Tether Hires Anti-Money Laundering Specialist as Chief Compliance Officer Read more: https://cryptovest.com/news/tether-hires-anti-money-laundering-specialist-as-chief-compliance-officer/

By Peter Genoff

Tether Ltd. recruited former anti-money launder quality control manager Leonardo Real as Chief Compliance Officer (CCO). Real, whose previous position was at Bank of Montreal, will be responsible for managing regulatory compliance issues within the organization. The company behind the USDT cryptocurrency announced its new appointment in a press release this Thursday.

“We are all very excited to introduce Leonardo as Chief Compliance Officer at Tether, as he joins us on what has already been a remarkable journey to date disrupting the legacy financial system,” said Jean-Louis van der Velde, CEO of Tether Ltd., in the announcement.

Tether (USDT) is one of the few alt-coins claiming to be backed by fiat money. The company behind the currency claims that they hold $1 in for every USDT in circulation. However, this claim has been challenged by other crypto experts, including cybersecurity expert Tony Arcieri, who published a detailed report in January.

Much of the controversy surrounding the cryptocurrency revolves around its association with the crypto exchange Kraken, and claims that Tether was used to manipulate Bitcoin’s prices to create the Bitcoin spike in December of 2017.

Tether’s new appointment comes after the company has repeatedly denied such claims in the past half year. Leonardo Real’s previous experience includes positions within the finance and funds compliance industries. According to the press release, at Bank of Montreal, Real was in charge of establishing policies and procedures “in line with regulatory requirements”. More importantly, he was also responsible for the quality control of anti-money laundering investigations.

“Joining Tether as CCO is an incredibly exciting move for me personally, and I am particularly impressed by the motivation, dedication, and talent of the Tether team. I look forward to helping showcase Tether’s commitment to transparency and regulatory compliance within the blockchain and cryptocurrency space,” said Tether’s new Chief Compliance Officer.


U.S. Banks Need Answers on New FinCEN Compliance

As May 11th, 2018 approaches, financial institutions across the United States continue to work towards ensuring their compliance with the latest set of regulations introduced by the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury that monitors financial data and proceedings in order to better combat financial crime and terrorist financing. The new legislation aims at both clarifying and strengthening customer due diligence (CDD) requirements for a variety of entities including federally regulated banks, securities brokers and dealers, and mutual funds, among others, extending the reach of current demands to the opening of new accounts. In the past, federal authorities have had their fair share of difficulties in identifying beneficial ownership – individuals defined as having 25% or more equity interest of a legal entity customer – of shell companies potentially engaged in illicit activity, due in large part to inadequate identification regulations. Thus the most noteworthy portion of the legislation contains new requirements for banks to both identify and verify the identities of the true beneficial owners of legal entity customers, in addition to making any necessary enhancements to their anti-money laundering (AML) practices – i.e. information collection, customer monitoring, and record-keeping.

Although U.S. banks have had advanced warning on the fast-approaching requirements (FinCEN’s “Final Rule” came into effect on July 11, 2016) the alterations seen within compliance departments of both prominent and small scale financial institutions throughout the country in response to these burdensome new obligations have been drastic, and have left these entities in a period of relative uncertainty, not to mention sending their compliance costs through the roof. While additional FinCEN guidance is expected in the coming weeks that may bring answers to apprehensive compliance officers, many have speculated that the move to increased AML due diligence could have profound ramifications on the global financial system, a collective network that the U.S. influences greatly. Others believe that the new regulations had been put off for far too long, and have allowed the significant issue that is concealing illicit financial activity within the U.S. to grow to unprecedented levels. The article “FinCEN AML compliance: between a rock and a hard place”, cited in BSA News Now on March 22nd, 2018, analyzes several challenges the new regulations pose to both U.S. financial institutions and those they are engaged in business with. Navigating through the robust regulatory landscape seen in 2018 is difficult in its own right, and the stakes that accompany the maintenance of compliance are only raised by the constant threat of financial penalties and subsequent reputational damage for even the most miniscule of errors. A contributing factor to potential faults is detailed in the text, as writer Angela Bilbow quotes an industry executive who states “financial institutions are caught between the systemic challenges of not having information from government authorities about an entity’s beneficial ownership at the outset of corporate formation and having to answer to their own regulators about it, such that they then have the responsibility to reach out to other stakeholders after the fact through their customer identification programme and other due diligence mechanisms to try and piece it together” (Bilbow, 2018). While data sharing practices have begun to commence between the U.S. and foreign countries as part of a global movement towards increasing financial security, these practices may also put the protection of important data at risk, specifically during the cross-border transfers of such information.

