Month: June 2018

Australia’s Commonwealth Bank has agreed to pay a $530 million fine for breaching anti-money laundering and counterterrorism financing laws. The scandal relates to more than 53,000 suspect transactions that the bank did not immediately report to authorities.

If approved by the Federal Court, this will be the largest civil penalty in Australian corporate history.

At the heart of the case were so-called smart cash machines that allowed customers to anonymously deposit and transfer money. Thousands of suspect transactions of more than $7,600 each were not referred to the authorities as required by law.

An investigation by the Australian Transaction Reports and Analysis Center (AUSTRAC), the federal financial intelligence agency, along with state and federal police found the machines were being used to launder the proceeds of crime. 

Australian Treasurer Scott Morrison says the bank must now rebuild its reputation.

“It is for them to rebuild that trust, it is for them to make these admissions, it is for them to incur these penalties and get on with the job of restoring trust in the conduct of the CBA and this, I think, is another important step toward doing that,” Morrison said.

The Commonwealth Bank said its actions were not deliberate but it understood “the seriousness of the mistakes” it had made. It had reportedly been anticipating a fine of about $285 million.

“For AUSTRAC, it is able to demonstrate that there has been serious failings by Commonwealth Bank (CBA), one of our major financial institutions,” said Ian Ramsey, a director at Melbourne University’s Center for Corporate Law. “I am sure what the bank did not want was a very lengthy trial where every day more evidence is brought before the court and then promptly reported in the media of systemic, serious failings by CBA.”

AUSTRAC said the penalty would send a strong message to Australia’s financial industry. Since February it has been investigated by a Royal Commission, Australia’s highest form of inquiry, which has unearthed widespread misconduct within the banking and financial services sector.
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Pope Francis has told the world’s oil executives that a transition to less-polluting energy sources “is a challenge of epochal proportions.”

On the last day of a two-day conference Saturday, the Roman Catholic leader urged the executives to provide electricity to the one billion people who are without it, but said that process must be done in a way that avoids “creating environmental imbalances resulting in deterioration and pollution gravely harmful to our human family, both now and in the future.”

Reuters reports the unprecedented conference was held behind closed doors at the Pontifical Academy of Sciences.

The news agency says the oil executives, investors and Vatican experts who attended the summit, believe, like the pope does, that science supports the notion that climate change is caused by human activity and that global warming must be curbed.

Pope Francis told the conference, “Our desire to ensure energy for all must not lead to the undesired effect of a spiral of extreme climate changes due to a catastrophic rise in global temperatures, harsher environments and increased levels of poverty.”

 
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Drones guided by artificial intelligence to catch boats netting fish where they shouldn’t were among the winners of a marine protection award on Friday and could soon be deployed to fight illegal fishing, organizers said.

The award-winning project aims to help authorities hunt down illegal fishing boats using drones fitted with cameras that can monitor large swaths of water autonomously.

Illegal fishing and overfishing deplete fish stocks worldwide, causing billions of dollars in losses a year and threatening the livelihoods of rural coastal communities, according to the United Nations.

The National Geographic Society awarded the project, co-developed by Morocco-based company ATLAN Space, and two other innovations $150,000 each to implement their plans as it marked World Oceans Day on Friday.

The aircraft can cover a range of up to 700 km (435 miles) and use artificial intelligence (AI) technology to drive them in search of fishing vessels, said ATLAN Space’s founder, Badr Idrissi.

“Once (the drone) detects something, it goes there and identifies what it’s seeing,” Idrissi told the Thomson Reuters Foundation by phone.

Idrissi said the technology, which is to be piloted in the Seychelles later this year, was more effective than traditional sea patrols and allowed coast guards to save money and time.

From satellites tracking trawlers on the high seas to computer algorithms identifying illegal behaviors, new technologies are increasingly coming to the aid of coast guards worldwide.

AI allows the drones to check a boat’s identification number, establish whether it is fishing inside a protected area or without permit, verify whether it is known to authorities and count people on board, Idrissi said.

If something appears to be wrong, it can alert authorities.

Other winners were Marine Conservation Cambodia, which uses underwater concrete blocks to impede the use of bottom-dragged nets, and U.S.-based Pelagic Data Systems, which plans to combat illegal fishing in Thailand with tracking technologies.

