WHAT ABOUT ALL THE OTHER LAWYERS AT MOSSACK FONSECA ?

The Panama City law firm of Mossack Fonseca, exposed by the Panama Papers as an organization in business to hide the identities of their clients, and their dirty money, behind the shield of bearer share corporations, and bogus foundations, does not proudly share the names of its lawyers (except the two name partners) with the public. Go to the firm's large website, and while the firm extols the training, experience, legal education, and purported professional reputation, it does not, curiously enough, name its lawyers.

I have, in the past, been to the firm's offices, and there were no shingles posted, proudly naming the partners, associates, and of counsel who practice there. Given that these attorneys assist the firm's clerical staff in forming those non-transparent BVI companies, as well as corporations in far-flung, and often obscure, tax havens, for dodgy clients, they are a problem for compliance. Compliance officers should be aware of the names of these MF lawyers, for should they encounter one, while conducting a due diligence investigation, it is a major red flag, given the firm's long and sordid history of facilitating money laundering, tax evasion, and potentially, terrorist financing. As the gatekeeper, you know the dangers these individuals potentially pose to North American and EU financial institutions.

Therefore, since there is no official firm roster of MF lawyers, we will be extracting their names from publicly-available documents and web resources, and publishing them here. Finding any one of these lawyers' names on documents presented at account opening should set off alarms in your head, if not throughout your entire office.

Valentin Ureña III
Josette Roquebert
Li An Chong Vieto
Luis Eduardo Concepción
Ana Morales
Edison Teano
Ramses Owens
Daphne Durand

We shall endeavor to obtain the balance of the names and publish them here, as a public service. Remember, when the firm closes, these individuals will all be out there looking to lateral into another Panama law firm. Would you hire a lawyer who formed offshore companies for criminals at his or her last job ?

Contributed by Kenneth Rijock

Chronicles of Monte Friesner

AVOIDING THE CONSEQUENCES OF COMPLIANCE MALPRACTICE: PART ONE

If you are Compliance Officer, charged with protecting your financial institution, or MSB, from money launderers, financial criminals, and terrorist financiers, the personal and professional risks associated with failure to identify and suppress problems, what we now call compliance malpractice,  or professional negligence, have grown exponentially in recent years.

No longer are you only concerned with termination of your position, compliance failures now carry additional, and much more serious, risks, such as:

(1) Being unofficially blacklisted in the financial community, through word of mouth, poor employer references, and even telephone calls warning potential new employers off. You end up working outside the financial industry altogether, at a greatly reduced salary.

(2) Civil fines and penalties, imposed by a regulatory agency. You are also publicly named and shamed, in agency and law enforcement press releases, which remain online indefinitely, and stigmatize you professionally. You story will end up in the media, to your extreme embarrassment and chagrin. 

(3) Being suspended from your position and duties for a period of time by regulators, during which time you must be working somewhere else. The chances of returning to your original position generally become extremely slim, under those circumstances. More public shame accompanies this action, and your invitations to lecture at future compliance conferences and seminars, as a speaker, disappear.

(4) Being indicted, in a Federal criminal case, which generally means conviction and felony record, which, besides probation, or imprisonment, also brings with it a loss of Civil Rights. You spend time in a Federal Prison Camp, with low-level drug offenders, and after release, are further supervised for years, by the US Probation Office. It's like having a high school principal giving your orders, about where and when you can live, work, and whom you may associate with. Does that sound like fun ? It's not; You will become a pariah in your own community, and it will take years, if not decades, to repair your reputation and life.

In 2016, to avoid such untoward consequences, many compliance officers are doing what physicians, an often-sued profession, practice: we call it prevention. Go above and beyond the bare minimums, what we know as banking best practices, leaving ordinary, garden-variety due diligence behind, for total reliance upon enhanced due diligence, as a way of minimizing the risks of the compliance profession.

What are the most effective and efficient methods of performing enhanced due diligence ? I will discuss that in Part Two of this article; stay tuned.

Contributed by Kenneth Rijock

Chronicles of Monte Friesner

DONALD TRUMP SAYS IF HE IS ELECTED, HE WILL BAR ALL REMITTANCES FROM ILLEGAL ALIENS

He wants to ban remittances

If you did not see presidential candidate Donald Trump's immigration plan this week, you may have missed the part where he has promised that, if elected, he will use the USA PATRIOT Act to require all banks and money transmitters to confirm that senders of wire transfers and remittances are legally in the United States. Apparently, this is his scheme to make Mexico pay for the the construction of a wall, between America and Mexico, to cut off illegal immigration.

No only would such a program be impossible for financial institutions, and money service businesses, to effectively operate,  it probably violates a boatload (no pun intended) of existing US laws.