Another area of concern stemming from increased scrutiny in the sanctions compliance realm involves de-risking, a hot-button topic across the financial sector. The term “de-risking” pertains to instances that are becoming commonplace in today’s society, where financial institutions generally based in well-developed countries (i.e. the United States and United Kingdom) terminate or restrict their business accounts with certain categories of customer based on the perceived regulatory risks involved in dealing with said individuals. This practice has grown exponentially over the course of the past five years alone, and continues to have a crippling economic impact on numerous lesser-developed and “high-risk” countries around the world. Analysts believe the new regulations could have negative effects on transactions and deal flow, especially if banks begin to “superimpose requirements on potential customers and clients that go above and beyond what FinCEN is asking” (Bilbow, 2018). This could see banks setting an even lower threshold than the 25% beneficial ownership mark that FinCEN has called for, potentially dropping down to as low as 10% to ensure they have covered all bases in this regard. Given the wide variety of ways the new legislation can – and has already been – construed by compliance executives of American financial institutions, the turmoil surrounding the situation prior to the receipt of additional guidance is evident.

Japan will urge G20 to step up on preventing cryptocurrencies for money laundering, says government official

Via Reuters

Japan will urge its G20 counterparts at a meeting next week to beef up efforts to prevent cryptocurrencies from being used for money laundering, a government official with direct knowledge of the matter said.

Finance ministers and central bankers of the Group of 20 major economies will meet in Buenos Aires on March 19-20, with cryptocurrencies set to be on the agenda.

But the prospects for the G20 finance leaders to agree on specific global rules and mention them in a joint communique are low, given differences in each country’s approach, the official said, a view echoed by another official involved in G20 talks.

“Discussions will focus on anti-money laundering steps and consumer protection, rather than how cryptocurrency trading could affect the banking system,” one of the officials said.

“The general feeling among the G20 members is that applying too stringent regulations won’t be good.”

The Paris-based Financial Action Task Force (FATF), a 37-nation group set up by the G7 industrial powers to fight illicit finance, will report to the G20 its findings on ways to keep cryptocurrencies from being used for money laundering.

Japanese policymakers fear that while there is broad consensus among the G20 nations on the need for such steps, some nations have looser regulations than others, which leaves loopholes for money laundering, the official said.

Japan was the first country to adopt a national system to oversee cryptocurrency trading, although it carried out checks on several exchanges this year after the theft of $530 million from one exchange, Coincheck Inc.

France and Germany have said they will make joint proposals to regulate the bitcoin cryptocurrency market.

A head of the European Union’s watchdog said a short-term strategy could be to focus on applying anti-money laundering and terrorist financing rules, warning consumers of the risk of trading in cryptocurrencies and preventing banks from holding them.

The trick would be to apply regulations to protect consumers and prevent illicit activity, without stifling innovation in the fast-growing crypto-currency and fintech sectors, the Japanese officials said.

Fed fines Taiwan’s Mega Bank $29 million for anti-money laundering failures

WASHINGTON (Reuters) – The U.S. Federal Reserve Board said on Wednesday it had fined Taiwan’s Mega International Commercial Bank Co. $29 million for anti-money laundering violations and required the company to improve its anti-money laundering oversight and controls.

The Fed said its most recent 2016 inspection of the Taiwanese bank revealed “significant deficiencies” at its U.S. banking operations risk management and compliance controls relating to anti-money laundering and bank secrecy laws. The bank operates branches in New York, Illinois and California.