“The innovations from the three winning teams have the potential to greatly increase sustainable fishing in coastal systems,” National Geographic Society’s chief scientist Jonathan Baillie said in a statement.

Much of the world’s fish stocks are overfished or fully exploited, according the U.N. food agency, and fish consumption rose above 20 kilograms per person in 2016 for the first time.

Global marine catches have declined by 1.2 million tons a year since 1996, according to The Sea Around Us, a research initiative involving the University of British Columbia and the University of Western Australia.
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A ‘smart’ bottle opener, weak and alcohol-free ales and lagers and cannabis brews – all visions of the future of beer offered at a brewing convention in Brussels this week.

More than 700 brewers and beer experts, from small microbrewers to megabrew executives, converged in Belgium, for many the home of beer, to debate hot topics in the $600 billion sector – including how to win drinkers back from wine and spirits.

Sessions on beer and food pairings sought to show how ales or lagers could challenge the dominance of wine during meals.

Anheuser-Busch InBev, the world’s largest brewer, has set increasing beer’s share of the overall drinks market as a top priority this year. Carlos Brito, its chief executive, told fellow brewers the sector should target mealtimes and women as areas of future growth.

Consumers should expect an even wider variety of products, particular of higher priced “premium” beers.

“Premiumization has arrived in, for example, confectionery. Look at chocolate. We have a long path ahead of us,” he said.

Cees’t Hart, the head of Carlsberg, called wine and tea “the enemy” and said brewers had identified a gap between beer and soft drinks – with low and no-alcohol brands that promised to be healthier than soda alternatives.

“That’s what we can own. This could be the future for the brewing industry,” he said.

Brewers AB InBev, Heineken, Carlsberg and China’s CR Snow sell about half of all beer drunk across the globe, but a growing number of smaller craft brewers, traditionally known for stronger ales, were also brewing low and no alcohol varieties.

Spiros Malandrakis, head of alcohol drinks research at Euromonitor International, said craft beers themselves appeared to have hit a plateau in the United States, with an estimated 6,000 breweries, but could expect to emerge in countries such as China and Vietnam.

Malandrakis also pointed to cannabis as a future growth segment, noting Constellation Brands’ $191 million investment in Canada’s Canopy Growth Corp, the first major drinks producer to invest in legal cannabis.

“The problem is that consumed in beer it would takes two to three hours to have an effect,” he said, adding a lot of effort was being put into studies to reduce this delay.

Downstairs at the convention, exhibitors displayed everything from tanks to taps and marketing to bottling technology that any budding microbrewer could want.

Among them was a device billed as the world’s first smart bottle opener, which connects to the Internet.

Although bottles must still be opened by hand, the device recognizes the bottle top and transmits that information by WiFi.

This allows brewers, large and small, to see how fast their beers are actually being consumed in bars, rather than just stocked, and also to offer promotions in real-time to push a particular brand.
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Argentina could revise the fiscal targets set as part of a $50 billion financing arrangement with the International Monetary Fund to increase spending on social programs, an IMF director said on Friday.

Argentina requested IMF assistance on May 8 after a run on its peso currency in an investor exodus from emerging markets.

The country’s stocks rallied on the deal to provide a safety net and avoid the frequent crises of the country’s past.

Many Argentines blame the austerity measures the IMF imposed under a previous bailout during its 2001-2002 economic crisis for plunging millions into poverty, but the organization said spending on programs to protect the poor could actually increase under the financing arrangement.

“The fiscal targets can be revised in case there is a need to increase social spending,” said IMF Western Hemisphere Director Alejandro Werner, adding that Argentina’s economy today is “very different than 2001.”

“That way, society does not have to choose between building a bridge or protecting the poorest.”

As part of the deal announced Thursday night, the government agreed to speed up reductions in the primary fiscal deficit to balance the budget by 2020. The government also pledged to propose legislation for a more independent central bank to fight double-digit inflation, which Werner praised on Friday.

Opposition politicians aligned with former populist President Cristina Fernandez have said market-friendly President Mauricio Macri was repeating earlier mistakes.

“Argentines do not want to go back to the past. It cost us a lot to get away from the Fund, and we do not want to go back there,” said Carlos Castagneto, a lawmaker aligned with Fernandez.

The benchmark Merval stock index rose 3.8 percent on the deal. Bonds rose modestly, with Argentina’s country risk — a J.P. Morgan measure of the difference between the country’s bond yields and less risky alternatives — down five points at 476 as of 3:56 p.m. local time (1746 GMT).

