July 30, 2021
European Union proposes new anti-money laundering authority with strong focus on reducing anonymity. Last week the European Commission proposed a new legislative package to curb the threat of money laundering and terrorist finance throughout the European Union (EU). The United Nations Office on Drugs and Crime estimates that between 2 and 5% of global GDP – between $800 billion to $2 trillion, is laundered annually. To ameliorate this risk, the EU now wants to establish a 250-member Anti Money Laundering (AML)-Combatting the Financing of Terrorism (CFT) authority to increase coordination among regional financial intelligence units and better identify seemingly unconnected illicit actors. The authority will be responsible for both formulating clear AML-CFT regulations as well as enforcing violations with financial penalties. The new EU proposal comes after the U.S. adopted a tougher AML law at the start of 2021 and will likewise require financial institutions to pay greater attention to transparency- both of its customers base and their transactions. Over the past several years, customers have increasingly maintained anonymity via unchecked beneficial ownership filings and cryptocurrency transactions. The EU proposal requires more stringent due diligence and Know Your Customer (KYC) requirements of its member states and prohibits financial institutions to transact with anonymous cryptocurrency wallets. There will also be an EU-wide limit of €10,000 on cash payments.
With new leadership in Israel and Iran, Russia is playing a deliberately ambiguous game in Syria. According to a top Russian military official, Israeli missiles launched against Iranian-backed targets in Syria have recently been downed on several occasions by Syrians using Russian-supplied air defense systems. These developments have not been corroborated by U.S. or Israeli officials, but the allegations are nonetheless telling. Putin and Netanyahu had an agreement that the Israelis could conduct strikes in Syria against Iranian-backed targets provided they first deconflicted. But with Netanyahu no longer in power, and a leadership change in Iran, a shift in Russian policy is possible or at least more believable. Several weeks ago, U.S. media reports also indicated that Russia was vying to sell an advanced spy satellite to the Iranians, which Putin vehemently denied. Earlier this week, two Iranian ships that have been under watch since late May due to suspected travel to Venezuela, instead wound-up participating in the Russian Navy’s 325th anniversary celebration. Whether the Russians are looking to limit Israeli actions in Syria, or if they are simply hedging bets with Iran, reporting on intercepted Israeli missiles also serves as a convenient advertisement for Russian-made military equipment.
Chinese operations in Pakistan could be increasingly targeted as the U.S. withdraws from Afghanistan. This week in Karachi two masked assailants reportedly shot at a car transporting two Chinese nationals employed at a nearby factory. Earlier this month, nine Chinese and four Pakistani workers were killed in a bus bomb attack while traveling to the $4.2 billion Dasu hydropower dam, part of the broader U.S. $65 billion China-Pakistan Economic Corridor (CPEC) project. The Pakistanis initially denied that the bus was targeted by terrorists, but eventually conceded and an investigation is underway. In April, several people were killed in a hotel attack in Quetta that is believed to have targeted the Chinese ambassador; this attack was claimed by Pakistani Taliban. Beijing and Islamabad are close allies collaborating on regional infrastructure projects opposed by both separatist insurgents and Islamist terrorist organizations. Grievances range from lack of economic opportunity for the local population to the Chinese treatment of its Muslim, Uighur population. Baloch separatists at war with the Pakistani state have also attempted to undermine the Chinese – targeting the Chinese consulate in Karachi and hotels housing Chinese workers. Further, with the U.S. withdrawal from Afghanistan China is the new face of the large, external power acting in the region. The Chinese recently met with the Taliban and expressed interest in maintaining regional peace, but with increasing economic inequity in the region, further exasperated by Covid-19 and political unrest, the Chinese are likely to remain a ready local target.