New York state authorities in 2016 slapped Mega International Commercial Bank with a $180 million fine for violations that included lax attention to risk exposure in Panama, the first time in a decade that a Taiwan-based financial institution had been penalized by U.S. authorities.

Are Artificial Intelligence And Machine Learning The Next Frontiers For Fighting Money Laundering?

Within the financial services sector, Anti-Money Laundering (AML) is a significant challenge for many institutions, often consuming large numbers of people and effort to manage the process and comply with the regulations.  As a result, these same institutions are looking for new solutions to help them reduce the burden and increase the controls in this complex space.   The combination of artificial intelligence (AI) and, more specifically, machine learning (ML), are increasingly being considered as enablers of a better solution.

Despite its potential, however, adoption of AI and ML within Anti-Money Laundering has been relatively slow.  This is due, in part, to the limited understanding of how AI and ML could be applied within compliance programs, and to the fact that regulators and compliance officers are often concerned that AI and ML are “black boxes” whose inner workings are not clearly understood.  Regulators typically require compliance officers to understand and validate not just the outputs, but also how the outcomes from AML models are derived.  Despite some of the concerns, we already see movement and application of these technologies.

Machine learning has been shown to be particularly useful in conducting suspicious activity monitoring and transaction monitoring, two key AML activities. A common challenge in transaction monitoring, for example, is the generation of a vast number of alerts, which in turn requires operation teams to triage and process the alerts.  ML can teach computers to detect and recognize suspicious behavior and to classify alerts as being of high, medium or lower risk.  Applying rules to these alert classifications can facilitate the automatic closing of alerts, allowing humans to supervise the machines that triage these alerts rather than reviewing all of the alerts manually, and making better use of the time of these experts.

Institutions leveraging ML can reduce their dependency on human operators to perform routine tasks, reduce the total time it takes to triage alerts, and allow personnel to focus on more valuable and complex activities.  There will always be a need for human involvement in the AML process; in fact, hybrid human/AI models and processes are the direction we see the function moving towards and should enable AML transaction monitoring to take a step forward in both the efficiency and effectiveness of alert operations teams.

To implement ML as part of a transaction monitoring solution, firms need to get key elements in place.  These include:

• High quality data.   All monitoring systems and analytics, not just ML applications, depend upon high quality data.  Static files such as Know Your Customer data as well as dynamic data on customer transactions held by financial services firms frequently have low completeness ratios in areas such as payment information, along with high error rates.  Profile refreshes, conducted as part of sales and marketing exercises, can update data while increasing customer outreach and identifying cross-selling opportunities.

• A 360-degree view of the customer.  Currently, financial services firms do not have the global freedom to share information about their customers to build a comprehensive network, and they do not formally collaborate on AML initiatives.  Regulators are, however, increasingly leaning toward data sharing between banks.  Over time, as ownership and privacy concerns are addressed, large amounts of transactional data could become available on intrabank data clouds, making a 360-degree view of the customer more feasible.

• Expertise in financial services and ML.  Very few people are experts in both ML techniques and financial services.  As a result, there have been fewer applications targeting financial services problems from start-ups and established vendors, limiting acceptance of ML within the sector.  Firms hiring ML experts can provide the needed financial expertise, if they institute appropriate training and development programs.

• Straightforward systems and processes.  ML is a relatively new technology and there are few established, straightforward processes to follow to implement it.  Without knowing what to look for, teaching systems to detect certain types of financial crime can be tricky.  For example, how does one teach a system to recognize terrorist financing?  There are more established processes for managing fraud, but nothing as comprehensive for terrorist financing, other than name matching against terrorist lists.

Financial services firms are making progress in addressing these challenges and their appetite for automation is increasing rapidly.  Many banks have started implementing business process automation in the form of Robotic Process Automation (RPA). In fact, robotics and AI/ML solutions can exist independently of each other and each can support the other’s capabilities.  Robotics can be used to train AI/ML models and AI/ML models can be used to add decision-making or reading capabilities to robotics models.

