, which is extremely rare. Supervised Release keep tabs on defendants after they have served their sentences. A lawyer-journalist would have pointed out the significance of these details. Most reporters ignored them altogether, as well as Bagley's relationship with his client, Alex Saab Moran, who is awaiting trial in Miami on money laundering charges.

I note with approval that there are some media that do employ seasoned journalists who have acquired the necessary tools; the Miami Herald's  Jay Weaver, with over 20 years of experience is the exception; his excellence in reporting Federal Court cases is based upon that experience. Most are young reporters short on knowledge of the criminal justice system they are covering. That way, the media doesn't have to pay them huge salaries.

Let's have more lawyers, especially those with criminal defence experience, make a career change, ald lateral over to reporting on a field which they are intimately familiar with; complex criminal cases, whether they be local, Federal or appellate. Nobody else is better qualified to tell those stories.

 

EXECUTIVE ORDER IMPOSING SANCTIONS ON FOREIGN PERSONS INVOLVED IN THE GLOBAL ILLICIT DRUG TRADE

 

 

 

 

HALKBANK TO PETITION THE U.S. SUPREME COURT WITH ITS FAILED SOVERIGN IMMUNITY DEFENCE IN CRIMINAL CASE

 

Turkiye Halk Bankasi A.S., more commonly known as HALKBANK, the Turkish-government owned bank accused by the US of assisting in a massive Iran sanctions evasion programme, will apparently be filing a Petition for a Writ of Certiorari to the United States Supreme Court. The Second Circuit Court of Appeals has reportedly stayed the District Court criminal case, allowing the bank to seek redress in the High Court. Both the District Court (SDNY) and the Second Circuit held that the Sovereign Immunity Defence would not apply to the bank, under the Commercial Activities exception. 

Given that the Government has secured the cooperation of the Iranian-Turkish dual national, REZA ZARRAB, and has had several years to accumulate documentary evidence, the outcome of any jury trial against the bank is fairly certain, although one can never predict what a judge or jury will do.

Given the established law on the Commercial Activities Exception to the FSIA, and the fact that the Court found that Halkbank qualified under all three categories, the bank's ploy with SCOTUS may only delay the inevitable trial in New York, which will probably impact the already poor relations between the United States and an increasingly authoritarian Turkey, now labouring under Strongman rule, as it ignores the Rule of Law.

When the petition has been filed, we will update our readers accordingly.

WILL THE NEW MIAMI MEET ITS MONEY LAUNDERING CHALLENGES IN 2025 ?

 

 

Existing, under construction and planned future buildings, Miami's Brickell Avenue District

 

If you haven't visited Miami recently, it is in a state of rapid change. The Brickell Avenue financial district, now as densely packed as Manhattan, due to a massive commercial and residential building boom, is featuring still more extremely tall condominiums, hotels and office buildings. The Magic City is once again living up to its name.

While progress has been Miami's hallmark in recent decades, due to its climate and geography, additional new factors, such as the relocation of a large number of professionals working remotely, the emergence of a high tech sector in the local economy, due to a favorable tax environment, and the targeting of ultra-high net worth clients by luxury residential developers, have all created a perfect storm of constriction at a torrid pace.  

What this means for compliance officers is that several multi-million dollar condominiums and office buildings are coming available each month for purchase. The buyers, most of whom are foreign nationals, will result in huge potential profits for the developers, but they also represent a high level of risk. While closing those transactions are the objective, insuring that sophisticated financial criminals accomplish the placement of the Proceeds of Crime in those projects, through effective enhanced Due Diligence policies and procedures, is a major goal that may or may not be achieved without unusual measures.

If you know your history, or are old enough to have seen what happened to Miami in the "Miami Vice" era of the 1980s, what is often referred to as the Golden Age of Money Laundering occurred, and drug money laundering was rampant, out of control, and unmanageable for the financial sector, as well as law enforcement. It took several years, the passage of the Money Laundering Control Act of 1986, and the shift in the movement of narcotics, which mainly entered through Florida, towards Mexico, before the problems lessened here. To say it was a difficult period is being kind; it was rough.

