KYC360 Weekly Roundup - 5th Aug 2022

Published on Aug 05, 2022

Spotlight on Human Trafficking


Human trafficking has no place in our world. Which is why this week we shine a light on this most wicked of crimes against humanity. Not only does it harm the well-being of individuals and communities, it undermines the very rule of law, compromises national and economic security, and helps fuel organised crime. 

The crypto sector has had a rocky ride over the last few weeks. Alleged sanctions violations by one of the world’s largest cryptocurrency exchanges, the first ever fine of its kind for significant anti-money laundering violations, and fears that the Metaverse will prove to be fertile ground for terrorism funding; have all raised question marks about how the sector can be regulated. 

Questions have also been asked about the effectiveness of sanctions, following revelations that sanctioned individuals have been exploiting a loophole in the UK’s new transparency laws aimed at forcing all UK companies to identify their real owners. 

To complete this week’s Roundup, we report on new policies and legislation, and delve into the world of money laundering, fraud, bribery, and corruption, to deliver the latest news from around the world.

It is estimated that there are a staggering 24.9 million human trafficking victims at any given time

Traffickers prey on adults and children of all backgrounds and nationalities, exploiting them for profit by forcing them to perform labour or engage in commercial sex. The world’s primary legal instrument to combat this pernicious crime is the United Nations Protocol which was adopted in November 2000 as part of the United Nations Convention against Transnational Organized Crime. 

Uyghur Forced Labor Prevention Act comes into effect in the US

The Uyghur Forced Labor Prevention Act (UFLPA) is a federal law that aims to ensure that no product “made wholly or in part” in China’s Xinjiang Uyghur Autonomous Region is imported into the US. The region is widely known for the use of forced labour and human rights violations against the Uyghur ethnic minority.

5 ways the UFLPA is making trade history

As soon as the UFPLA law went into effect, a group of experts with legal, advocacy, and regulatory backgrounds gathered for a roundtable discussion on the impact of the law. The outcome is that they believe the UFLPA is unlike any other of its kind and could have far-reaching trade implications and published five unique features and potential impacts to come out of this historic law.

Webinar: Mitigating the risk of Xinjiang forced labour in global supply chains using public data

US importers face the daunting task of auditing their supply chains for any inputs mined, produced, or manufactured wholly or in part in Xinjiang. This webinar presents a master class on how to use public records to mitigate the risk of using Xinjiang forced labour.

Traffickers are preying on millions of women and children who have fled the war in Ukraine

According to the UN’s refugee agency, over 5.9 million people have fled Ukraine since the start of the war; the vast majority are women and children. As traffickers use every trick in the book to dupe these most vulnerable people.

Republican Senator who voted against a sex-trafficking law, under investigation for sex trafficking

Matt Gaetz, who was among 20 Republicans to vote against reauthorising a sex-trafficking law has been under federal investigation since 2020 for an alleged offence with a minor that under U.S law constitutes sex-trafficking.

U.S. pornographer pleads guilty to sex trafficking

Matthew Isaac Wolfe is the fourth person associated with the GirlsDoPorn site to plead guilty to sex trafficking, in a case that highlights abuse within the adult film industry. The operators of the site repeatedly lied, manipulated, and coerced vulnerable women to engage in unwanted sexual activity on camera.

World Day Against Trafficking in Persons calls for sustainable technological innovations

With the global expansion in the use of technology, the crime of human trafficking has fully conquered cyberspace. Organisations such as the Anti-Human Trafficking Intelligence Initiative (ATII) are there to help companies combat global human trafficking by promoting corporate social responsibility, facilitating technology advancement, and encouraging strategic data collaboration.

FATF Report: Money Laundering and Terrorist Financing Risks Arising from Migrant Smuggling

The Financial Action Task Force (FATF) has published a report on the role of the public sector in tackling the money laundering and terrorist financing risks arising from migrant smuggling.