In Anti-Money Laundering, as in so many other areas of compliance, operations, risk and finance, AI and ML could be important steps in financial services firms’ journey to greater efficiency and effectiveness. These improvements in compliance and resilience capabilities can help to benefit firms’ shareholders and customers, make regulators’ jobs easier, and strengthen the global financial system

DOJ Announces a New FCPA Corporate Enforcement Policy

On November 27, 2017, at the 34th International Conference on the Foreign Corrupt Practices Act (FCPA), Deputy Attorney General Rod Rosenstein announced a revised FCPA Corporate Enforcement Policy, which purports to lend certainty for companies grappling with the question of whether to voluntarily disclose violations. This new policy comes on the heels of the year and-a-half long FCPA Pilot Program. Prior to introducing the new Corporate Enforcement Policy, Rosenstein touted the success realized through the Pilot Program—an increase from 18 to 30 voluntary disclosures over an 18-month period. The new policy seeks to incentivize companies to voluntarily disclose FCPA violations and cooperate with the Department of Justice (DOJ) in remedying the violation.

Most notably, the policy calls for different treatment of companies that make voluntary disclosures to DOJ and those that do not make voluntary disclosures, but otherwise cooperate with DOJ. For a company to avail itself of the most favorable treatment it must voluntarily self-disclose potential FCPA violations, fully cooperate with any responsive DOJ investigation, and timely and appropriately remediate any issues of foreign corruption. Meeting these requirements will lead to a presumption towards declination by DOJ of otherwise appropriate criminal charges “absent aggravating circumstances.” The qualifying limitation for “aggravating circumstances” is not clearly delineated, but the DOJ guidance does provide examples of potentially disqualifying circumstances, including “involvement by executive management of the company in the misconduct; a significant profit to the company from the misconduct; pervasiveness of the misconduct within the company; and criminal recidivism.”

In instances where aggravating factors are present and thus criminal enforcement action is warranted, the new policy provides a recommendation for reduced penalties. Namely, DOJ “will recommend a 50% reduction off the low end of the U.S. Sentencing Guidelines, except in the case of a criminal recidivist.” Guidance as to how DOJ defines criminal recidivism is not present in the policy. DOJ will generally not require a monitor if a company has implemented an appropriate compliance program.

DOJ will offer a scaled incentive for companies that do not voluntarily disclose potential FCPA violations, but subsequently fully cooperate and remediate underlying issues. Specifically, DOJ will recommend “up to a 25% reduction off of the low end of the U.S.S.G. fine range.”

In addition to satisfying the above standards, participation in the Corporate Enforcement Policy requires disgorgement, forfeiture, or restitution of profits traceable to FCPA violations. This amount often comprises a hefty portion of the overall cost of an FCPA violation, and DOJ exercises a wide degree of discretion in determining this amount. For this reason, the disgorgement, forfeiture or restitution component is an important consideration for those corporations evaluating the benefits and costs of pursuing a “declination.”

The new Corporate Enforcement Policy lends a degree of clarity to DOJ’s FCPA policy, which will enable companies to make more informed business decisions. Still, the policy is not binding, leaving ultimate enforcement decisions to the prosecutorial discretion of DOJ components and U.S. Attorneys’ Offices. The policy further leaves unanswered questions about how DOJ will apply the policy. Among these concerns are uncertain standards to determine whether a company has sufficiently “voluntarily self-disclosed misconduct,” “fully cooperated” with the government’s investigation, and “timely and appropriately remediated.” Beyond this uncertainty as to whether a company’s actions would be deemed sufficient to trigger favorable treatment under the policy, there is further uncertainty regarding the methodology DOJ, in its sole discretion, will use to calculate profits subject to disgorgement. Finally, because the policy calls for the public disclosure of not only FCPA convictions resulting in reduced sentences but also declinations of cases that would otherwise have been prosecuted but for a company’s compliance with the policy, companies must also consider the publicity of a disclosure in determining its best course of action.