The city fathers in Miami sorely want us to forget about the trials and tribulations of those years, but today's bankers and compliance officers were not here 40 years ago, and therefore never had to painfully learn the lessons of that dark period. Whether they are adequately prepared to fend off the money launderers of the 21st century, who use the Internet to facilitate bulletproof strategies and tactics, advanced technology, corrupt foreign officials, and tradecraft completely unknown to the average compliance officer, we cannot say, but it will challenge them in ways they must cope with, on a real-time basis, for today's compliance officers, realtors, bankers and developers can all end up in Federal Prison for Willful Blindness, should they fail to interdict dirty money.

The laundrymen barbarians will be at the gates of Miami; the question is, will the gatekeepers keep them out in 2025 ?

SEEKING TO VERIFY THAT YOUR TARGET IS AN ACTIVE MONEY LAUNDERER ? HERE'S WHY AN INTERNET SEARCH WON'T HELP YOU

 

If you are a compliance officer at an international bank, following up on some suspicious transactions you discovered, involving a professional (attorney, accountant, financial service provider), don't bother conducting an Internet search for any negative information on Google or other search engine. If it exists, it has cunningly been buried behind page after page of websites, usually constructed by an Internet reputation restoration technician. This individual has cleverly thrown a wide variety of Internet fluff, from many different places of origin, depicting your target multiple times as an honest, experienced professional, whose services are available to the legitimate public, extolling his qualifications, experience, charitable and public service achievements, and every type of Internet entry you can imagine. 

All this Web garbage, which invariably fills several pages, serves to convince even the most diligent inquirer that his target is clean & legitimate. It serves to push any news of a negative nature, such as an arrest for money laundering or other financial crime abroad, way, way back, where most people, thinking that page 10 or 30 cannot contain relevant entries, never venture into. Therefore, they give their target a clean bill of health, and their suspicions remain only questions, not supported by information that might require an enhanced due diligence inquiry, where the truth might just come out.

I am making this point because recently, I checked on a number of individuals, who have never been arrested, but are strongly suspected by yours truly of moving the proceeds of crime through the global financial structure. All of them had obviously used the services of some reputation restoration service to pollute the Internet with many, many entries, all of which were designed to insure that whatever negative information existed, it was deeply buried behind the huge volume of websites created solely for the purpose of creating a bogus Internet presence that told the reader their target was a legitimate, and thoroughly boring, individual, not that he was, in truth and in fact, a prolific money launderer. 

 The truth has been  pushed way back, where you won't see it, unless you have the rare habit of reading web search entries to the bitter end. Perhaps you might want to read your Internet search results backwards, from the least relevant; you might be surprised at what you find.

NORTH KOREANS SANCTIONED BY OFAC FOR WMD AND BALLISTIC MISSILE PROGRAMMES

ALAR, Roman Anatolyevich, Moscow, Russia; DOB 17 Jan 1973; nationality Russia; Gender Male; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214; Passport 719869648 (Russia) expires 25 Jun 2022 (individual) [NPWMD]. 
 
CHOE, Myong Hyon (a.k.a. CH'OE, Myo'ng-hyo'n), Vladivostok, Russia; DOB 20 Jan 1966; nationality Korea, North; Gender Male; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214; Passport 836210034 (Korea, North) issued 26 Apr 2016 expires 26 Apr 2021 (individual) [NPWMD] (Linked To: SECOND ACADEMY OF NATURAL SCIENCES). 
 
KANG, Chol Hak (Korean: 강절학) (a.k.a. KANG, Ch'o'l-hak), Shenyang, China; DOB 06 Sep 1962; nationality Korea, North; Gender Male; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214 (individual) [NPWMD] (Linked To: SECOND ACADEMY OF NATURAL SCIENCES). 
 
KIM, Song Hun (a.k.a. KIM, So'ng-hun), Shenyang, China; DOB 10 Apr 1978; nationality Korea, North; Gender Male; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214; Passport 745235023 (Korea, North) (individual) [NPWMD] (Linked To: SECOND ACADEMY OF NATURAL SCIENCES). 
 