Financial_ServicesMoney Laundering, Fraud & Corruption

NatWest faces enforcement action by Isle of Man regulator over anti-money laundering controls

NatWest’s offshore banking arm faces new scrutiny, this time by the Isle of Man’s financial services regulator following a recent money laundering and counter-terrorist financing controls inspection. The Manx Financial Services Authority has referred Royal Bank of Scotland International to its enforcement division.

Fraudulent Caribbean resorts owner convicted over £226 million scam

The owner of celebrity-endorsed luxury Caribbean resorts has been convicted after an SFO investigation revealed he defrauded investors out of £226 million. David Ames deceived victims into thinking they were making a secure investment, knowing that the funding to build the resorts was never in place.

Shakira’s alleged tax fraud aggravated by widespread use of tax havens

ICIJ’s Paradise Papers and Pandora Papers exposed Shakira’s web of shell companies in offshore jurisdictions. Now Spanish prosecutors have called for an eight-year prison sentence and a huge fine over an alleged $15.5 million tax fraud aggravated by the Columbian popstar’s use of shell companies in tax havens.

€multi-million invoice fraud leads to arrest of nearly 100 people in Hungary

Supported by Europol, Hungarian authorities have cracked down on fraudsters targeting public sector companies. The Budapest Metropolitan Police has arrested almost a hundred individuals after unravelling two complex schemes involving invoice fraud.

Bain & Company banned from UK govt contracts over role in SARS capture

Global consultancy Bain & Company has been banned from UK government contracts for a period of three years over the role it played in facilitating the capture of the South African Revenue Service (SARS). Lord Peter Hain recently claimed Bain was employing staff in London who “colluded” with former president Jacob Zuma and asked that the government to ban the company.

Prince Charles accepted £1m from the family of Osama Bin Laden

The Prince of Wales is reported to have received a payment of £1m from the family of Osama Bin Laden. He is said to have accepted the money on behalf of the Prince of Wales’s Charitable Fund (PWCF) from two of Osama Bin Laden’s half-brothers in 2013, two years after the al-Qaeda leader was assassinated.

German city shuts down betting shops amid money-laundering allegations

Bremen, Germany’s smallest city-state has issued rejection notices to 32 establishments that had applied for betting licences under a new gambling law aimed at combatting money laundering. The betting shops have until 5 August to challenge the decision or supply paperwork showing how they obtained their startup capital.

UK parliamentary committee: no confidence that COVID-19 procurement contracts were awarded properly

A select committee investigation into the award of £777million in COVID-related contracts to healthcare firm Randox has concluded that it was “impossible to have confidence” that the contracts “were awarded properly”. The highly critical report underscores the need for urgent reform to bring lobbying out of the shadows, Transparency International UK said today.


RequirementsLegislation, Regulation and Sustainability

The UK’s new property register has come into force

Under the new Economic Crime (Transparency and Enforcement) Act, as from August 1st, 2022, the Register of Overseas Entities requires foreign companies with UK owned property to disclose the ultimate beneficial owners to Companies House, before making any application to land registries. Those who refuse face fines of up to £2,500 per day or up to five years in prison.

Tackling oligarchs will be even harder after UK law enforcement agencies asked to cut jobs

The National Crime Agency (NCA) and the Serious Fraud Office (SFO) have both been asked to cut their personnel count by up to 40 per cent.  If they go ahead, this will undermine the promises and commitments made by the UK government to combat kleptocrats and pursue corrupt Russian assets in the UK.

Opinion: the new economic crime bill will fail to address the evolving threat posed by financial crime

The recent economic crime bill aims to drive out dirty money and recover the UK’s reputation as a legitimate and open place for businesses. This opinion piece examines what this means for government policies and regulatory bodies, and whether it can counter the evolving threats posed by financial criminals.


Crypto-1Crypto & Virtual Assets

Robinhood’s crypto division fined $30 million by New York financial regulator

In the very first crypto-sector enforcement by the New York State Department of Financial Services, Robinhood’s crypto division has been fined $30 million for significant anti-money laundering, cybersecurity & consumer protection violations. The NYDFS alleges that it’s anti-money laundering and cybersecurity program was understaffed and did not have sufficient resources to address risks.