Contributed by Kenneth Rijock

Chronicles of Monte Friesner

MONTE FRIESNER EXPOSES: WHEN DO AMERICA'S BIGGEST PONZI SCHEMERS GET OUT OF PRISON ?

Lest you think that America's biggest Ponzi schemers skate on their crimes, after stealing millions from their victims, here is a list of the Federal prison sentences of the individuals that I have been covering on this blog in recent years. While the victims often lose their life savings, and feel that these sentences are often too light, I think that you will find that the punishment often fits the crime with these fraudsters.

If you are not familiar with any of them, use the search box on this blog, to locate their stories. I am listing the reported Bureau of Prison presumptive release date. Federal inmates must serve 85% of their sentences, and if they are guilty of infractions while incarcerated, they can lose that 15%, or a portion thereof, and be required to serve it as well.

(1) BERNARD MADOFF    (150 years)  November 14, 2139
(2) JOEL STEINGER           (20 years)     July 30, 2029
(3) NEVIN SHAPIRO          (20 years)     November 9, 2027
(4) SCOTT ROTHSTEIN    (50 years)      June 1, 2031 ? ( in WitSec-witness protection, no official estimated release date available)

Contributed By Kenneth Rijock

Chronicles of Monte Friesner

GERMAN MEDIA CLAIMS THREE IRANIAN BANKS WILL APPLY TO OPEN BRANCHES IN MUNICH

Parsian Bank

According to a leading Munich newspaper, three Iranian banks have advised the Minister of the Economy of the State of Bavaria that they have received approval, from Iran's Central Bank, to set up overseas branches, and that they all plan to open branches in Munich.

The banks are:
(1) Middle East Bank; head office, Tehran.
(2) Parsian Bank; head office, Tehran.
(3) Sina Bank; head office, Tehran.

What these bank branches will do to Country Risk assessments on Germany is something that compliance officers at EU banks will be considering, when these branches are approved, and become operational. 

Sina Bank

Contributed by Kenneth Rijock

Chronicles of Monte Friesner

HAMAS OPENS OFFICES IN TUNISIA

Hamas leadership in Tunisia.

A Tunisian news outlet, Al-Bilad, has reportedly announced that Hamas has opened offices in the country's capital, Tunis. Inasmuch as the Hamas "headquarters" in Turkey has been used to finance terrorist acts, both in the West Bank and in Europe, and to recruit and arm terrorists, it is reasonable to expect that the Tunis office, referred to as a headquarters, will not function as a diplomatic post.

This is extremely disturbing, for Tunisia, which has been the site of terrorist attacks that took a huge hit out of the country's precious tourist industry, does not need to facilitate the actions of a specially designated terrorist organization. There could also be assassination attempts made upon senior Hamas terrorists; this has occurred several times in the Middle East, and one wonders whether the Government of Tunisia has considered that Hams could be targeted in Tunis.

From a compliance standpoint, it raises risk levels for American banks whose clients include exporters to Tunisia, especially dual-use goods, which could easily be ordered by front companies, and delivered to Hamas, for further shipment. Also, there are other countries that have sanctioned Hamas, and compliance officers at banks in those nations should also pay close attention to what their clients send to Tunisia.

FEDERAL APPEALS COURT REVERSES $655m JUDGMENT AGAINST PA AND PLO ON JURISDICTIONAL GROUNDS

The Second Circuit Court of Appeals, in a 61-page opinion, has reversed the District Court's $655.5m judgment, entered against the Palestinian Authority, and the Palestine Liberation Organization. The suit, which was filed under the Anti-Terrorism Act, asserted that the two defendant entities were liable, for a number of terror attacks, in Israel, that killed or wounded US citizens.

The jury verdict, $218.5, was automatically trebled, pursuant to the Act. on appeal, the defendants argued that the Court lacked personal jurisdiction over them. The appeals court found

"In sum, because the terror attacks in Israel at issue here were not expressly aimed at the United States,    and because the deaths and injuries suffered by the American plaintiffs in these attacks  were 'random and fortuitous,' and because lobbying activities, regarding American policy  toward israel are insufficiently 'suit-related conduct' to support specific jurisdiction over these  defendants. Walden, S. Ct. at 1121, 1123." [opinion at 60].

The Second Circuit vacated the judgment of the District Court, and remanded, with instructions to dismiss the case, for lack of personal jurisdiction.  The plaitiffs' counsel has indicated that they will appeal; whether this will be a request for an En Banc hearing, or a Petition for a Writ of Certiorari, presented to the US Supreme Court, was not disclosed.

Readers who wish to review the complete text of the decision, may access it on the Second Circuit website here.