O, Yong Ho, Moscow, Russia; DOB 25 Dec 1961; nationality Korea, North; Gender Male; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214; Passport 108410041 (Korea, North) issued 13 Oct 2018 expires 13 Oct 2023 (individual) [NPWMD]. 
 
PYON, Kwang Chol (a.k.a. PYO'N, Kwang-ch'o'l), Dalian, China; DOB 16 Sep 1964; nationality Korea, North; Gender Male; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214 (individual) [NPWMD] (Linked To: SECOND ACADEMY OF NATURAL SCIENCES). 
 
SIM, Kwang Sok (a.k.a. SIM, Kwang-so'k), Dalian, China; DOB 16 Sep 1971; nationality Korea, North; Gender Male; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214; Passport 745120331 (Korea, North) issued 19 Mar 2015 expires 19 Mar 2020 (individual) [NPWMD] (Linked To: SECOND ACADEMY OF NATURAL SCIENCES). 

The following entity has been added to OFAC's SDN List: 

PARSEK LLC, Sh. Entuziastov D. 54, Che 0 POM.VII CH K 9, Moscow 111123, Russia; Secondary sanctions risk: North Korea Sanctions Regulations, sections 510.201 and 510.210; Transactions Prohibited For Persons Owned or Controlled By U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214; Tax ID No. 7714789249 (Russia); Company Number 62817585 (Russia); Registration Number 1097746565366 (Russia) [NPWMD]. 

IN MALTA, CORRUPT POLICE OFFICERS AREN'T PUNISHED; THEY RECEIVE MEDALS FOR PROTECTING THE GUILTY

 

 

 

 Do you know what this is ? It's a medal, awarded to police officers in the Republic of Malta, for Long and Efficient Service. It was given, last February, to Assistant Police Commissioner IAN ABDILLA. The problem is Abdilla, more than anyone else in the Malta Police, is the individual responsible for seeing that his law enforcement agency willfully ignored: (1) the Panama Papers/Schembri/Mizzi scandal (2) Corruption in offshore corporations linked to Yorgen Fenech (17 Black) and Joseph Muscat (Panama) and (3) The Daphne Caruana Galizia assassination.

Mug Shot

 

Cashiered as the head of the Economic Crimes Unit, for what the Daphne Foundation called "incompetence, lack of initiative and blindness to the crimes of people involved in the assassination of Daphne Caruana Galizia," he was not only not sacked, but he received the above medal. Only in Malta, where corruption is king, Muscat is revered as a God, and bribery & kickbacks are the rule, rather than the exception, would a corrupt police commissioner be so lionised. It is truly The European Union's only Failed State.

 

Abdilla personifies all that is rotten in Malta's government. Will he ultimately ascend to the top position in the Malta police ? Heaven help the Maltese people if that happens. He will perpetuate what some observers are calling Malta, "the Mafia State."

Il Duce

 

 

READ OFAC ACTION AGAINST TD BANK FOR VIOLATIONS OF NORTH KOREAN AND KINGPIN SANCTIONS REGULATIONS

 

READ HOMEOWNER COMPLAINTS AGAINST FAY SERVICING LLC FILED WITH BETTER BUSINESS BUREAU

 

 

A review of a large number of the consumer complaints filed publicly against the mortgage servicing company FAY SERVICING LLC, with the Better Business Bureau (bbb.org) has revealed the full extent of the alleged misconduct homeowners are asserting that the company has committed against them ( N.B. $1.15m in Restitution and Disgorgement). Here is but a small sampling of what we found: 

1. Fay raised the payment amount on a handicapped homeowner's mortgage without notifying him of any legal reason for the increase.

2. Fay annually erroneously and incorrectly threatened a homeowner for not carrying hazard insurance, and improperly added fees to his mortgage, when he had insurance, and Fay had a record of his coverage.

3. Inflating payoff figures with additional penalties and interest fluctuations that show unfair business practices.

4. Fay refused to accept mortgage payments, and then charged foreclosure fees for a mortgage that was not in default.

5. Fay does not report on time payments on mortgages to credit reporting agencies; they only report it if the account is delinquent.