US Crypto Exchange Kraken suspected of violating sanctions

Kraken, one of the world’s largest cryptocurrency exchanges, is under federal investigation for allegedly violating US sanctions by allowing users in Iran to buy and sell digital tokens. With regard to legal requirements. Jesse Powell, Kraken’s Chief Executive stated that in his “formula for everything,” it was important to consider whether it’s “worth the risk to not follow the legal requirement.”

“Not following the law would by default be ‘ill-advised,’ but it always has to be considered as an option.”
Jesse Powell, Chief Executive, Kraken

UAE central bank fines exchange house $1.4 million for compliance failures

The fine was imposed after the Central Bank of the United Arab Emirates found that the exchange house had a weak compliance framework to prevent money laundering and financing of terrorism. The move is pursuant to the country’s federal law on anti-money laundering and terror financing which the central bank has been focusing on in recent years.

Online resource: Crypto regulations by country

Crypto regulations are fragmented across different jurisdictions, and they are constantly evolving. To help compliance professionals navigate the differences, there is now a free online resource that provides practical summaries of regulations and legislation about the state of crypto for each individual country.

Is the Metaverse a cyber-sandbox for terrorists?

While still in the developmental stage, the Metaverse aims to create a whole new virtual platform for information gathering, interactive communications, and counterintelligence. But observers are questioning whether it will have adequate safeguards to protect all the applications which are being developed for it and will it have the potential to be used for criminal or terrorist activity.



Sanctioned Russian oligarchs have exploited UK secrecy loophole

Sanctioned Russian oligarchs from Vladimir Putin’s inner circle have taken advantage of a UK secrecy loophole left open by the government. Companies, known as English Limited Partnerships (ELPs), weren’t covered by the new transparency laws aimed at forcing all UK companies to identify their real owners. As a result, ELPs have been linked not just to sanctioned individuals and entities, but to fraud, terrorism, and money laundering. 

Putin’s rumoured girlfriend sanctioned by US

A new round of US sanctions has targetted elites and includes a woman rumoured to be Vladimir Putin’s longtime romantic partner. The US government has frozen the visa of Alina Kabaeva, an Olympic gymnast in her youth and former member of the state Duma, as well as imposing other property restrictions.

US Russia designations for malign influence operations and election interference

The Office of Foreign Assets Control (OFAC) has designated Russian nationals Aleksandr Viktorovich Ionov and Natalya Valeryevna Burlinova. They are both said to support Russia’s global malign influence operations and election interference activities and OFAC also listed 4 entities linked to either Mr Ionov or Ms Burlinova.

Russia imposes travel bans on 39 UK politicians, businesspeople, and journalists

In response to Western sanctions, the Russian Ministry of Foreign Affairs has announced travel bans on 39 UK individuals. The list includes Sir Keir Starmer MP, David Cameron, David Lammy MP, Lisa Nandy MP, Ian Blackford MP, Alexander Cole-Hamilton MSP, David Aaronovich, Dan Sabbagh, Caroline Wheeler, Robert Peston, Piers Stefan Pughe-Morgan and Huw Edwards.

How a sanctioned ‘private military contractor’ is providing Russia with access to Africa’s wealth

It claims to be a private military contractor and the Kremlin denies any connection to it. Yet the Wagner Group (already the subject of U.S. and EU sanctions) has gained substantial footholds for Russia in Central African Republic, Sudan and Mali, giving Russia access to their oil, gas, gold, diamonds and valuable minerals.

US Issues fresh sanctions on Iran by targetting Chinese and UAE businesses

The US has sanctioned businesses it says are used by one of Iran‘s biggest petrochemical brokers to facilitate the sale of $millions of Iranian petroleum & petrochemical products from Iran to East Asia.


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