study of typologies of financing of proliferation final 5...

Study of Typologies of Financing ofWMDProliferation InterimReport5February2017

JonathanBrewerVisitingProfessorKing’sCollegeLondon

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ProjectAlphaCentreforScienceandSecurityStudiesKing’sCollegeLondonStrandLondonWC2R2LSUnitedKingdomTelephone:+442078481342Version1,January2017©King’sCollegeLondon2017

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ExecutiveSummaryCombating the proliferation of weapons of mass destruction is a key priority for theinternationalcommunity.Oneofthetoolsfordoingthisisdisruptionofthenetworksusedto financeproliferation.However,detecting financingofproliferation (FoP) isdifficultandrequiresabetterunderstandingofthetypologies.

ThemostcomprehensivestudyofFoP todatewaspublishedby theFinancialActionTaskForce (FATF) in 2008.1 Since then, largely due to sanctions on Iran and DPRK, moreinformation on FoP has become available. The King’s College Study of Typologies ofFinancingofProliferation iscollectingandanalyzing informationheldbygovernmentsandthebankingandfinancialsectorinordertopublishreportsoncurrentFoPtypologies.

ThisInterimReportcomprisesanalysesof18casestudies,basedoninformationsuppliedtotheStudytodate,containedinreportsofUNPanelsonIranandDPRK,andindocumentsrelatingtoasmallselectionofUSDepartmentofJusticeactions.Althoughinsomeofthese18 cases there is insufficient information available to determine whether the underlyingtypologyrelatestoFoPorsimplytocircumventionoffinancialsanctions,keypointscanbeidentified.

Someof thesepoints canbe correlatedwith indicators of possible proliferation financinglisted inFATF’s2008 report.But thekeypointsalsosuggesta smallnumberofadditionalpossibleindicators. It isnotsuggestedthatanyoneofthesewouldbedefinitive,andtheywillbefurtherexaminedduringtheremainderofthisStudy. They includeinvolvementofsmall brokers/intermediaries, involvement of dual nationals of countries of proliferationconcern, involvementof auniversity ina countryofproliferation concern,descriptionsofgoodsbeingnon-specific,banksnamedasconsignees,andpaymentsfor largenumbersofhigh-technologygoodsthatarenever imported.Theseadditional indicatorscouldpossiblybe visible to banks and financial institutions that might be unknowingly involved inprocessingrelatedtransactions.

The King’s College London Study will continue to collect and analyse data on FoP fromgovernmentsandtheprivatesector,andwillpublishafinalreportinSummer2017.Inthemeantimecommentsonthecontentsof this InterimReportand itspracticalvaluewillbewelcome, as will proposals to engage substantively with the Study. Contact details arecontainedinAnnex2.

1TypologiesReportonProliferationFinancing,2008(http://www.fatf-gafi.org/publications/methodsandtrends/documents/typologiesreportonproliferationfinancing.html)accessed15January2017).

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Acknowledgments

ManygovernmentshaverespondedpositivelytoapproachesbytheStudy,andseveralhaveprovidedorpromiseddata.TheSwedishgovernmentwasparticularlysupportive.TheStudyis grateful, as it is to several banks that havehosted informativediscussionsor promiseddata.

MailaBeniera, internwith theAlphaProject, King’sCollege,providedvaluable support totheStudybyanalyzingpublisheddataonFoP.AndreaBerger,formerlyoftheRoyalUnitedServices Institute,nowCenter forNon-ProliferationStudies,Monterey,providedhelpandadvice.

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TableofContents

Abstract.............................................................................................................................3

Introduction......................................................................................................................7

King’sCollegeLondonStudyofTypologiesofFinancingofProliferation(STFoP)................7

InterimReport......................................................................Error!Bookmarknotdefined.8

DefinitionofFoP................................................................................................................8

ComparingFoPwithMoneyLaunderingandTerroristFinancing........................................8

DetectionofFoP..............................................................................................................10

FATFFoPTypologies........................................................................................................10

TradeFinancing...............................................................................................................11

CaseStudies....................................................................................................................11

Case 1 (DPRK) Procurement network adapts so as to enable business to continue followingdesignationsbyUSauthorities..................................................................................................12

Case2(DPRK)Financingofproliferationbyavoidinginternationalfinancialtransactions.........14

Case3(DPRK)Ashippingagentfinancesaproliferationshipment............................................16

Case4(Iran)FinancingofProliferationin1999:Sometechniqueshavechangedlittle..............18

Case5(Iran)Financingofprocurementofdual-usevalves.......................................................21

Case 6 (Iran) Circumvention of financial sanctions: A trading company turns into a moneyremittancebusiness..................................................................................................................23

Case7(Iran)Asmallbroker/intermediaryplaysakeyroleinaprocurementnetwork(1).........25

Case8(Iran)Aprobablesanctionscircumventionschemedetectedbymonitoringforsuspicioustransactions(1).........................................................................................................................27

