Global Investigations Review - The law and practice of international investigations

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Thursday, 05 September 2019

Ukraine’s High Anti-Corruption Court starts work

Ukraine’s long-awaited anti-corruption court started work on 5 September, according to local reports.

The long-awaited High Anti-Corruption Court (HACC) was established as a permanently functioning specialised court in June 2018 as a condition of an International Monetary Fund aid package.   

A panel of the HACC's judges elected Olena Tanasevych, the former judge of Pechenizky district court of the Kharkiv region, as head of the new court in May and she will chair the court for the next three years.

Former White House counsel acquitted in landmark FARA trial

A jury in Washington, DC, found former Skadden Arps Slate Meagher & Flom partner Greg Craig not guilty of making false statements to the Department of Justice about his work in Ukraine when asked to register as a foreign agent.

On 4 September, reportedly after less than five hours of deliberating, the jury acquitted Craig. This was the second of two charges Craig faced — the court dismissed the first of the two charges against Skadden on 6 August, days before the trail began.

The Ukranian Ministry of Justice hired the firm in 2012 to write an independent report on whether the prosecution of former leader Yulia Tymoshenko was conducted to western judicial standards. 

Hong Kong extradition to China would help combat money laundering, says FATF

The lack of mechanisms for Hong Kong to extradite to and seek extradition from other parts of China “remain as impediments to [Hong Kong’s] surrender regime”, the Financial Action Task Force (FATF) has said.

In a mutual evaluation report on Hong Kong’s anti-money laundering and terrorist financing measures published on 4 September, FATF said that Hong Kong needed to explore ways to improve its ability to cooperate with China “through formal means”. The agency otherwise praised Hong Kong’s “sound” anti-money laundering regime.

Mass protests have engulfed Hong Kong in recent months after the government introduced a bill enabling citizens to be extradited to mainland China. Hong Kong’s chief executive Carrie Lam said on 4 September that the bill would be withdrawn.

US recommends a maximum 46 months in jail for ex-KPMG exec

US prosecutors have requested a jail sentence of between 37 and 46 months for former KPMG executive David Middendorf, who was found guilty of wire fraud in March.

In a court filing on 4 September, US attorney for the Southern District of New York Geoffrey Berman argued against Middendorf’s request for a non-custodial sentence, stating that the defendant “has had every opportunity in life” and “is clearly someone who knows right from wrong”.

Middendorf was convicted in March of taking part in a scheme to improperly help KPMG pass inspections by the Public Company Accounting Oversight Board.

Middendorf is scheduled to be sentenced on 11 September.

Malaysia seeks to recoup $950 million from 1MDB subsidiary

Malaysia’s finance minister said on 4 September the country is planning civil action to recover $950 million in funds loaned by scandal-ridden sovereign wealth fund 1MDB to its subsidiary SRC International, according to reports.

The loan was transferred to several offshore entities as well as BSI Bank in Switzerland and Julius Baer in Hong Kong. Malaysian and US authorities believe approximately $4.5 billion was misappropriated by 1MDB between 2009 and 2014.

Minister Lim Guan Eng reportedly said the government was working with “relevant authorities” to track the funds and with lawyers to determine the civil action that could be pursued to recover the money.

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