Enforcement Actions

U.S. corporate due diligence firm Mintz Group said on Thursday its Beijing office was raided by authorities and five Chinese staff were detained, stoking worry among foreign companies in China just as its capital hosts an international economic forum. News of the raid and detentions comes as Sino-U.S. relations have spiraled downwards following months of diplomatic tensions, including over the U.S. military downing in February of a suspected Chinese spy balloon and a planned U.S. transit next week by the president of Taiwan, the self-governed island China claims as its territory. “We can confirm that Chinese authorities have detained the five staff in Mintz Group’s Beijing office, all of them Chinese nationals, and have closed our operations there,” the company said in an emailed statement to Reuters. The company said it was ready to work with Chinese authorities to “resolve any misunderstanding that may have led to these events”, and that its top concern was the safety and wellbeing of colleagues in China.

Credit Suisse Group AG and UBS Group AG are among the banks under scrutiny in a US Justice Department probe into whether financial professionals helped Russian oligarchs evade sanctions, according to people familiar with the matter. The Swiss banks were included in a recent wave of subpoenas sent out by the US government, the people said. The information requests were sent before the crisis that engulfed Credit Suisse and resulted in UBS’s proposed takeover of its rival. Subpoenas also went to employees of some major US banks, two people with knowledge of the inquiries, said. The Justice Department inquiries are focused on identifying which bank employees dealt with sanctioned clients and how those clients were vetted over the past several years.

Frankfurt (dpa) – A US court has ordered German stock operator Deutsche Börse’s Clearstream subsidiary to turn over about $1.7 billion in assets held by Iran’s central bank, Bank Markazi. The court decision comes as part of a long-running US legal case in which victims of a terrorist attack 40 years ago have sought compensation from Iran. Clearstream said it is considering an appeal of the decision. The assets are held in a customer account in Luxembourg by Clearstream, a wholly owned subsidiary of the German stock exchange operator. The company announced on Wednesday evening in Frankfurt that those suing Iran were granted a right to the assets attributed to the Iranian central bank held in a customer account at Clearstream. Iranian-held assets at Clearstream, which manages securities on behalf of customers and handles purchases and sales, have been frozen on suspicion of terrorist financing and locked in several legal disputes for a number of years. According to Deutsche Börse, that case remains pending but Clearstream maintains it is without merit.

A federal court in the District of Columbia unsealed two indictments yesterday charging multiple defendants with violations of the Arms Export Control Act (AECA) and the International Emergency Economic Powers Act (IEEPA) for their roles in separate schemes to procure and export U.S. technology to Iran between 2005 and 2013. In connection with this announcement, the Department of Treasury’s Office of Foreign Assets Control designated three of the defendants and four entities for their involvement in the procurement of equipment that supports Iran’s ballistic missile and unmanned aerial vehicle (UAV) and weapons programs.

The United States said Tuesday it is imposing a new round of sanctions on Iranian firms and people accused of procuring equipment used for Iranian drones. Treasury’s Office of Foreign Assets Control coordinated with the FBI to designate four firms and three people in Iran and Turkey for allegedly buying equipment, including European-made engines, to be used for Iran’s drone and weapons programs. Those targeted for sanctions include the Iran-based Defense Technology and Science Research Center, its procurement firm Farazan Industrial Engineering Inc. and two other firms along with purchasing agents from the companies.

Today, the Department of Justice, on behalf of the Environmental Protection Agency (EPA), filed a motion for preliminary injunction under the Clean Air Act (CAA) requesting that the court order Denka Performance Elastomer LLC (Denka) to require significant pollution controls to reduce chloroprene emissions, a pollutant that EPA has determined to be a likely carcinogen. The request for immediate relief by EPA and the Justice Department follows the United States’ complaint filed on Feb. 28, alleging an imminent and substantial endangerment to the communities surrounding the facility as a result of Denka’s manufacturing operations. The Clean Air Act section 303 imminent and substantial endangerment lawsuit is currently pending in the U.S. District Court for the Eastern District of Louisiana.

