Alleged ‘king of money laundering’ arrested

By Christine Duhaime | November 6th, 2010

Colombia’s alleged ‘king of money laundering’ Oscar Fernando Cuevas, was arrested yesterday in Colombia, under an extradition warrant from Spain.

According to Colombia Reports, Cuevas made a fortune laundering money for the now-defunct Cali Cartel and the Revolutionary Armed Forces of Colombia (known as FARC) and is alleged to have laundered more drug money than anyone else in Colombia.

In 2001, he fled Colombia for Spain and sought political asylum. Spanish authorities believe he continued laundering drug money while he was in that country from 2001 to 2004.

In 2004, Cuevas returned to Colombia. Before that, he was extradited to the US for money laundering.

FATF seeks consultation on mutual evaluation standards

By Christine Duhaime | November 4th, 2010

In preparation for the 4th round of mutual evaluations, the FATF is reviewing the standards with which it performs its evaluations and has released a consultation paper for public input on the following topics: risk based approaches; tax crimes as a predicate offence for money laundering; customer due diligence mechanisms; politically exposed persons; and third party reliance.

Of particular note is the proposed change for life insurance companies. The FATF is proposing that life insurance companies focus their client identification efforts on beneficiaries of policies, in addition to the policy holders. The identity of first level beneficiaries will have to be ascertained and they will be subject to the domestic money laundering reporting and record keeping requirements, as well as second level or contingent beneficiaries (those who are named in a will as beneficiaries or belong to a class of beneficiaries, such as children in a trust). Politically exposed persons who are beneficiaries, or contingent beneficiaries, will be subject to an increased level of scrutiny.

The consultation document can be viewed on the FATF website here.

Omar Khadr sentenced to 40 years

By Christine Duhaime | November 1st, 2010

Convicted terrorist Omar Khadr has been sentenced to 40 years in prison by a U.S. military tribunal at Guantanamo Bay. Under a plea agreement he will serve eight years in prison. Khadr may apply to serve the remainder of his sentence in Canada after one year. The government is not obliged to agree to his transfer to Canada. Khadr pleaded guilty to providing material support for terrorism, murder and several other charges.

Vatican Bank pledges compliance with anti-money laundering rules

By Christine Duhaime | October 30th, 2010

The Institute for Works of Religion, commonly known as the Vatican Bank, has pledged to implement anti-money laundering legislation based on the FAFT Recommendations that would require it to report suspicious transactions, ascertain the identity of their clients, report large transactions and establish an anti-money laundering compliance regime. The Vatican Bank has also agreed to adopt the EU Directive 2005/60/EC on money laundering. The changes come after Italian prosecutors placed bank chairman Ettore Gotti Tedeschi and his deputy Paolo Cipriani under investigation and seized 23 million Euro from a Vatican Bank account.

Khadr pleads guilty to supporting terrorism

By Christine Duhaime | October 29th, 2010

Omar Khadr has pleaded guilty to multiple charges for his role in a battle with coalition troops in Afghanistan, including murder, attempted murder, supporting terrorism and spying. Khadr admitted to throwing a grenade on July 27, 2002, that killed Sgt. Christopher Speer after a four-hour firefight between al Qaeda affiliated forces and U.S. military forces, and that he threw the grenade with the intent of killing American or coalition forces.

Khadr also admitted that in the months prior to the battle, he converted landmines to explosive devices and assisted in the planting of ten explosive devices with the intent of killing American forces. His plea was part of an agreement under which he waived his right to trial and pleaded guilty in exchange for a limitation on his sentence. A panel of military officers will hear the evidence and determine Khadr’s sentence this week. Khadr is the son of al Qaeda supporters who immigrated to Canada. He has spent eight years in U.S. military prisons.

Holocaust survivors ask EC to investigate money laundering

By Christine Duhaime | October 28th, 2010

Holocaust survivors from the former Yugoslavia have requested that the European Commission start an inquiry to determine if their assets were laundered by financial institutions associated with the Vatican City State, according to this report in Bloomberg. The request to the EC is based on a 1997 U.S. State Department report that allegedly claimed the Vatican Bank laundered assets stolen from thousands of Jewish people killed or captured by the Usta¡a, the Nazi-backed regime in power in Croatia at that time.