6. Fay is holding insurance funds in a loss draft account that are needed to make fire damage repairs. This denies the homeowner the right to repair or retain his home, whole actively seeking foreclosure.

7. Fay signed up a homeowner for deferred payments, without his knowledge or consent, resulting a  drop in his credit score.

8. Fay refused to assist homeowner complete a Short Sale.

There are many, many more. Feel free to access the BBB site to see the double-talk Fay responses; in many cases, they blame the homeowner for their lack of communication, or deny the truth of the situation. Why is this company not yet shut down by regulators ? It has permanently given Wells Fargo, who assigned servicing on many of its loans to Fay, a black eye with consumers.

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NOTE: readers who are not familiar with Fay Servicing may want to review at least some of our 12 prior articles on the subject:

1. Has the California Department of Justice targeted Fay Servicing ?

2. Victims Allege that Fay Servicing Attorneys made Material Misstatements of Fact in Foreclosure Proceedings  

3. Making America Homeless Again 

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RESEARCH NOTE: Using the white search engine feature to access the other cases, enter "Fay." 

 

 

DEFENSE LAWYERS WHO REPRESENTED ATTORNEY-MONEY LAUNDERER WERE ALSO CHARGED, BUT ACQUITTED

 

 

In a Baltimore Federal case certain to draw the attention of the national criminal defense bar, a lawyer who represented a lawyer in a money laundering prosecution ended up also charged with a Federal felony. KENNETH RAVENELL, a local criminal defense attorney, was represented at trial by Joshua Treem, who was charged with Obstruction of Justice, in connection with an affidavit and letter submitted to Court that were allegedly misleading. A private investigator, Sean Gordon, was also charged. 

Both Treem and Gordon were acquitted; Ravenell himself was convicted of money laundering conspiracy, although he was acquitted on several other counts, involving Racketeering, narcotics and Obstruction of Justice. apparently, the local criminal defense bar took offense to the indictment of one of their own while defending a lawyer-client, as improper conduct and a threat to lawyers in general.

WHY IS THIS CONVICTED PONZI SCHEMER, TWO YEARS AWAY FROM RELEASE, AT A HALFWAY HOUSE FAR FROM HOME ?

 

 

 

FRANCISCO ILLARRAMENDI, a former Venezuelan hedge fund manager/convicted Ponzi schemer from Connecticut, is currently residing in a Baltimore halfway house, according to Bureau of Prisons records, as you can see above, but he is at least two years from release, and he was a problem defendant and inmate from the start. What's wrong with this picture ?

illarramendi's pretrial release was cancelled, due to financial misconduct while out on bond; he went through lawyers like water, causing extensive delays, and he has the gall to demand release after his conviction . How can this a defendant who repeatedly tried to game the system, be given such favorable treatment ?  There must be something more to the story.

Our best educated guess is that he is somehow being used in an important DC District Court money laundering case, involving Venezuelan nationals. He may even be part of the Nicolas Maduro case. Tha's probably why he is being kept close to, but not in, Washington. He will be a trial witness against some major target. That's why such a problem child is receiving such good treatment.

 

 

 

READ THE LATEST TARGET OF MALTA'S FINANCIAL REGULATORS, TRYING TO CONVINCE THE FATF TO BACK OFF

 

 In a clear sign that the Government of Malta is desperate to extricate their country from the FATF Greylist, the FIAU, its financial regulatory authority, has imposed a significant fine upon a local investment fund, which heretofore has enjoyed a pass, whilst ignoring AML/CFT best practices, and disregarding both Source of Wealth and Customer Identification requirements. We wonder how many years the FATF has known about the deficiencies at Southern Cross SCAV plc, and allowed it to operate with impunity.

 As time goes on, and there is no signal from the FATF that it believes that true reform is occurring in the Republic of Malta, especially indictments for money laundering and corruption amongst government officials, we can expect to see additional Administrative Measures, such as this € 303,710 Fine, but no movement to charge Malta's many money launderers, who are current or former senior government officials, such as disgraced former Prime Minister Joseph Muscat, and former minister Konrad Mizzi.

Know this: Surface measures, such as this one, simply will not cause the Greylisting to be removed, Mr. Prime Minister, so start bringing indictments ASAP.

