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The IMB aware of the escalating level of this criminal activity, wanted to provide a free service to the seafarer and established the 24 hour IMB Piracy Reporting Centre (PRC) in Kuala Lumpur, Malaysia.
A newsletter about fraud and global asset recovery from the office of International Chamber of Commerce's FraudNet. To read about key asset recovery cases and global compliance with anti-fraud and money-laundering laws, please click in the link above for the Newsletter PDF.
CCS offers a flexible membership arrangement based on the selection of predetermined membership packages. A prospective member can elect to join one or more Bureaux according to their requirements.
Losses due to official misconduct account for a great many maritime trade incidents. Each incident can be complex and wide-ranging in nature. It is therefore unlikely that any one company will have the knowledge and resources to be able to investigate it thoroughly.
Counterfeiting and piracy are a drain on our businesses and on the global economy. It has resulted in the widespread loss of lawful employment and a massive reduction of tax revenues.
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caylorl@bennettjones.com www.bennett jones.com |
Address
3400 One First Canadian Place
P.O. Box 130 Toronto, Ontario M5X 1A4 Canada |
Telephone
+1 (416) 777 6121
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Languages
English
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Protection Against Becoming ‘Easy Prey’ with Canadian Investments Leading commentators and writers about fraud, Al Rosen and Mark Rosen, have written another book exposing the obstacles faced by investors in Canada today. The authors are forensic and investigative accountants with extensive experience in providing investment advice and Court testimony.
Easy Prey Investors: Why Broken Safety Nets Threaten Your Wealth provides explanations of specific weaknesses in financial reporting requirements, most of which are being actively exploited, and also offers advice on how to spot their use. |
It is remarkable how the authors demonstrate the systemic failures Canadian investors are exposed to. Examining the issues in the context of collapsed or troublesome Canadian listed companies, their ultimate message is that investors now have no choice but to learn how to protect their retirement and other savings, whether they are invested in pension plans, mutual funds, or stocks and bonds. The authors argue that it is not just outright scam artists peddling Ponzi-like schemes but also portions of blue chip Canadian stocks that are riskier than they appear. Analyzing the history that led to this, they canvas a series of actions and inactions over the past two decades that resulted in, what they attribute to, the minimal protections available to Canadian investors today. Twenty years ago, the Supreme Court gave a narrow interpretation that significantly reduced the utility and reliability of annual audited financial statements for investors. Nevertheless, these same financial statements are used as the primary basis for investing by analysts and portfolio managers who fail to adjust them sufficiently, leading to incorrect assessments, overstated share prices, and investor losses. The book depicts an investment landscape that has since been plagued by ambivalence. The authors point to the ineffective steps taken by provincial securities regulators to deal with misleading financial reporting, several notable accounting collapses, and numerous pyramid-like or Ponzi investment structures that have resulted in widespread losses. They then point to what they cast as an ill-fated move by Canada’s external auditors – to allow a loosening of the accounting rules with the introduction of International Financial Reporting Standards (IFRS). At a time when other countries were busy tightening financial regulations, Canada, in their view, saw fit to do the opposite. The authors reveal the extensive power given to corporate management by IFRS to inflate reported income and cash flows, and craft figures that meet their lucrative compensation targets. The Rosens highlight that many corporate balance sheets now include assets with highly dubious values. They explain how this lack of transparency has extended from traditional sectors like technology and healthcare and now results in questionable values in industries such as real estate, pipelines, and telecoms, which have always attracted yield- and income-seeking investors and retirees. What’s more, according to their account, law makers have done almost nothing to demand that self-regulated bodies abandon their self-interested ways, and audits firms and securities regulators continue to serve the wants of their corporate clients, giving little attention to the needs of investors. Easy Prey Investors seeks to show us that investors in Canada now have no choice but to learn how to protect themselves. This book provides considerable advice and examples of Canadian-based financial trickery. It may just be too risky not to read it. Lincoln Caylor of Bennett Jones is recognized as a “leading