Argentina’s 100-year bond maturing in 2117 was up 0.2 percent at 87 cents on the dollar.

“The deal between Argentina and the IMF reduces immediate external financing risks and will help speed up fiscal consolidation,” said Gabriel Torres, a vice president at credit rating agency Moody’s.

Peso weakens

The deal still needs approval from the IMF board, which is expected to discuss it at a June 20 meeting. Treasury Minister Nicolas Dujovne said on Thursday he expected Argentina to receive a disbursement of 30 percent of the total, or roughly $15 billion, in the days following approval.

Finance Minister Luis Caputo said the government would not necessarily use the rest of the money and may return to bond markets to finance the estimated $22 billion in financing Argentina needs in 2019 to cover its fiscal deficit.

“If you need it you can use it, but if we regain access to the market at good rates, it is better to save it,” Caputo told investors on a conference call, according to a Finance Ministry statement.

The peso touched a record-low 25.66 per U.S. dollar after the central bank stopped a weeks-long defense of the currency. It later rebounded to close down 1.5 percent at 25.37 per dollar.

For the past few weeks, the central bank has offered to sell $5 billion in reserves at 25 pesos per dollar every day, effectively preventing the currency from falling below that level. That offer did not appear on Friday, traders said.

 
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The European Union will spend more than $40 million to help Venezuelans suffering through a deepening humanitarian crisis even as the country’s leaders have steadfastly denied it needs any foreign assistance.

Most of the money will provide health care, food and clean water to vulnerable Venezuelans living inside and outside of the country, European Commission officials said Thursday.

European leaders, meanwhile, have threatened a new round of sanctions against Venezuela’s top officials, after what it considers President Nicolas Maduro’s undemocratic re-election.

Commissioner Christos Stylianides said he recently visited Colombia’s border with Venezuela, and signs of the crisis he saw were obvious.

“Many people are lacking crucial medicines and are in need of humanitarian assistance,” Stylianides said. “We cannot remain bystanders to this human tragedy.”

Venezuela was once one of Latin America’s wealthiest countries, sitting atop the world’s largest oil reserves. Mismanagement and a drop in global oil prices have left it in a deepening economic and political crisis, marked by shortages of food and medicine and mass migration.

Maduro won a second, six-year term May 20, which his closest rival has challenged in Venezuela’s supreme court as deeply flawed with illegal tactics. Venezuela’s leading opposition parties boycotted the election as fraudulent.

The United States, European Union and several of Venezuela’s neighbors in Latin America have rejected Maduro’s election as illegitimate.

Humanitarian groups in the past have raised concern that Venezuelan officials would use international assistance as political tool instead of sending it to communities where it is needed.

A spokesman for the European Commission, however, told The Associated Press that they’re giving the money to crisis groups working in the region, like the United Nations and Red Cross so it doesn’t fall into the hands of Venezuelan officials.

Venezuelan leaders haven’t publicly commented on the European money being sent, but in the past they refused foreign assistance as a possible Trojan Horse that could open the politically turbulent nation to foreign military intervention.

Rather, Venezuela’s government prefers to send assistance to other nations, not willing to admit its deep needs at home.

It was among the biggest providers of aid to Haiti following the 2010 earthquake. More recently, Venezuelan state TV showed 12 tons of supplies being loaded onto cargo planes headed to Cuba for island residents hit by a tropical storm.

Since Maduro’s re-election, the European Union has called for a new presidential election in Venezuela, saying it will swiftly levy a new round of sanctions targeting those close to Maduro.

The European humanitarian assistance directed at Venezuela’s people won’t contradict its sanctions or those in place by the United States against 70 Venezuelan officials, including Maduro, experts say.

Eric Farnsworth, vice president at the Council of the Americas and Americas Society think tank, said Washington has already announced spending at least $16 million on Venezuela’s exiles, while pressing sanctions.

“The key is to help the people without lending support to the regime,” Farnsworth said. “It’s complicated, although not impossible in my mind, especially if the EU continues on the sanctions effort.”
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The Cambodian rosewood had stood for hundreds of years, but its value finally proved too hard to resist and the giant tree came crashing down — inside a protected forest.

