The International Enforcement Law Reporter

The International Enforcement Law Reporter is a monthly print and online journal covering news and trends in international enforcement law.

Since September 1985, the International Enforcement Law Reporter has analyzed the premier developments in both the substantive and procedural aspects of international enforcement law. Read by practitioners, academics, and politicians, the IELR is a valuable guide to the difficult and dynamic field of international law.

In Targeting Venezuela, the Trump Administration Targets Cuba

Saturday, April 13, 2019
Author: 
Alex Psilakis
Volume: 
35
Issue: 
4
Abstract: 

On April 5, 2019, the Trump administration announced its decision to issue sanctions against 34 ships owned or operated by Petroleos de Venezuela, S.A., the state-run oil company. The administration also levied sanctions against two international companies that ship Venezuelan oil to Cuba. Days later, on April 8, the Trump administration issued another ruling against Cuba, prohibiting Cuban athletes from playing in Major League Baseball (MLB) unless they defected. Although MLB officials asserted that they worked closely alongside the Treasury Department in 2018 before signing any sort of agreement with Cuba, the Trump administration displayed no hesitancy in striking down such a deal. Both of these decisions, which took place within a week of each other, reveal a new, serious strategy of the Trump administration: to pressure Venezuela and Cuba. While the Trump administration has unquestionably issued these sanctions to further tighten the financial stranglehold on Venezuela, one primary objective of these levies is to cut off the oil trade to Cuba. On average, Venezuela ships Cuba 20,000 to 50,000 barrels of oil a day. In response, Cuba shares intelligence and counterintelligence services with them.

Standard Chartered Bank Extends DPA for Violating Iran Sanctions and Agrees to More than $1 Billion in Penalties

Saturday, April 13, 2019
Author: 
Bruce Zagaris
Volume: 
35
Issue: 
4
Abstract: 

On April 9, 2019, Standard Chartered Bank (SCB), which is headquartered in London, England, agreed to pay more than $1 billion in penalties (including forfeiture of $240 million and a fine of $480 million) as well as to amend and extend its deferred prosecution agreement (PA) with the Justice Department for an additional two years for conspiring to violate the International Emergency Economic Powers Act (IEEPA). From 2007 to 2011, SCB participated in a criminal conspiracy, resulting in SCB processing approximately 9,500 financial transactions worth approximately $240 million through U.S. financial institutions for the benefit of Iranian entities. On April 9, 2019, the New York County District Attorney’s Office (DANY) also announced that SCB has agreed to amend its DPA with DNAY and extend it for two additional years, and to pay an additional financial penalty of $292,210,160.  In the amended DPA with DANY, SCB admits it violated New York State law by, inter alia, falsifying the records of New York financial institutions.  SCB has also entered into separate settlement agreements with the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), the Board of Governors of the Federal Reserve System (the Federal Reserve), the New York State Department of Financial Services (DFS), and the United Kingdom’s Financial Conduct Authority (FCA) under which SCB must pay additional penalties totaling more than $477 million.  The Justice Department has agreed to credit a portion of these related payments.  After crediting, the DOJ will collect $52,210,160 of the fine, in addition to SCB’s $240 million forfeiture.

U.S. Revokes Entry Visa for ICC Prosecutor over Afghanistan Row

Saturday, April 13, 2019
Author: 
Alex Psilakis and Bruce Zagaris
Volume: 
35
Issue: 
4
Abstract: 

On March 15, 2019, the IELR Blog detailed how the Trump administration pledged to block the entry of International Criminal Court (ICC) officials seeking to investigate U.S. personnel. On April 5, the Trump administration kept their word, revoking the visa of Public Prosecutor Fatou Bensouda. “We can confirm that the U.S. authorities have revoked the prosecutor’s visa for entry into the U.S.,” Bensouda’s office wrote. Since 2017, Bensouda, alongside her colleagues at the ICC, have been investigating alleged war crimes in Afghanistan. The investigation has reviewed allegations against all parties, including Afghan security forces and the Taliban, as well as U.S. personnel. The investigation may even expand to consider CIA activity within Afghan detention centers. A 2017 report from the Prosecutor’s office, which requested permission to launch the aforementioned investigation, made this clear, noting, “The information available provides a reasonable basis to believe that members of the United States of America (“US”) armed forces and members of the Central Intelligence Agency (“CIA”) committed acts of torture, cruel treatment, outrages upon personal dignity, rape and sexual violence against conflict-related detainees in Afghanistan and other locations, principally in the 2003-2004 period.”