German and US authorities, supported by Europol, have targeted ChipMixer, a cryptocurrency mixer used to keep crypto transactions private. The investigation was also supported by Belgium, Poland and Switzerland. On 15 March, national authorities took down the infrastructure of the platform, seizing 4 servers, and also seizing about 1909 Bitcoins in 55 transactions (approx. EUR 44.2 million) and 7 TB of data.

Guo Wengui, a Chinese billionaire known for his opposition to Beijing and ties to the administration of former US President Donald Trump, has been charged in the United States with defrauding investors out of $1bn. Guo, also known as Ho Wan Kwok and Miles Guo, was arrested in New York on Wednesday over an alleged conspiracy involving the misappropriation of hundreds of millions of dollars obtained from his thousands of followers online, the US Department of Justice said in a statement. Guo is accused of pocketing money raised from investors who were promised outsized returns for backing a number of his business ventures, including the media company GTV Media Group, an exclusive membership club known as G|CLUBS and a cryptocurrency called Himalaya Coin.

The Japan Securities Dealers Association said Wednesday it has imposed a penalty of 300 million yen on SMBC Nikko Securities Inc for market manipulation, matching the highest fine previously issued by the organization. According to the JSDA, SMBC Nikko illegally propped up the prices of 10 individual stock issues to stabilize them last year in “block offering” transactions. The fine imposed on the brokerage by the JSDA is equal to that issued to Nomura Securities Inc. in connection with an insider trading scandal in 2012.

A Southfield, Michigan-headquartered bank holding company has agreed to plead guilty to securities fraud for filing false securities statements relating to its 2017 initial public offering (IPO) and its 2018 and 2019 annual filings. According to a signed plea agreement that will be publicly filed in court, Sterling Bancorp, Inc. (the Company) was the holding company for its wholly owned subsidiary, Sterling Bank and Trust F.S.B. (the Bank, or together with the Company, “Sterling”). Sterling – with branches located in San Francisco, Los Angeles, Seattle, New York, and Southfield – completed an IPO in 2017, and the Company’s stock began trading on the NASDAQ exchange under the ticker symbol “SBT.”

The United States Environmental Protection Agency has proposed the first federal limit on so-called “forever chemicals” in the country’s drinking water, a move officials said will save lives. The proposal announced will limit per- and polyfluoroalkyl substances, also known as PFAS. The substances have been linked to a range of health issues, including low birth weight and kidney cancer. They do not naturally degrade in the environment and are expensive to remove from water.

ilicon Valley Bank’s parent company and two senior executives are facing a class-action lawsuit in the United States, where shareholders have accused the financial institution of failing to disclose the risks that anticipated interest rate hikes would have on its business. The lawsuit, filed in federal court in the Northern District of California on Monday, is seeking unspecified damages from SVB Financial Group and its Chief Financial Officer Daniel Beck, as well as the bank’s Chief Executive Officer Greg Becker. The bank collapsed and its assets were seized by the US government late last week after a mass withdrawal of funds by customers.

According to Andrew Adams, the group has focused on identifying those who are helping Russians to avoid sanctions and export controls. “I think it can be quite effective to be sanctioning facilitators,” Adams said, calling them “professional sanctions evasion brokers.” A recent report from the Treasury Department showed that more than $58 billion worth of sanctioned Russian assets have been blocked or frozen worldwide so far. Adams pointed out that KleptoCapture aims to sell the frozen yachts and other property of sanctioned Russians, despite the legal difficulties, and use the proceeds for the benefit of Ukraine. He noted, however, that this would be done in accordance with the law.

The ban will be imposed next week and reevaluated after six months, De Croo said in a statement. Government employees will be allowed to use the app on their personal devices, but not on any devices “whose purchase, subscription or use are partly or fully paid for by the federal government.” Citing reports by the Belgian State Security Service and Centre for Cybersecurity, De Croo claimed that TikTok collects large amounts of user data, manipulates the information users are exposed to, and cooperates with Chinese spy agencies. “We must not be naive,” De Croo said. “TikTok is a Chinese company that today is obliged to cooperate with the Chinese intelligence services.”