It’s unclear exactly who was behind the felling — nobody has been charged — but it set off a series of events, which culminated in hundreds of villagers rejecting their community forest in favor of cutting more trees.

The incident underscores the challenge of protecting the country’s forests, which researchers say have been rapidly disappearing due to logging and agricultural land concessions granted to companies.

Cambodia has among the highest deforestation rates in the world, according to a study published in the journal Science Advances in 2017.

The Southeast Asian nation lost 1.6 million hectares between 2001 and 2014, including 38 percent of its “intact forest landscape”, which the study defined as “a seamless mosaic of forest and naturally treeless ecosystems.”

Conservationists have fought for years to convince the government and people in remote areas to check deforestation, and the community forest model has been a key strategy.

Local residents agree to preserve a community forest, although they are allowed to continue to farm areas already under cultivation, as well as harvest timber needed for construction — if they receive permission.

That model is broken, according to Ben Davis, who has worked in conservation in Cambodia since 1992 and set up the community forest near Ta Bos village in the province of Preah Vihear.

Davis has helped non-governmental organizations (NGOs) establish other community forests, which he said had ended up being logged as soon as no one was around to enforce protection.

“Unless there’s an NGO that is living there in the forest,” he said, trailing off. “The minute they’re gone…” Davis, an American, and his Australian wife, Sharyn, live with their two children in the community forest where they have set up an ecotourism lodge, and he often accompanies Ministry of Environment forest rangers on patrol.

A year ago, rangers startled some men who had just cut down the ancient rosewood, which Davis said was the biggest in the forest.

Authorities decided to confiscate the tree, but the rainy season delayed them and it lay in the jungle until this past April, said Davis and Pov Samuth, the local commune chief.

After the rangers hauled the rosewood to the village common area, residents protested, demanding that it be turned over to them, Davis and Pov Samuth said.

Davis said villagers recently sold one section of the tree — 1.7 meters long and more than a meter in diameter — for $10,000.

“It’s no wonder this thing set off a firestorm,” he said. “You can see why the villagers are hell bent on taking the forest over.”

About 400 residents demonstrated outside Davis’ house in April, and hundreds have applied their thumbprints to a petition demanding his eviction.

“We are not satisfied, because they said the area should be protected for the next generation, but villagers can’t go into the forest to do our work,” said Rorn Chhang, who added her thumbprint to the petition.

Her sister, Sorum Chhang, said she owned 20 hectares in the forest, which she began clearing in 2001.

“A few years ago, they came and said it belongs to the protected area, so they don’t allow me to do anything on my land,” said Sorum Chhang, who has no ownership documents.

Time to Talk

As the controversy continued, government officials in the capital, Phnom Penh, decided to meet with the villagers to explain the regulations around community forests.

About 300 people crowded into a wooden pagoda in the center of the village to speak to Lay Piden, deputy chief of law enforcement and governance at the Ministry of Agriculture.

“Nowadays, there are restrictions even to walk into the forest,” one man said to nods and murmurs of agreement.

After a heated discussion, Lay Piden said the villagers seemed most interested in figuring out how to keep felling trees, as they had before the community forest was established.

“Now, the officials from the Ministry of Environment prohibit them,” he told the Thomson Reuters Foundation. “That’s why they come here and get mad.”

Meas Nhem, director of the Phnom Tnout Wildlife Sanctuary, where the community forest lies, denied that residents are prevented from entering the protected area.

“We are not strict with the villagers,” he said by phone. “We allow them to take yields from the forest, but what we ban is deforesting for farming land and selling to dealers.”

Debt and Deforestation

Davis said almost the every family in the village has taken out loans, putting up their land as collateral, and they struggle to service the debt.

Pov Samuth, the commune chief, concurred.

“Nearly all villagers take money from the banks,” he said. “Some need to cut the trees to construct houses, and some also sell for paying the bank.”

Debt-driven deforestation in the Phnom Tnout Wildlife Sanctuary has raised fears among conservation groups.

In April, eight organizations, including the World Wildlife Fund, released a statement warning of “the rapid rate of destruction” and urged authorities to “enforce the rule of law.”

Already this month, three villagers have been arrested for cutting down a massive padauk tree, an endangered, luxury hardwood that is carved into furniture and musical instruments.

Davis said the rosewood incident had emboldened residents, as some had gained from the illegal felling.

“They hope to get away with it again,” he said.
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