Senator Warren says U.S. needs to ‘rethink’ money laundering laws

By: Michelle Price

WASHINGTON (Reuters) – Democratic Senator Elizabeth Warren said on Tuesday the United States needed to review outdated laws for combating money laundering which are creating an undue compliance burden for small and community banks.

During a Congressional hearing on Tuesday, Warren said she supported more stringent company ownership disclosure requirements and changing the threshold for reporting suspicious transactions in order to make life easier for small lenders and law enforcement.

“Money laundering is a massive problem … so everything we can do to crack down on that is good and that’s what we should be doing,” the Massachusetts lawmaker told the Senate Banking Committee. “But it seems to me we need to rethink a lot of our money laundering laws some of which … were written back in the 1970s and are badly out of date.”

The Committee hearing was the first of two to be held on U.S. anti money-laundering laws (AML), most of which were written in the 1970s and are out of step with the current financial landscape.

Much of the burden for identifying the proceeds of crimes such as tax evasion and human trafficking falls on the banking industry, which is required to monitor financial flows and produce millions of reports flagging suspicious transactions to the authorities.

U.S. watchdogs have dished out more than $16 billion in fines for AML compliance failings since the end of 2009, while banks globally spent an estimated $12 billion on AML compliance programs in 2016, according to data compiled by consultancy Quinlan & Associates.

Warren and others on the Committee agreed that updating broader money laundering laws, that would apply to bank clients and other intermediaries, could help make AML laws more effective while reducing the burden on banks.

Democratic Senator Mark Warner also called on the Committee to take a closer look at the implications of the rise of anonymous digital currencies such as bitcoin for combating money laundering, noting lawmakers needed to “get ahead” of the issue.

Western Union (WU) Faces $60M Fine for Lapses in Compliance

Western Union Co. WU will be paying $60 million on account of lapses in compliance programs during 2004-2012 period. Earlier, the world’s leading money transfer company accrued $49 million toward resolution of this matter

This payment will be made by Western Union to New York Department of Financial Services (NYDFS) to resolve violations of the state’s law arising out of the facts set forth in the deferred prosecution agreement (DPA) with the U.S. Department of Justice (DoJ).

The DoJ stated that during 2004-2012, Western Union violated U.S. laws as it processed hundreds of thousands of transactions for agents and others engaged in an international consumer fraudulent scheme.

As part of this scheme, fraudsters made contact with victims in the U.S. posing as family members in need or promised prizes or job prospects. The fraudsters compelled the victims to send money through Western Union to help their relative or claim a prize.

However, he NYDFS acknowledged that since 2012, the company made a concerted efforts toward enhancing compliance strategy. To this end, it has made significant investments in compliance spending. The company has also successfully navigated the Southwest Border Anti-Money Laundering Compliance Program, which indicates its inclination toward checking illegal money laundering.

The enhanced compliance program is being undertaken by the company to protect its well-established brand name.

Providing secure and legal transactions is one of the main purviews of a money transfer company and Western Union is trying its best to deliver on this.

This is also evident from a more than 200% increase in overall compliance funding by the company over the past six years. Western Union spends approximately $200 million per year on compliance and has more than one-fifth of its workforce dedicated to these functions.

Apart from investing in compliance, the company is also spending on technology to keep pace with the rapid shift in the space from physical to electronic money transfer. High compliance and investment costs are expected to pressurize the company’s bottom line. The company has also seen a weak top line growth since past many quarters due to soft volumes from oil producing countries, forex volatility, stiff competition and weak economy in some parts of the world.