While DHS Calls for Cooperation with the Northern Triangle, President Trump Seeks to Cut Aid and Close the Border

Saturday, April 13, 2019
Author: 
Bruce Zagaris
Volume: 
35
Issue: 
4
Abstract: 

On March 28, 2019, Secretary of Homeland Security Kirstjen M. Nielsen signed, on behalf of the United States, a Memorandum of Cooperation (MOC) on border security cooperation in Central America. Almost simultaneously, U.S. President Donald Trump said that he was planning on cutting U.S. assistance to the three countries and has threatened to close the border with Mexico. HSA Secretary Nielsen met with Guatemalan Minister of Government Enrique Degenhart, Honduran Security Minister Julian Pacheco, and Salvadoran Minister of Justice and Public Security Mauricio Landaverde The MOC – the first ever multilateral compact on border security – has the goal of improved synchronized cooperation between the countries to strengthen border security, prevent the formation of new migrant caravans, and address the root causes of the migration crisis through synchronized efforts.  It touches on the following:  human trafficking and smuggling; combating transnational criminal organizations and gangs; expanding information and intelligence sharing; and strengthening air, land, and maritime border security. The signatories will pursue each of these focus areas through an array of agreed-upon initiatives.  Technical working groups with representatives from each country will monitor the initiatives and ensure they are carried out expeditiously. The law enforcement groups will meet periodically throughout the year, with Secretary Nielsen and the Northern Triangle Ministers continuing to meet in the coming months to ensure continued momentum.

Elise J. Bean, FINANCIAL EXPOSURE: CARL LEVIN’S SENATE INVESTIGATIONS INTO FINANCE AND TAX ABUSE, 449 pp., Palgrave MacMillan, 2018, $49.

Saturday, April 6, 2019
Author: 
Bruce Zagaris
Volume: 
35
Issue: 
4
Abstract: 

The book is based on Ms. Bean’s staff leadership role on the Senate’s Permanent Subcommittee on Investigations (PSI) from 1999 to 2014, when Senator Carl Levin served in leadership positions on the PSI. A key theme is that constructive congressional oversight, especially when it is done on a bipartisan basis, goes to the heart of the United States democratic system of checks and balances.  Such oversight helps stop abuse, expose wrongdoing, and compel reform.  An additional theme is that the oversight investigations and hearings help develop a factual foundation for a shared understanding of a complex problem that often results in a consensus on remedies for the perceived abuses. The book sets forth the oversight process, which is composed of the following diverse phases:  designing the investigations; obtaining the facts through research, document requests, and interviews; discussing the investigative results; holding a hearing; and proposing remedies for the identified problems.

While DHS Calls for Cooperation with the Northern Triangle, President Trump Seeks to Cut Aid and Close the Border

Saturday, April 6, 2019
Author: 
Bruce Zagaris
Volume: 
35
Issue: 
4
Abstract: 

On March 28, 2019, Secretary of Homeland Security Kirstjen M. Nielsen signed, on behalf of the United States, a Memorandum of Cooperation (MOC) on border security cooperation in Central America. Almost simultaneously, U.S. President Donald Trump said that he was planning on cutting U.S. assistance to the three countries and has threatened to close the border with Mexico. HSA Secretary Nielsen met with Guatemalan Minister of Government Enrique Degenhart, Honduran Security Minister Julian Pacheco, and Salvadoran Minister of Justice and Public Security Mauricio Landaverde. The MOC – the first ever multilateral compact on border security – has the goal of improved synchronized cooperation between the countries to strengthen border security, prevent the formation of new migrant caravans, and address the root causes of the migration crisis through synchronized efforts.  It touches on the following:  human trafficking and smuggling; combating transnational criminal organizations and gangs; expanding information and intelligence sharing; and strengthening air, land, and maritime border security. The signatories will pursue each of these focus areas through an array of agreed-upon initiatives.  Technical working groups with representatives from each country will monitor the initiatives and ensure they are carried out expeditiously.  The law enforcement groups will meet periodically throughout the year, with Secretary Nielsen and the Northern Triangle Ministers continuing to meet in the coming months to ensure continued momentum.