 

 

 

ANOTHER DELAY IN ALEX SAAB MORAN CASE; MORE EVIDENCE OF COOPERATION ?

 

Alex Saab Moran's Antigua CBI passport.

 The trial judge in ALEX NAIN SAAB MORAN's Miami Federal case entered an order on January 4, postponing the selection of the trial date to a further hearing, now set for February 15, which cancels the scheduled January 7 hearing where the setting was to take place. The order recited that, had a hearing been held on the seventh, the defendant would thereafter been required to isolate for 14 days, which would have interfered with his ability to consult with defense counsel; thus the order in lieu of the hearing.

Whether this delay is an attempt to conceal the fact that Saab Moran is cooperating with law enforcement, as has been alleged by a number of court observers, cannot be confirmed at this time. One source asserts that Saab actually made a deal before he was extradited from  Cape Verde, but there is no proof available at this time to verify this allegation. Whether the case is set for a speedy trial when it next is called up for hearing may answer that question, but at this time, Saab's status as a possible CI is only an educated guess.

 

 

 

 

SECOND CIRCUIT DENIES HALKBANK'S MOTION FOR REHEARING OR EN BANC CONSIDERATION

 

Credit: Inner City Press

The Second Circuit Court of Appeals has denied, without opinion, the petition of Turkey's government-owned Halkbank (Turkiye Halk Bankasi) for rehearing of its recent decision allowing the criminal case pending in SDNY to move forward. The bank's counsel had  moved for a rehearing, or in the alternative, en banc consideration of its Sovereign Immunity defence. the 2nd Circuit held the case fell within an exception to the rule barring suits against foreign states.

The bank was seeking the dismissal of a pending case charging money laundering, IEEPA violations, bank fraud, and conspiracy counts, due to its ownership by the Government of Turkey. The Second Circuit decision has not, as of this writing, (9 January) been the subject of a Petition for a Writ of Certiorari to the United States Supreme Court, but it may still be filed before the deadline, being that it is a case many observers believe to be of great public importance, as it deal with evasion of US sanctions against Iran.

A check of the District Court docket today failed to reveal any post-appellate decision movement on the part of the US Attorney's office in New York; they may be waiting to see if a SCOTUS petition will be filed timely.  Considering that the primary defendant, REZA ZARRAB a/k/a Risa Sarraf, is a Cooperating individual, and he was the primary contact at the bank, the Government most likely has a strong case to bring to trial.

STANDBY LETTERS OF CREDIT ARE NOT WHAT THEY APPEAR TO BE

We have been warning the financial industry about the dangers of seeking to obtain a Standby Letter of Credit for decades, but we still see legitimate businessmen paying huge fees to secure one for a major transaction, and always experiencing a loss as the direct result. For the benefit of those who are not familiar with the term, a Standby Letter of Credit is defined as a legal document that guarantees a bank's commitment of payment to a party, in the event that the other party defaults on an agreement. Basically, it is paid when certain conditions have not been fulfilled. An SBLC functions as a guarantee of payment.

 

It is distinguished from an Irrevocable Letter of Credit, which is a guarantee of payment when certain specified conditions are met, and supporting documents are received by the bank.

 

Here's the problem; it is literally impossible to fulfill all the terms and conditions of an SBLC within the time frame required in the document. Victims who pay an obscene amount of money to obtain one find, to their dismay, that they cannot sufficiently comply with the complex terms in a timely manner. therefore, the SBLC becomes useless, and the desperately needed funds promised in the SBLC are never paid out by the bank.  Many financial crime experts point out that an SBLC is truly a license to steal; it will never be paid to those who purchase them in good faith. Those who offer SBLCs to the financial community know very well that their clients will never collect the funds offered by the financial instruments they sell. Banks are free to offer SBLCs without fear of regulatory action against them, because so long as the buyer knows what the requirements for payout are, they are legitimate financial products, it's just that you can't collect.

 Caveat Emptor, please, with SBLCs.

We have a report, from reliable sources, that some SBLCs are allegedly being offered to Iran, purportedly to help them evade international and US sanctions.