The term “money mule” is commonly seen and heard throughout the financial services sector, specifically in recent years as financial institutions and federal regulators alike have aimed to halt the seemingly endless trend that is money laundering. A money mule is defined as a person who transfers money acquired illegally in person, through a courier service, or electronically, on behalf of others. These individuals have become a significant tool for criminals to use in the process of cashing out on their potentially compromised bank accounts. In the past, these schemes have targeted unknowing participants with personal and/or financial issues, offering them seemingly legitimate employment opportunities for distinguished positions such as “money transfer agent” or “payment processing agent.” Another common strategy has been the work-from-home (WFH) schemes, which have been “used by fraudsters and mule herders to entice witting or unwitting individuals into providing bank account details for the purpose of receiving an Automated Clearing House (ACH) deposit or counterfeit check. They are then instructed to electronically transfer funds to a third party, often in another country”, through money-service businesses in the form of wire transfers (Charles, 2017). These often utilize job search websites, social networking sites, and automated emails, where WFH offers are disguised to appear as a job opportunity from a legitimate company. In many cases these schemes can be difficult to detect, especially when widely-recognized trademarks and logos are used to help create the illusion of legitimacy. While each of these stunts has had success in their own right in years past, the international public has in large part grown wary of the typical means by which financial criminals have targeted potential mules in the past. However, criminals have turned to a new, more sustainable method that has already seen great success in 2017, and could continue to grow in the years to come.

The money mule trend has re-emerged as a hot-button issue today, as new reports from prominent global law enforcement agencies have shown that children and young-adults have now become the primary targets of criminals looking to move their dirty money. The article “New data reveals stark increase in young people acting as ‘money mules’”, cited in BSA News Now on November 28th, discusses recently released data from the United Kingdom’s fraud prevention service, Cifas, tying the growth of bank account misuse to younger populations. According to the report, there has been a “75 per cent rise in the misuse of bank accounts by 18 to 24 year olds in the past year, with 8,652 cases seen between January and September 2017” as compared to the same period in 2016 (WBWire, 2017). The most common trend in the misuse pattern has seen these youths acting as the aforementioned “money mules” – allowing their bank account(s) to be used to facilitate the movement of illicit funds. Experts believe that this latest development has capitalized on young and relatively naïve individuals, including students, who often have little to no cash flow.

Cifas, working alongside Financial Fraud Action UK (FFA UK), has begun a campaign titled “Don’t Be Fooled” to both educate and discourage younger generations from engaging in activity of this nature. One of the tactics most commonly employed by criminals to exploit this specific demographic is similar to those that were previously discussed. In these new cases, criminals approach students and young-adults with “what looks like a genuine job offer, asking them to receive money into their bank account and transfer it onto someone else, while keeping some of the cash for themselves” (WBWire, 2017). This offer seems like easy money for unknowing youths, requiring them to do little more than visit their local money transfer agency or perform a few clicks of a mouse. However, the repercussions of this activity can be severe, and can impact the futures of the individuals involved for years to come.

Statistics have also shown that money mule fraud has increased profoundly over the past five years alone, as cases involving 18-24 year olds have nearly tripled since 2013. This trend represents a significant threat to the general public in the areas where these tactics are being used, as the proceeds of this form of financial crime are often used in drug and human trafficking, large-scale money laundering and terror financing. One of the key points Cifas and FFA UK have made in their attempts to deter youths from engaging in this activity through their campaign is informing them that if they act as money mules, either wittingly or unwittingly, they are essentially involved in money laundering, albeit often at a small scale. They have also made sure to highlight the fact that it is very likely that this activity will be discovered given the wealth of new, sophisticated regulatory technologies continuing to emerge throughout the financial sector. If unearthed, their financial accounts will undoubtedly be closed, sending them in a downward spiral where they will likely face difficulties in opening accounts elsewhere, while also potentially impacting their ability to “obtain student loans, mobile phone contracts or other financial products” (WBWire, 2017). The groups have also made sure to touch on the most frightening reality involved with being a money mule – that is, a person convicted of money laundering could face up to 14 years in prison.