Attempted Case of Wildlife Smuggling Reminds the International Community of Its Prevalence

Saturday, April 6, 2019
Author: 
Alex Psilakis
Volume: 
35
Issue: 
4
Abstract: 

On March 25, 2019, Indonesian authorities detained a Russian man accused of attempting to smuggle an orangutan out of the country. Andrei Zhestkov, the suspect, claimed that he purchased the animal from a market for $3,000, believing that he could bring it home as a pet. When Indonesian authorities discovered the orangutan inside one of Zhestkov’s suitcases at the international airport in Bali, they did not find an aggressive, terrified animal as they feared, but one sound asleep. Authorities uncovered allergy pills wrapped in plastic amongst Zhestkov’s belongings, which he had mixed with milk and fed to the animal, pacifying it for up to three hours. While he has not yet been charged, Zhestkov could face up to five years in prison, as well as fines of up to $7,000 for smuggling. Indonesian authorities have not charged Zhestkov because they are investigating if he is any way connected to wildlife trafficking syndicates. The case of Zhestkov is by no means unique. The illegal trade in wildlife is one of the most lucrative trades in the world. According to Interpol, the trade is valued at $20 billion a year. As it is so expansive, criminals often conduct other illicit activities in tandem with those toward wildlife, including money laundering, corruption, and document fraud.

Security Council Adopts Binding Resolution on Financing of Terrorism

Saturday, April 6, 2019
Author: 
Michael Plachta
Volume: 
35
Issue: 
4
Abstract: 

On March 28, 2019, the UN Security Council adopted Resolution 2462 in an effort to counter the financing of terrorism while avoiding unintended consequences for humanitarian activities in areas under the control of terrorist groups. The Security Council called upon Member States to step up efforts to combat and criminalize the financing of terrorists and their activities, adopting a resolution on the issue before holding a day-long open debate that placed the spotlight on international cooperation, capacity-building, and respect for international law. Unanimously adopting resolution 2462 (2019) under Chapter VII of the United Nations Charter, the Council reaffirmed its resolution 1373 (2001) — adopted in the wake of the September 11, 2001 attacks in the United States — which requires all States to prevent and suppress the financing of terrorist acts and to refrain from providing support to those involved in them. Adopted in 2001, resolution 1373 was the first comprehensive resolution imposing obligations on all states to respond to the global threat of terrorism. Resolution 1373 requires that states criminalize terrorist acts, penalize acts of support for or in preparation of terrorist offences, criminalize the financing of terrorism, freeze the funds of persons who commit or attempt to commit terrorist acts, and strengthen international cooperation in criminal matters related to terrorism.

As the International Community Unifies their Policy Towards North Korea, the White House Stands Alone

Saturday, March 30, 2019
Author: 
Alex Psilakis
Volume: 
35
Issue: 
4
Abstract: 

On March 12, 2019, the United Nations Security Council released a report outlining how North Korea has steadily and continually evaded sanctions imposed against it. Initiated by resolution 2407 (2018), the report strives to uphold resolution 1874 (2009), which requested that the UN Secretary-General create a “Panel of Experts” to assess how successful the international community had proven in sanctioning North Korea. It also sought to assess what recommendations, if any, the Panel had for future actions regarding the sanctioning of North Korea.[1] Referred to as the “Report of the Panel of Experts established pursuant to resolution 1874 (2009),” the report – penned by seven experts – covers the time period of February 2, 2018 to February 1, 2019. It notes the diverse array of steps that North Korea has taken to evade sanctions, while recommending how the international community may plug these loopholes and improve the overall effectiveness of sanctions imposed on North Korea. While a similarly-timed statement by the U.S. Department of the Treasury appeared to signal the U.S.’s eagerness to bolster the sanctions regime against North Korea, unpredictable comments by the Trump administration have thrown that belief into question.

European Parliament Adopts More than 200 Recommendations Against Financial Crimes and Tax Evasion

Saturday, March 30, 2019
Author: 
Michael Plachta
Volume: 
35
Issue: 
4
Abstract: 

On March 26, 2019, the European Parliament adopted a detailed roadmap towards fairer and more effective taxation, as well as tackling financial crimes. The recommendations, adopted by 505 votes in favor, 63 against, and 87 abstentions, were prepared over the course of a year by Parliament’s Special Committee on Financial Crimes, Tax Evasion and Tax Avoidance (TAX3). They range from overhauling the system to deal with financial crimes, tax evasion, and tax avoidance, notably by improving cooperation in all areas between the multitude of authorities involved, to setting up new bodies at the EU- and global-level. The Lux Leaks, Panama Papers, and Paradise Papers revelations shamed EU leaders and several governments in recent years, showing how corporations and individuals have resorted to dirty tricks and legal loopholes to dodge billions upon billions in taxes. As a result, the Parliament set up a special committee on financial crimes, tax evasion, and tax avoidance with the aim of tackling money laundering and corporate tax crimes (TAX3) on March 1, 2018.

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