Global Investigations Review - The law and practice of international investigations


Monday, 22 June 2020

Hong Kong brokerage company fined $3.3 million for AML breaches

The Hong Kong Securities and Futures Commission (SFC) said in a statement on 22 June that it has fined Hong Kong brokerage company Guotai Junan Securities HK$25.2 million (US$3.3 million) for poor internal controls and for breaching money laundering regulations.

The SFC said it found that between 2014 and 2015 Guotai Junan failed to ensure anti-money laundering safeguards were put in place on 15,584 third-party deposits or withdrawals.

Guotai Junan also failed to detect nearly 600 cases of market manipulation between 2014 and 2016 due to “a lack of adequate written trade monitoring procedures or guidelines and technical failures,” according to the statement.

BaFin chief: Wirecard scandal a “complete disaster”

The head of Germany’s Federal Financial Supervisory Authority (BaFin) has criticised Wirecard’s senior management and BaFin itself over their “complete failure” in handling allegations of financial misconduct at the payments company, according to Bloomberg.

Felix Hufeld reportedly said on a panel on Monday 22 June that the scandal was a “complete disaster”, blaming Wirecard’s management’s inability to discover the facts of the alleged misconduct, as well as auditors’ and BaFin’s failure.

Wirecard has recently admitted that it can not account for €1.9 billion in its accounts, possibly due to fraudulent transactions.

The Financial Times has reported on allegations of fraud and financial irregularities at Wirecard since 2015, including an October report alleging it had inflated sales and profits at its businesses in Dubai and Ireland. Wirecard previously sued the paper over the reports. 

Singaporean police charge businessman with fraud over North Korea sugar sales

Singapore police have charged the head of a commodities company with 19 counts of falsifying papers with intent to defraud over an alleged scheme to secretly sell sugar to North Korea between 2014 and 2016. 

The police said in a statement on 19 June that the businessman and an accomplice faked shipping invoices to hide their transactions with entities linked to the North Korean government from two banks.

Various media outlets have identified the businessman as Tan Wee Beng, who the US Justice Department charged with bank fraud, money laundering and various conspiracy charges in 2018 in connection with the same alleged scheme. He remains at large, according to information on the FBI’s most-wanted list.

Zimbabwe launches unexplained wealth campaign

The Zimbabwe Anti-Corruption Commission (ZACC) has launched an operation targeting rich individuals’ sources of wealth, according to Zimbabwe’s Sunday News.

ZACC chair Justice Loyce Matanda-Moyo reportedly said the investigation is “an intensive lifestyle audit” of the rich to combat corruption in the country. 

The agency can use unexplained wealth orders to compel individuals suspected of corruption to account for specified assets or risk them being seized, according to a 2019 amendment to the country’s Money Laundering and Proceeds of Crime Act.

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