counsel and commentator in the asset recovery field,” by Chambers Canada 2016, and is listed as a Most Highly Regarded Individual in North America by Who’s Who Legal: Asset Recovery 2015. The sole Toronto member of ICC FraudNet, he is internationally recognized for leading state-of-the-art asset tracing investigations and pursuing asset recovery litigation and enforcement actions in prominent, high-value international financial frauds and other economic crimes. ICC FraudNet is an international network of independent lawyers who are leading civil asset recovery specialists in each country. Recognized by Chambers Global as the world’s leading asset recovery legal network, our membership extends to every continent and the world’s major economies, as well as leading offshore wealth havens that have complex bank secrecy laws and institutions where the proceeds of fraud often are hidden. Founded in 2004 by the Paris-based International Chamber of Commerce (ICC), the world’s business organization, FraudNet operates under the auspices of the ICC’s London-based Commercial Crime Services unit. |
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Proactive Partnership Leads Battle Against Corruption Guatemala’s corruption environment is under scrutiny. Authorities have revealed that corruption has been, and is, present in almost every sector of the country’s economic and political activity. Guatemala’s high impunity rate (99.7 percent in 2015, according to the Attorney General’s Office) in corruption cases stimulates the growth of corruption.
However, substantial progress is being made. ‘Crusade’ Against Corruption The UN´s International Commission Against Impunity in Guatemala (“CICIG” in Spanish), in cooperation with a renewed Attorney General’s Office, have led a crusade to fight against corruption at every level, and dismantled entrenched criminal networks. This shows how an independent and technical organization, such as CICIG, in cooperation with the AG’s Office, can contribute to the improvement of transparency and accountability to strengthen the country’s institutions, including the courts and Tax Administration, and strengthen the rule of law. Their decisive and proactive strategy against corruption, armed with the use of technology and forensic capabilities, have enabled them to investigate, locate and take relevant actions against corruption in each of their respective fields. This has also had a positive impact on Guatemala’s financial health. In fact, in June 2016, Moody’s Investors Services announced the change in outlook on Guatemala’s ratings to stable from negative, and affirmed the Ba1 government bond and insurer ratings. |
Risky Business But, given this commitment to battle corruption, foreign businesses face a wide series of risks, including political/economic instability and increased regulatory uncertainty from local branches exposed to fraud and corruption activity. They face being subject to administrative review of local operations and criminal investigations for tax evasion, money laundering, trading in influence, and environmental pollution, among others. Additionally, foreign businesses that engage in corrupt acts may be subject to administrative sanctions, as well as the forfeiture of any assets that are related to the commission of corrupt acts. These risks are independent of potential breaches of international regulation and compliance, such as FCPA and the UK Bribery Act. Analyzing Guatemala’s most recent corruption scandals, authorities have discovered that a substantial part of the country’s corruption agents are located in business sectors involved in public contracting – niches where politicians charge illegal fees for the allocation of significant services offered by government agencies. These sectors include construction, technology, pharmaceutical, natural resources, communications and food services. Therefore, public procurement is the umbrella where foreign business sectors would be most vulnerable as of this date. Ensuring Compliance with Anti-Corruption Standards To protect that vulnerability and avoid violating Guatemala’s corruption rules, foreign companies need to engage proactive strategies and implement firm anti-corruption standards. These strategies include enhanced due diligence procedures to thoroughly identify counter parties, clients, third-party service providers, etc. Standards must be based on strict governance and compliance rules, and must be enforced, sanctioned and reviewed periodically as to assess, evaluate and respond to risk exposure to fraud, money laundering and corruption. Given the current environment in Guatemala, if they follow the rules, businesses can be sure they won’t get caught in the corruption dragnet. The author acknowledges the contribution of Juan Andrés Marroquín and Emanuel Callejas to the article. Rodrigo Callejas leads the insolvency and asset recovery practice at the Guatemalan law firm Carrillo y Asociados. His experience includes coordinating and obtaining recognition and enforcement of foreign judgments and recognition of cross-border insolvency processes before local, US, and European authorities. He is also lead