While the opportunity for a quick and easy payout can be enticing for individuals of any age, the repercussions of such activity could be catastrophic. As part of the “Don’t Be Fooled” campaign, Cifas and FFA UK have published a list of ways to avoid becoming a money mule. The 5 simple steps go as follows:

  • Do not give bank details to anyone you do not know or trust
  • Be wary of job offers where all interactions and transactions are done online
  • Be cautious of unsolicited offers of easy money
  • Research any company that makes you a job offer
  • Be wary of job offers written in poor English with grammatical errors or spelling mistakes






The European law enforcement agency Europol recently had a successful crackdown on the “money mules” discussed in this week’s feature article. Europol reportedly “uncovered $36 million in illicit money transfers and made 159 arrests in less than a week” over the week of Thanksgiving, and found that “Around 90 percent of 1,719 illegal transactions identified during the short campaign were linked to cyber crime, with cryptocurrencies like Bitcoin playing an increasing role in money laundering schemes” (Rumney, 2017). The latest campaign is the third relatively recent effort by law enforcement agencies and banks to combat mule operations and money laundering in Europe, with these entities now beginning to target the organizers and recruiters of these ploys, making their efforts much more effective.

The overall number of money mule cases in Britain increased by nearly 50% overall between 2016 and 2017, making the need for group coordination and cross-border cooperation to hinder this activity vital for the well-being of the financial industry in Europe and across the globe. That collaboration was evident in this latest effort, as “law enforcement agencies from 26 countries spanning the European Union, eastern Europe and the United States participated in the Nov. 20-24 campaign, along with 257 banks and private-sector partners, Europol, judicial cooperation agency Eurojust and the European Banking Federation” (Rumney, 2017).




An under-the-radar program undertaken during the presidency of Barack Obama re-emerged on the national stage recently, as the U.S. Department of Justice (DOJ) recently announced its plans to continue its enhancement of international cooperation and financial security. Enacted in early-2016, this program was designed to “encourage companies to voluntarily disclose paying bribes to foreign officials”, and swore to reduce penalties to both domestic and foreign companies that disclose information of this variety and cooperate with the Justice Department. Earlier this week Deputy Attorney General Rod Rosenstein proclaimed that a revised version of the policy will be incorporated to make the legislation permanent, making the program yet another potent tool in the global fight against corporate crime.

The goal of the program is to aid in the enforcement of the Foreign Corrupt Practices Act (FCPA), which made it unlawful for certain individuals/entities to make payments to foreign government officials to assist in obtaining or retaining business. The incentive-based system has promised companies listed on U.S. stock exchanges the chance to receive a 50% reduction in fines if they meet the current self-disclosure guidelines for reporting. Enforcement of the FCPA is likely to receive a significant boost following the announcement, although the program has already  been rather successful. The DOJ has indicated that “Since 2016, they have “obtained criminal resolutions in 17 corporate-related FCPA cases, resulting in penalties and forfeitures of $1.6 billion” (Farivar, 2017).




Unhappy with the recent string of scandals and crime seen across the Australian banking sector, Australia’s Prime Minister Malcolm Turnbull has called for a “wide-ranging” public inquiry to address the growing issue. In a formal address on the topic, Turnbull stated “the yearlong royal commission will examine the conduct of the nation’s banks, insurers, financial services providers and pension funds, and consider whether regulators have enough power to tackle misconduct” (Scott & Cadman, 2017). Although several of the country’s major banks had opposed an inquiry of this nature – due in large part to the potential ramifications that could ensue given the potential downturn of investor confidence – the banks eventually gave in in order to keep Australia’s sterling reputation as one of the world’s top financial systems intact.

Australia has been riddled with cases of AML law breaches and other improper financial activity in recent years. In fact, Australia’s four largest banks –  Commonwealth Bank of Australia, Australia & New Zealand Banking Group Ltd., Westpac Banking Corp. and National Australia Bank Ltd – which are “responsible for 80 percent of the nation’s loans, have been hit by allegations they gave poor financial advice, failed to honor insurance claims, mistreated small business owners and that some attempted to manipulate benchmark interest rates” (Scott & Cadman, 2017). Although he had been criticized for his over-tolerance in regards to these rather serious issues, Turnbull hopes his latest efforts will further ensure that Australia’s “financial system is working efficiently and effectively” (Scott & Cadman, 2017).

