Global Investigations Review - The law and practice of international investigations


Wednesday, 19 September 2018

DOJ investigating Tesla over Musk tweet

The US Department of Justice (DOJ) is investigating Tesla over public statements made by the company and its CEO,  Elon Musk, Bloomberg reported on 18 September.

According to Bloomberg, the DOJ opened a fraud investigation in August after Musk tweeted earlier that month that he was contemplating making the company private. 

Tesla reportedly said that it had received a voluntary request for documents from the DOJ. The company has said that it is cooperating with the probe. 

The Securities and Exchange Commission (SEC) reportedly sent a subpoena to Tesla in August after the tweet was sent. The SEC was already investigating whether Tesla misled investors about the production of its Model 3 car. 

Former Malaysian prime minister charged again

The Malaysian Anti-Corruption Commission said in a 19 September statement that former Prime Minister Najib Razak has been arrested and will appear in court on 20 September to face charges tied to the 1MDB scandal related to $628 million that appeared in his personal account.

Najib has not commented publicly on the arrest. 

Najib was charged on 8 August with abuse of power and criminal breach of trust for allegedly embezzling $10.5 million from the Malaysian Development Fund 1MDB. Najib pleaded not guilty to the charges and consistently denied wrongdoing.

Najib’s former lawyer Muhammad Shafee Abdullah was reportedly charged with money laundering on 13 September.  

NCA arrests former Pakistan Peoples Party officer

Officers from the UK National Crime Agency’s international corruption unit arrested a Pakistani politically exposed person and his wife on 17 September in connection with alleged money laundering in the UK believed to be the result of corruption in Pakistan.

The NCA said in a statement that the couple, which it did not name, “control a UK property portfolio worth more than £8 million for which they appear to have no legitimate source of income”. 

According to the BBCwhich identified them as former Pakistan Peoples Party officer Farhan Junejo and his wife, Binish Quresh, the arrests highlight major deficiencies in the UK’s anti-money laundering systems because the properties were bought several years after the investigation began. 

Pakistan’s Federal Investigation Agency has reportedly been investigating Junejo for alleged corruption since 2013.

Incoming head of Mexico financial watchdog will re-examine Odebrecht case

Mexico’s incoming financial intelligence chief has vowed to re-examine the Odebrecht case once he is in office, according to Reuters. Santiago Nieto will head the finance ministry’s Financial Intelligence Unit, which analyses suspicious financial records, once the new leftist government takes office on 1 December.

Reuters reported that Nieto said in an interview last week that the unit had been misused for political ends, but did not elaborate.

Nieto was dismissed in 2017 on the grounds that he broke a code of conduct when he gave an interview about his investigation into alleged Odebrecht bribery during the 2012 presidential campaign. Nieto denies breaking rules and at the time said his firing was illegal.

KPMG admits misconduct over FCA client asset reports for BNY Mellon

The UK’s Financial Reporting Council (FRC) announced in a 19 September statement that auditor KPMG and a partner at the firm have admitted to misconduct in relation to reports to the UK Financial Conduct Authority (FCA) on Bank of New York Mellon and its London unit’s compliance with the agency’s rules in 2011.

KPMG and Richard Hinton admitted to failing to adequately consider whether the records of custody relationships maintained by the banking group were compliant with the FCA rules. KPMG and Hinton also admitted to failing to undertake sufficient audit procedures to support 2011 client asset reports to the FCA.  

The FRC began its investigation into the matter in June 2015 following a referral from the FCA.

The FRC said that it will convene a disciplinary tribunal to decide what sanctions should be imposed.

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