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BlogThis Week in Compliance

Former Petroecuador execs charged in bribery scheme

By Brad Fulton

Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week, former executives of Ecuadorian energy giant Petroecuador are being charged in bribery scheme. Read the full story and more news below:

Top Story

Former Petroecuador execs charged in bribery scheme

Seven former employees, including four former executives, of Ecuadorian oil giant Petroecuador, have been arrested and charged for their involvement in a multi-million dollar bribery and money-laundering scheme. The men involved in the scheme, including one who was a former high-ranking employee of the Ministry of Economy and Finance, are accused of providing kickbacks to Ecuadorian government officials in return for contracts with the company as an energy provider. The pay-for-contract scheme allegedly ran from 2010 to 2021, with one single company paying Ecuadorian officials more than $70M USD.

Government

Escalating violence leads to strict sanctions against Myanmar

Owed to ongoing, increased violence in Myanmar brought forth by its sitting military regime, the US and EU have imposed stricter sanctions on the country. In February of last year, Myanmar's democratically-elected government was overthrown by a coup from a military regime in the country. The sanctions will hit individuals and high-ranking officials connected with the military group that the US said had, “a central role in undermining democracy and the rule of law in Myanmar/Burma”. EU officials have accused the military regime of human rights violations, war crimes, and crimes against humanity and has condemned the violence brought to the country.

Nearly 400 arrested in Balkans drug and firearms trafficking sting operation

Sting operations across countries in the Balkans and Southeast Europe led to the arrest of nearly 400 people involved in illegal drug and human trafficking rings. The operation, coordinated by authorities in Spain and 28 other European countries, was carried out over the course of two days and targeted popular trafficking routes long used by multiple crime organizations. According to Europol, the Balkan route is one of the main ways in which drugs and illegal weapons enter European countries. Police conducted searches and inspections of nearly 75,000 vehicles along the trade route and seized hundreds of weapons and large amounts of illegal narcotics.

Business

Crypto platform founder charged in alleged Ponzi scheme

The founder and three high-level promoters of cryptocurrency trading platform Trade Coin Club have been arrested this week under accusations that they were running a Ponzi scheme through the platform. The four men arrested allegedly lied to investors about the potential performance of a cryptocurrency "trading bot" that promised strong returns that it could not fulfill. When the bot could not meet returns expectations, early investors and regular withdrawals of currency were then paid their returns using money invested by later investors. The SEC said that the individuals could be charged with several counts of violating antifraud laws, securities registration lapses, and broker-dealer registration provisions.

DOJ announces conviction in Silk Road case after historic crypto seizure of more than 3B USD

The Department of Justice announced this week that James Zhong, who was accused last year of stealing more than 50,000 Bitcoin, worth approximately $3.36B USD at time of seizure, has pled guilty to wire fraud. The conviction and case marks the largest ever cryptocurrency seizure by the US government. The Silk Road was an online black market marketplace where users conducted transactions of drugs, weapons, and other illegal goods, using Bitcoin and other cryptocurrency. Zhong was arrested last year and accused of running a scheme which resulted in the theft of 50,000 Bitcoin. Zhong is scheduled to be sentenced in February 2023. Wire fraud has a maximum penalty of up to 20 years in prison.