Saudi Crown Prince Says Islamic Military Counter Terrorism Coalition Will Eradicate Terrorism

Saudi Arabia’s Crown Prince Mohammed bin Salman (shown) said at the November 26 meeting of defense ministers in the Saudi capital of Riyadh that the Saudi-led Islamic Military Counter Terrorism Coalition (IMCTC) would “pursue terrorism until it is eradicated completely,” reported the Saudi-owned television news channel, Al Arabiya.

Al Arabiya reported a statement released by the IMCTC that quoted the crown prince as follows:

I express today our condolences to our brothers in Egypt, as a leadership and people, for what happened in the past days.

We will not allow them [terrorists] to distort our peaceful religion. Today we are sending a strong message that we are working together to fight terrorism. Today we affirm that we will pursue terrorism until it is eradicated completely.

The prince’s expression of condolences pertained to a November 24 terrorist attack inside a crowded mosque in the Sinai Peninsula that killed at least 305 people, making it the deadliest terrorist attack in Egypt’s modern history.

Arab News reported that Saudi Arabia announced the IMCTC alliance in December 2015. It consists of 41 countries and identifies as a “pan-Islamic unified front” against violent extremism.

The IMCTC, observed Arab News, employs an integrated approach to coordinate and unite its members on the four key domain areas of ideology, communications, counter-terrorism financing, and military strategy, “in order to fight all forms of terrorism and extremism and to effectively join other international security and peacekeeping efforts.”

During the meeting, IMCTC Acting Secretary General, Lt. Gen. Abdulelah Al-Saleh, outlined the coalition’s strategy, governance, activities and future plans.

Arab News, reported that the keynote speakers presented their perspectives on counter terrorism efforts in each of the IMCTC’s four key domains:

• “Dr. Mohammad Al-Issa, Secretary General of the Muslim World League, introduced the ideology domain, and the necessity of promoting a message that counters the narrative of violent extremist ideology and reaffirms Islamic principles of tolerance and compassion.”

• “Dr. Mohammad Al-Momani, Minister of State for Media Affairs of Jordan discussed the communications domain, and the importance of producing and disseminating factual, scholarly, and engaging content to undermine and counter the appeal of violent extremism.”

• “Dr. Ahmed Abdulkarim Alkholifey, Chairman and Governor of Saudi Arabian Monetary Authority, discussed Counter Terrorist Financing and the need to promote best practices and advance legal, regulatory, and operational frameworks in prevention, detection, and seizure operations.”

• “Pakistani General Raheel Sharif (Commander-in-Chief of the IMCTC) presented the military domain, which aimed to assist in the coordination of resourcing and planning of member country military CT operations; facilitate the secure sharing of military information; and encourage military CT capacity and capability building to ultimately deter aggression and violence.”

There are currently 41 nations that are members of IMCTC, all of which have Sunni-dominated governments. The alliance does not include any countries with Shia-dominated governments, such as Iran, Iraq, and Syria. Because of this makeup, Hakeem Azameli, a member of the Security and Defense Commission in the Iraqi parliament, called IMCTC “a sectarian coalition.”

A Reuters report noted that Qatar, which is a member of the coalition, was not present at the meeting. Qatar was not invited to the meeting after Saudi Arabia led a group of states seeking to isolate its small Arab neighbor on the Arabian Peninsula, charging that it supported terrorism. Qatar denies this assertion.

The report cited Abdulelah al-Saleh’s explanation that Qatar was excluded to help build a consensus among member countries.

We observed in a report on November 7 that Crown Prince bin Salman has assumed a more important role in Saudi Arabia since his father, King Salman bin Abdul Aziz, issued a royal decree on November 4 that named his son as the head of a newly established anti-corruption committee. The committee headed by the crown prince has the authority to investigate, arrest, issue travel bans, and freeze the assets of those it deems corrupt.

Muhammad bin Salman had been a key figure in Saudi Arabia for months before he was placed at the head of the anti-corruption committee and has been described as the power behind the throne of King Salman.