This week, while football fans worldwide were riveted by the closing stages of the FIFA World Cup, role-players in the fight against financial crime had their eyes on a different kind of ball game, as anti-corruption groups called on the EU Parliament to make sweeping reforms in the wake of arrests prompted by World Cup host Qatar-related allegations of corruption against EU member state representatives. Meanwhile, in the US, the country’s Senate knocked back a critical piece of anti-money laundering legislation, and federal prosecutors charged the founder and former chief of collapsed crypto giant FTX with fraud and money laundering.
Find out more on these stories below.
Qatar-related corruption arrests cause lobbyists to demand changes in EU parliament’s culture
Anti-corruption groups have called on the European Union Parliament (EU Parliament, or Europarl) to overhaul its operational culture, which they claim is the seed of the insalubrious activities which last week saw five member-state representatives, including a vice-president, arrested on charges of bribery, corruption, and money laundering in their dealings with officials from 2022 FIFA World Cup hosts, Qatar.
Investigators conducted raids on 19 properties during last week which reportedly yielded €1.5m in cash from three sites, one of which was an apartment belonging to a sitting EU parliament member.
Amnesty International, was scathing in its criticism, with its EU chapter director, Michiel van Hulten, stating that the EU Parliament “has allowed a culture of impunity to develop, with a combination of lax financial rules and controls and a complete lack of independent (or indeed any) ethics oversight.”
The EU Parliament’s Greens/EFA group was equally vociferous about the ‘cash-for-influence’ allegations, adding that “the Qatargate scandal cannot be allowed to tarnish the reputation of the European Parliament…It is now our duty to put in place the strongest possible measures to ensure that such corruption can never happen again.”
In response to the investigation and arrests, the EU Parliament removed Vice-President, Eva Kaili of Greece, on 13 December 2022. This was followed on 15 December 2022 by the EU Chief Prosecutor requesting that her immunity and that of one other parliamentary member be revoked. Qatari officials reportedly denied the allegations.
Read more on this story at The Guardian.
US Senate blocks Enablers Act in possible blow to America’s anti-money laundering framework
The US Senate, the Upper House of the US Congress, last week vetoed the Establishing New Authorities for Businesses Laundering and Enabling Risks to Security Act bill (Enablers Act), a piece of legislation that enjoyed support in the House of Representatives (the Lower House) from Democrats and Republicans alike, which advocates claim would vastly improve the country’s anti-money laundering (AML) regime.
The bill was intended to widen the scope of businesses and individuals subject to AML supervision and reporting and enhance the powers of relevant lawmakers and enforcement agents in the US, which would buttress the financial system’s defences against money laundering, drug trafficking, terrorism funding, and other serious economic crimes.
The Senate’s vote to not include the Enablers Act in the National Defence Authorisation Act (NDAA) for 2023 is a setback for supporters, whose ranks include over 20 foreign policy and national security thought leaders who penned a 16 November 2022-dated letter to both of Houses of Congress calling for the bill to be added.
Despite the Senate vote, supporters of the bill expressed cautious optimism about its future, with Democratic representative, Tom Malinowski, noting that “there’s support from national security experts, from Republican as well as Democratic administrations. I’m confident it is going to pass.”
Read more on this story at ICIJ.
US authorities charge FTX founder and ex-CEO with money laundering and fraud
The US Department of Justice (DOJ) announced on 13 December 2022 that Sam Bankman-Fried (SBF), whose cryptocurrency exchange company, FTX, collapsed collapsed in such spectacular and rapid fashion in early-November 2022, will face charges including money laundering, fraud, and conspiracy to defraud the US Government for his role in the debacle, which wiped out over $1b in customers’ and investors’ funds in days. The DOJ announcement followed confirmation on 12 December 2022 by the Attorney General of the Bahamas, Ryan Pinder, that SBF, who was laying low in the West Indian island state, had been arrested by officers of the Royal Bahamian Police Force.
The twin announcements ended weeks of media speculation about whether US and Bahamian authorities would pursue criminal charges against SBF, which Napier reported on here. While both sets of authorities hinted that SBF will face extradition to the US to answer to a Federal Grand Jury, he will also likely face criminal charges in the Bahamas.
The storm surrounding SBF and the FTX disaster even moved the Bahamian Prime Minister Philip Davis to comment, with him adding that “the Bahamas and the United States have a shared interest in holding accountable all individuals associated with FTX who may have betrayed the public trust and broken the law.”
Read more on this story at the Independent.
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