Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week we cover the U.K. slapping Standard Chartered PLC’s with a fine for violating sanctions. Keep reading for this breaking story and find more news below.
U.K. Levies Sanctions Fine on Standard Chartered Worth GBP 20.47 Million:
British bank Standard Chartered PLC was fined GBP 20.47 million this week by U.K. authorities for violating sanctions that the E.U. imposed on Russia following the annexation of Crimea in 2014. The fine is the largest yet imposed by the U.K. Treasury’s Office of Financial Sanctions Implementation (OFSI), which was created in 2016. The penalty stems from loans that Standard Chartered extended to a Turkish bank owned by blacklisted Sberbank of Russia. Standard Chartered self-reported the breaches and took remedial steps. The penalty was reduced by 30 percent because of the self-disclosure of the violations, the detailed reports provided, and its overall cooperation with OSFI’s investigation.
Japan Businessman Admits Giving Gifts for Successful Tokyo Olympic Bid:
Haruyuki Takahashi, a Japanese businessman who received USD 8.2 million for his work for the now-canceled Olympics from the Tokyo bid committee, admitted that he had given gifts when lobbying International Olympic Committee (IOC) members. Takashi told Reuters some of the gifts he made IOC members included cameras and a Seiko watch which was found to cost USD 46,500. Takahashi stated it was normal to provide gifts to create good relationships with officials. IOC policies allowed officials to receive gifts of nominal value during the 2020 bid but stated no de minimis limit. The Tokyo 2020 bid committee also paid USD 2.3 million to a Singaporean consultant with the goal of winning IOC member Lamine Diack’s support. France began a probe on Diack in 2015 over a separate bribery allegation concerning the past Olympic games. Both Takashi and Diack have denied any wrongdoing.
SEC Issues 3 Whistleblower Awards Totalling over USD 2 Million:
The U.S. Securities and Exchange Commission (SEC) issued three separate whistleblower awards recently, totaling over USD 2 million. On March 23rd, the SEC issued an award of more than USD 1.6 million to a whistleblower that provided information on securities law violations that led to a successful enforcement action. The following day, the SEC announced another two awards amounting to USD 570,000 to two whistleblowers that provided information and help to the agency to lodge several different anti-fraud charges which resulted in successful enforcement actions. On March 30th, the agency was informed of another whistleblower award of more than USD 450,000 which brought the SEC crucial information on an ongoing compliance-related investigation that led to a successful enforcement action.
Casino Company Caesars Entertainment Fined Record GBP 13 for Failings:
A casino company in the U.K. has been fined a record amount of GBP 13 million by the U.K. Gambling Commission for systematic failure in VIP client treatment schemes. The casino company Caesars Entertainment, which runs 11 casinos, was found to have weak anti-money laundering policies in place for failing to check the source of funds of clients. Caesars was also charged for letting customers lose large amounts of money despite clear signs of gambling addictions. Three of its top managers have also lost their license to run a gambling business.
EU Banking Regulator Issues Money-Laundering Warning as Criminals Adapt to COVID-19
The European Banking Authority (EBA) warned financial institutions this week to pay closer attention to transactions linked to international trade as COVID-19 prompts criminal groups to seek new ways to move illicit funds and goods across borders. The authority particularly warns to be vigilant when processing payments linked to trade transactions where unexpected flows linked to customers or regions badly affected by the virus are involved. If flows are not reduced as expected, then extra attention should be paid to the nature and background of the transaction.
EU Opens Probe Against Fake COVID-19 Products:
The EU anti-fraud office (OLAF) has opened a probe into imports of potentially fraudulent products related to the fight against COVID-19. Some of the products under investigation include medical devices, sanitizers, masks, and test kits which might have been ineffective against the virus and fail to comply with EU health safety standards. The products enter the European market via online sales using fake certificates and can be found in normal distribution channels or the black market.
US Judge Grants Early Release to Brazilian in FIFA Corruption Scandal:
Brazil’s former Football Confederation president, Jose Maria Marin, was released from prison on humanitarian grounds after having served 13 months behind bars for corruption charges. Marin was found to be guilty of accepting USD 6.6 million in bribes by an NYC judge in 2018 in exchange for broadcasting contracts. The release was granted following a request by his Brazilian lawyers to consider his advanced age and elevated health risks due to the COVID-19 outbreak as well as his status as a non-violent offender and a service of 80% of his sentence.