The claims were the subject of a U.S. federal lawsuit filed against the Vatican Bank in San Francisco in 1999 by Holocaust survivors from Croatia, Ukraine and Yugoslavia. The case was dismissed in December 2009 by a U.S. appeals court on the basis that the Vatican Bank is a sovereign entity entitled to the protection of the U.S. Foreign Service Immunities Act.

The Holocaust survivors approached the EC on the basis that it has jurisdiction over the Vatican Bank in matters related to money laundering.

Canada introduces immigration law to fight human smuggling and terrorist financing

By Christine Duhaime | October 25th, 2010

Canada has introduced new immigration legislation to further criminalize the smuggling of foreign nationals into Canada, particularly where there may be a connection to terrorist financing. The Preventing Human Smugglers from Abusing Canada’s Immigration System Act (Bill C-49) gives the Minister of Public Safety the competence to designate the arrival of a group of foreign nationals, such as the recent group of Tamil migrants who arrived aboard the MV Sun Sea, in Canada as an irregular arrival.

The designation can be made if the identity of the foreign nationals cannot be done in a timely manner or if there are grounds to suspect that the foreign nationals were smuggled into Canada in association with a listed terrorist group. The competence of the Minister to make the designation is retroactive to March 31, 2009 and will apply to the Tamil migrants who arrived aboard the MV Sun Sun and those who arrived aboard the Ocean Lady.

On arrival to Canada, designated foreign nationals will be held in detention for about a year so that their identities can be ascertained and to complete background investigations to ensure that their arrival does not pose a threat to Canadians from terrorism or terrorist financing.

The new legislation amends the Immigration and Refugee Protection Act, Balanced Refugee Reform Act, and Marine Transportation Security Act.

Dirty money in Australia’s slot machines

By Christine Duhaime | October 23rd, 2010

Australia’s slot machines are being increasingly used by money launderers to wash millions of dollars a week from the proceeds of crime according to this report in The Sydney Morning Herald. Crime gangs routinely visit Sydney casino hotels several times a night, inserting thousands of dollars in slot machines at a time. $10,000 can be washed in a few minutes.

Once a few bets are made, criminals cash out and collect a casino cheque for the portion of funds fed into the machine and not gambled. They often make several trips to their car to collect more cash, then return to the same machine.

As much as $2 million passes through the slot machines in a week at each of Australia’s top gambling spots, according to an analysis of figures from the Office of Liquor Gaming and Racing. Some hoteliers say some of the spots in Sydney are so well known to criminal gangs that they refer to them as LLs, slang for ”local laundries”.

Directors face 796 charges of money laundering

By Christine Duhaime | October 16th, 2010

According to the Malaysian Star newspaper, four directors of Genneva Sdn Bhd, a Malaysian corporation with operations in Malaysia, China, Hong Kong and Singapore, were charged this week with 796 counts of money laundering in Malaysia. The directors – Ng Poh Weng, Marcus Yee Yuen Seng, Chin Wai Leong and Liew Chee Wah are alleged to have laundered over $189 million at one bank over the course of two years. Genneva is a gold bullion trading company.

Standford’s legal fees not recoverable because of money laundering evidence

By Christine Duhaime | October 14th, 2010

A federal judge in the U.S has ruled that Lloyd’s of London is not liable for the US$20 million in legal fees that are likely to be incurred by Robert Allen Stanford’s defence team because there is a substantial liklihood of money laundering. Stanford was covered by a director’s insurance policy purchased by his Texas-based companies that was underwritten by Lloyd’s. The policy contained an exclusion for money laundering charges.

Although Stanford’s trial has not yet started, Lloyd’s resisted continuing to pay for Stanford’s legal fees on the basis that there was sufficient evidence of money laundering. Thus far, Lloyd’s has paid US$8 million for Stanford’s defence. Stanford was indicted in June 2009 with four other individuals, on charges of conspiracy to commit mail fraud, mail fraud, securities fraud, wire fraud, obstruction of an investigation and conspiracy to commit money laundering. He is accused of running a billion dollar Ponzi scheme that allegedly defrauded hundreds of investors in the U.S.

Download Stanford Indictment or  Download Stanford SEC Complaint.