multi-jurisdictional Latin American counsel for one of the largest international asset recovery/bank liquidations in history – the $5.5 billion Stanford International Bank (Antigua) Ponzi scheme. ICC FraudNet is an international network of independent lawyers who are leading civil asset recovery specialists in each country. Recognized by Chambers Global as the world’s leading asset recovery legal network, our membership extends to every continent and the world’s major economies, as well as leading offshore wealth havens that have complex bank secrecy laws and institutions where the proceeds of fraud often are hidden. Founded in 2004 by the Paris-based International Chamber of Commerce (ICC), the world’s business organization, FraudNet operates under the auspices of the ICC’s London-based Commercial Crime Services unit. |
- Details
snp@pcblitigation.com www.pcblitigation.com |
Address
4th Floor
90 Chancery Lane London WC2A 1EU DX: 0038 LDE United Kingdom |
Telephone
+44 (0) 20 7831 2691
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Languages
English
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Chinese-Related Disputes on the Rise As relationships between the West and China continue to develop, it is apparent that there has been a noticeable increase in Chinese-related disputes.
Easier Enforcement One cause can be linked to Chinese individuals and corporates rapidly acquiring overseas portfolios. With this, potential claimants are presented with a more readily available set of assets against which to seek to enforce their claims against such Chinese. Whereas previously potential claimants may have been put off by the prospect of enforcing in China, the prospect of looking elsewhere, as in the UK, may prove to be an important driver in the growth of litigation. At the same time, Chinese investors are being drawn into overseas litigation in pursuing claims. |
More Foreign Investments For example, with greater numbers of Chinese purchasing real estate in the UK, the prospect of them being caught up in fraudulent schemes is increased. Real estate in London has, for a number of years, been considered a sound investment for overseas investors. However, not all such investments end happily. Our clients include a group of investors, mainly based in the Far East, who purchased long leases for London properties that were supposed to be built. The building work barely started before the companies went into liquidation, with each of the investors losing the deposits that they paid. The person behind the scheme has apparently disappeared with many tens of millions of pounds unaccounted for. Additional Litigants In this case, we have targeted the lawyers who acted on the transactions. It is important to remember that in addition to the primary fraudster, whose assets may be difficult to find, those who were involved in the transactions and who may have the benefit of insurance or are otherwise wealthy may also have incurred a liability. Recoveries can also be made against the primary fraudsters. This usually requires the victims to act quickly in tracing and freezing assets – possibly in multiple jurisdictions on a simultaneous basis – before they can be further dissipated. Looking Ahead As China’s reported economic growth continues, these trends will continue to drive litigation with Chinese individuals and corporates. Additionally, Brexit stands to impact this trend, as the UK looks to foreign markets and as trade between the UK and China grows. Steven Philippsohn is a leading authority on complex international asset recovery. Over the last 30 years his firm has been retained by governmental, national and international organisations. A founding member of ICC FraudNet, he is listed by The Times of London as one of the 100 key influential legal professionals in the United Kingdom. Among his firm's highlighted work is representation of the primary defendant to a $1 billion claim (one of The Lawyer’s Top 20 cases for 2014 and 2015). ICC FraudNet is an international network of independent lawyers who are leading civil asset recovery specialists in each country. Recognized by Chambers Global as the world’s leading asset recovery legal network, our membership extends to every continent and the world’s major economies, as well as leading offshore wealth havens that have complex bank secrecy laws and institutions where the proceeds of fraud often are hidden. Founded in 2004 by the Paris-based International Chamber of Commerce (ICC), the world’s business organization, FraudNet operates under the auspices of the ICC’s London-based Commercial Crime Services unit. |
- Details
s.bonifassi@lebray.fr www.lebray.fr |
Address
7, rue de Madrid
75008, Paris, France |
Telephone
+33 1 44 90 17 10
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Languages
French, English, Russian, divish, Arabic, Romanian, Bulgarian
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Fraud and Asset Recovery in 2016 and Beyond As part of the Who’s Who Legal: Asset Recovery 2016 guidebook, I was invited to participate in a roundtable discussion and give my insights about trends and issues facing asset-recovery lawyers and our clients today.
