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U.S. Freezes Nearly USD 9.5B in Afghanistan Central Bank Assets

By Brad Fulton

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, nearly USD 9.5B in Afghanistan Central Bank assets are frozen. Read the full story and more news below:

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U.S. Freezes Nearly USD 9.5B in Afghanistan Central Bank Assets

U.S. authorities have frozen more than USD 9B in assets that belong to the Afghan central bank. Assets were frozen in an effort to thwart Taliban access to the funds. The U.S. has also stopped shipments of cash to the nation, seeking to keep U.S. funds from a now Taliban-led Afghan government.

Administration officials said that any funds and central bank assets in the U.S. owned by the Afghan government would not be available to the Taliban, as it remains on the U.S. Treasury Department’s sanctions list.


Former Justice Department Official Takes on Compliance Role at Walmart

Matt Miner, former official from the U.S. Justice Department’s criminal division, has been chosen to fill a role in Walmart Inc.’s compliance program as compliance chief. Miner formerly served as deputy assistant attorney general during the Trump administration.

The pick comes on the heels of the retail giant fighting a civil suit over its prescription practices. Prosecutors say that this is one factor that has led to the nation’s growing opioid crisis. Federal prosecutors last year filed a civil lawsuit accusing Walmart of failing to comply with the Controlled Substances Act. However, the company says that while Miner will oversee Walmart Inc.’s compliance program, which includes Walmart’s pharmacy business, he will not be involved in the current litigation surrounding the Justice Department’s opioid claims.

Fines for Money Laundering Breaches Drop 40% During Second Pandemic Year

Fines for money laundering against global companies fell sharply in the first half of 2021, officials say. Compared to the same period in 2020, the amount of fines imposed was cut nearly in half, down to about USD 930M, according to data compiled by Ireland-based fintech company Fenergo. This news comes despite the widespread predictions that financial crime would increase alongside increased work-from-home orders.

“In recent years, the enforcement actions levied against financial institutions have been at record highs as a number of major scandals were investigated and concluded by regulators,” Rachel Woolley, the global director of financial crime at Fenergo, said. “This year we’re seeing something markedly different, with the total value of fines issued at the halfway point of the year much lower than last year.”

However, firms still say that a rise in enforcement activity is possible and that an uptick in penalties given could still occur this year.


Netflix Insider Trading Ring Charged by SEC

The Securities and Exchange Commission announced Wednesday that charges of insider trading would be levied against former Netflix Inc. software engineers and associates who generated over USD 3M in profits by trading on confidential information about the company’s subscriber growth. According to the SEC, Sung Mo "Jay" Jun was at the forefront of a scheme to illegally trade on non-public information concerning the growth of Netflix's subscriber base, a key metric in Netflix’s quarterly earnings reports. The SEC alleges that Jun also relayed this insider information to his brother, Joon Mo Jun, and close friend, Junwoo Chon.

The SEC alleges that Sung Mo Jun's Netflix colleague, Jae Hyeon Bae, tipped off Jun to confidential information after he had left the company using encrypted messaging apps. The SEC uncovered the trading ring by using data analysis tools to identify the traders' improbably successful trading over time.

U.S. Telemedicine Owner Charged with USD 784M in Health Care Fraud

Creaghan Harry, a U.S. citizen who owned multiple telemedicine companies, was indicted last week on fraud and wire fraud, and multiple counts of income tax evasion for his alleged role in one of the largest Medicare kickback schemes ever brought forward by the Department of Justice. The scheme is believed to involve over USD 784M in false medical claims. Harry’s co-conspirators, Lester Stockett and Elliot Loewenstern have already pled guilty to the charges.

The latest indictment alleges that Harry, along with his co-conspirators, “solicited illegal kickbacks and bribes from durable medical equipment (DME) suppliers and marketers in exchange for orders for DME braces and medications.”

Harry faces a maximum of 20 years’ in prison if convicted of all charges. In addition, he also potentially faces five years for tax evasion, five years for conspiracy and 30 years for receipt kickbacks and money laundering.

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