Wednesday’s Daily News Digest

March 23rd, 2011


EXCLUSIVE-Buddy can you spare $1bln? Cable shows Qatar gaffe

Reuters, March 22, 2011

Qatar sought $1.0-1.7 bln from oil, other firms – cable; Donations requested for flagship Sidra Medical Center; Companies “shocked and angered” by letters sent in 2008; Payments could be construed as breach of corruption law

By Ben Hirschler

LONDON, March 22 (Reuters) – Qatar, one of the world’s richest nations, stunned international oil companies in 2008 by asking them for more than $1 billion to help pay for a new medical centre, according to a leaked U.S. diplomatic cable.

The cash call angered companies involved, including Exxon Mobil and Royal Dutch Shell, and baffled U.S. officials, who saw it as a bad miscalculation by the energy ministry and Sheikha Mozah bint Nasser Al Missned, wife of the country’s ruler.

Read more…


Audio: Egypt’s Missing Millions

BBC 4 Radio, March 20, 2011

File On 4: Banks and fraud squads across the world are beginning the task of tracing a vast fortune stolen from the Egyptian people by members of the Mubarak regime. Some estimates have suggested the missing money could run into many billions of pounds. Ministers, businessmen and members of the president’s family have deposited vast sums in Swiss bank accounts and bought luxury properties in London. Where did all this wealth come from? How was the Egyptian government able to continue abusing its power for three decades? And could the regime’s business partners in multinational corporations really have been blind to what was happening? Fran Abrams travels to Egypt to investigate and to assess the chances of the money being recovered. Producer: Ian Muir-Cochrane.

Listen here…

Money Laundering

Justice Department To Target Money Laundering Gatekeepers

Wall Street Journal (Blog), March 22, 2011

By Joe Palazzolo

A Justice Department official said Tuesday that prosecutors are placing more emphasis on prosecuting lawyers, accountants and bankers who help corrupt foreign leaders and criminal organizations launder money.

Jennifer Shasky, chief of the department’s Asset Forfeiture and Money Laundering Section, told a group of bank compliance professionals that “identifying and prosecuting these facilitators…is a top priority of” her unit. At the same time, she said, the Justice Department and the U.S. Treasury are working with Congress on legislation that aims to curtail the use of U.S. shell companies as vehicles for money laundering.

Read more…

Police warn of global money laundering scheme

New Zealand Herald, March 23, 2011

People caught in global money laundering scams have been warned they could be prosecuted and face up to seven years in jail.

The warning came from Waikato police after a Hamilton woman, who answered an internet job offer, had $9000 deposited in her bank account.

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U.S. advises enhanced precautions against money laundering by N. Korean banks

Yonhap News Agency, March 22, 2011

By Hwang Doo-hyong

WASHINGTON – The Treasury Department on Monday advised U.S. financial institutions to take enhanced precautions against North Korea and Iran trying to launder money and engage in other illicit financial transactions.

In an advisory, the department’s Financial Crimes Enforcement Network (FinCEN) called on U.S. financial institutions to “continue to consult existing FinCEN and Treasury guidance on engaging in financial transactions with Iran and the DPRK.” DPRK is the acronym of North Korea’s official name, the Democratic People’s Republic of Korea.

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Tax Avoidance / Evasion

Budget 2011: £1bn tax avoidance crackdown dismissed as ‘token gesture’

The Guardian, March 23, 2011

Proper attack on tax avoidance would raise £20bn, say experts; Lib Dem election promise was to close £12bn in loopholes

By Simon Goodley

LONDON – George Osborne has been accused of making “token gestures” in his attack on tax avoidance after the chancellor pledged in his budget speech that a crackdown would boost receipts by £1bn.

Richard Murphy, a director at Tax Research UK, said: “I can’t remember a chancellor who didn’t say in a budget that he was going to raise £1bn by tackling tax avoidance. £1bn is the average raise. These are token gestures. If he was really serious, he would give HM Revenue & Customs a couple of billion a year to tackle this. I reckon they could raise £20bn.

Read more…

Argentina: 16 Arrest Warrants For Tax Evasion on Grain Sales

Dow Jones, March 22, 2011

By Shane Romig

BUENOS AIRES (Dow Jones)–Argentina has issued arrest warrants against 16 individuals for alleged black-market sales of soybeans and corn worth about 430 million pesos ($108 million), the national tax agency Afip said in a press release Tuesday.

The individuals involved were not named. The new arrest warrants are in addition to eight previously issued for an alleged conspiracy to avoid taxes on 650,000 metric tons of grain sales through a network of shadow companies, Afip said.

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General Corruption

WikiLeaks’ Assange: Indian PM ‘Misleading’

Wall Street Journal (Blog), March 22, 2011

By Tripti Lahiri

WikiLeaks founder Julian Assange, said India’s prime minister wasn’t being straight with the country in his response to allegations—contained in U.S. Embassy cables leaked by his organization—that the government used cash to try to buy supporting votes for a confidence motion it had to face in the summer of 2008. The vote took place after allies of the Congress party-led government walked out in opposition to the U.S.-India nuclear deal.

“The comments that I have been hearing from Prime Minister Manmohan Singh, these, to me, seem like a deliberate attempt to mislead the public by suggesting that governments around the world do not accept this material and it is not verified. Absolutely false,” said Mr. Assange, in an interview with news channel NDTV on Monday.

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China demonstrates intent to clean up corruption through law change

TrustLaw, March 23, 2011

The Chinese government has started to make inroads in its commitment to clean up corruption in the country by undertaking a review of the Criminal Law of the People’s Republic of China. The review has prompted significant changes to be made to Article 164 of the law, which deals with the bribery of foreign public officials in a commercial context. The addition of a commercial bribery offence under Article 164, according to law firm Baker & McKenzie, is striking as it suggests that China’s law enforcement bureaus are beginning to put foreign activity under scrutiny. What is also significant is that the amendments add to a provision which addresses bribery between and among commercial parties — an explicit reference to foreign public officials and international public organisations, according to Beatrice Schaffrath, a partner at Baker & McKenzie in Beijing. The amendments to the law will come into effect on May 1, 2011.

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For Canadian companies overseas, a corporate heart of darkness

The Globe and Mail, March 23, 2011

By Marcus Gee

When told that The Globe is doing a piece on the laws governing misbehaviour by Canadian companies in foreign countries, John McKay laughs. “That’ll be a short article,” he says. “There aren’t any.”

The Liberal MP was behind a private member’s bill that would have brought in tough new rules on companies operating abroad. It went down to defeat in Parliament last fall, losing by just six votes when the Conservatives opposed it.

Read more…

Written by Clark Gascoigne

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