A couple of topics that I have been vocal about recently emerged from the roundtable that I know have deeply affected my practice and that I know my colleagues, especially those in the FraudNet network to which I belong, contend with on a regular basis. Widening the Civil Route I feel strongly that in France, we need to widen the path to try fraud cases following a civil route. France is still too restrictive in allowing victims to use civil proceedings to recover their assets. I’ve seen this in other jurisdictions as well. |
There are too many hurdles facing victims. Of course, they can pursue the criminal route as French law allows them to be parties to criminal proceedings. But prosecutors often are too overwhelmed with cases and are not in a position to effectively deal with fraud cases, unless a major fraud case is at stake. To be certain, we are seeing some progress in the frame of civil proceedings, but it is still a difficult battle. The partners in my firm and I will continue raising the awareness of the French judiciary on this topic through articles and conferences. Improving Enforcement I also have been an outspoken advocate for a bill currently being discussed in France’s Parliament that will introduce a deferred prosecution agreement mechanism. Unfortunately, the government has introduced in this bill, Loi Sapin 2, a controversial provision to protect foreign states’ assets. Likely born out of the recent Yukos ruling against Russia and the French Ministry of Foreign Affairs’ desire to safeguard diplomatic relationships with foreign states, it is doubtful that this provision complies with either the UN Convention on the immunity of states that France has ratified or Article 6 of the European Human Rights Convention and the resulting case law, which says that creditors have a right to the enforcement of court decisions. For asset- and judgment-recovery lawyers, we have to keep a close watch on developments with this bill to ensure the victims we represent don’t fall victims to politics as well as fraud. Regarding case law developments, we are faced with contradicting tendencies in France. On one hand, French bank secrecy – even in the case of fraud, or simply to enforce judgment – is construed very strictly by courts in civil proceedings. Yet, applications to obtain disclosure orders before initiating proceedings are now obtained on a regular basis as long as banks are not the target of such disclosure orders. Blurred Jurisdictions While these issues admittedly affect French attorneys and their practices in France, in the world of fraud and asset recovery, jurisdictional borders often are blurred. History has shown us how the actions of lawmakers, law interpreters and law practitioners attract the attention of other worldwide jurisdictions trying to improve their laws, judicial interpretations and practices. When it comes to the disappearing borders of fraud and asset recovery, I’m grateful to have among my FraudNet colleagues, the caliber of knowledge that garnered the recognition of 22 of them by Who’s Who Legal as “most highly regarded individuals” and the many others listed and lauded throughout the guidebook. Stéphane Bonifassi, Executive Director of FraudNet, specializes in white-collar crime litigation and complex commercial litigation involving criminal or quasi-criminal conduct. In recent years, he has regularly represented individuals as well as corporations, victims of fraud. His practice is international and often involves mutual legal assistance issues. He has also developed a strong practice in the field of confiscation and forfeiture, freezing orders, attachments and similar measures mostly involving international parties and raising issues such as transnational enforcement of judgments and orders, lifting the corporate veil or state immunities. ICC Fraudnet is an international network of independent lawyers who are leading civil asset recovery specialists in each country. Recognized by Chambers Global as the world’s leading asset recovery legal network, our membership extends to every continent and the world’s major economies, as well as leading offshore wealth havens that have complex bank secrecy laws and institutions where the proceeds of fraud often are hidden. Founded in 2004 by the Paris-based International Chamber of Commerce (ICC), the world’s business organization, FraudNet operates under the auspices of the ICC’s London-based Commercial Crime Services unit. |
Contact
Contact
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