Case9(Iran)Aprobablesanctionscircumventionschemedetectedbymonitoringforsuspicioustransactions(2).........................................................................................................................29

Case 10 (Iran) A probable sanctions circumvention scheme detected by monitoring forsuspicioustransactions(3)........................................................................................................31

Case11(Iran)AttempttocircumventsanctionsbyuseofafakeaddresstohideinvolvementofanIranianentity.......................................................................................................................33

Case12(Iran)AttemptatsanctionscircumventionasthebeneficiaryofaLetterofCreditactsasafrontcompanyforanIraniancompany..................................................................................34

Case13(Iran)SanctionscircumventionrevealedbyexaminationofdocumentsforashipmenttoaStateneighbouringIran..........................................................................................................35

Case14(Iran)SanctionscircumventionbyacompanyactingasremittanceagentonbehalfofacompanyinIran........................................................................................................................36

Case 15 (Iran) Sanctions circumvention by an Iranian businessman located overseas whoreceivedincomefromhisbusinessinIran.................................................................................37

Case16(Iran)SanctionscircumventionasapaymenttocompanyinsideIranismadethroughathirdcompanyoutsideIran.......................................................................................................38

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Case17(Syria)Asmallbroker/intermediaryplaysakeyroleinaprocurementnetwork(2).....39

Case18(Pakistan)PracticesofanallegedprocurementnetworkoperatingfromPakistan........41

FATFindicatorsofpossibleproliferationfinancing:Asecondlook...................................43

STFoPadditionalindicatorsofpossiblefinancingofproliferation....................................44

ConclusionsandSTFoPfuturework.................................................................................46

Annex1:FATF2008Report:ProliferationFinancingSuspiciousIndicators.......................47

Annex2:Methodology....................................................................................................48

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IntroductionCombatingtheproliferationofweaponsofmassdestruction(WMD)isakeypriorityfortheinternational community. United Nations Security Council (UNSC) resolution 1540 (2004)andsuccessorresolutionsrequireUNMemberStatestoputinplacemechanismstocontrolproliferation.UNSCsanctionsare inplaceagainstDPRK’sWMDprogrammes.Proliferationby Iran is constrained by a UNSC resolution and the Joint Comprehensive Plan of Action(JCPOA).Syrianproliferationislimitedbyunilateralsanctions.OtherWMDprogrammesarecloselymonitored.

One of the favoured tools for countering proliferation is identification and disruption ofprocurementnetworks.Suchnetworksseektopurchase,usuallybycovertmethods,goodsandmaterialsthattheproliferationprogrammescannotproduceindigenously.Thesegoodsand materials are usually industrial in nature and their procurement is often difficult todistinguishfromlegitimateglobalcommerce.

Aswithlegitimateglobalcommerce,suchgoodsandmaterialsneedtobefinancedandpaidfor,soidentificationanddisruptionoftheassociatedfinancialnetworksoffersanadditionalcounter-proliferation tool. However, detecting the financing of proliferation (FoP) in theabsenceofothercluesisdifficultandrequiresabetterunderstandingofFoPtypologies.

ThemostcomprehensivestudyofFoP todatewaspublishedby theFinancialActionTaskForce (FATF) in 2008.2 It is based largely on material relating to FATF Member States’implementationoffinancialprovisionsofresolution1540(2004)onnon-proliferation.FATFidentified20indicatorsofpossibleproliferationfinancing.

AdditionalmaterialonFoPhasbecomeavailablefollowingimplementationofUNsanctionsonIran(2006to2016),andonNorthKorea(2006todate).ThismaterialisdescribedinreportsofUNSanctionsPanelsonIranandonDPRK.3

King’sCollegeLondonStudyofTypologiesofFinancingofProliferation(STFoP)The objectives of the Study are to gain insights into current typologies of proliferationfinancing, based on data available following 2008. Reports published by the Study areintended to assist government practitioners to identify and investigate FoP, to disruptproliferation networks, and to provide guidance to financial institutions regarding thefinancingofproliferation.Thereportsarealsointendedtoassistbanks,financialinstitutionsandotherrelevantentitiestoremaincompliantwithsanctions,identifytransactionsrelatingto FoP, and inform relevant authorities (for example by submitting Suspicious ActivityReports).

This InterimReport summarises the resultsof theStudy todate. Itdescribes case studies(see Case Studies below), together with preliminary conclusions regarding indicators ofpossiblefinancingofproliferationsupplementarytothoseidentifiedbyFATF.Itisbasedon

2TypologiesReportonProliferationFinancing,2008(http://www.fatf-gafi.org/publications/methodsandtrends/documents/typologiesreportonproliferationfinancing.html,accessed15January2017).3 Iran: UN Panel on Iran Reports dated 2012, 2013, 2014 and 2015 (available on the UN website as Security Council documentsS/2012/395,S/2013/331,S/2014/394andS/2015/401);DPRK:UNPanelonDPRKReportdated2010,2012,2013,2014,2015and2016(availableontheUNwebsiteasS/201/571,S/2012/422,S/2013/337,S/2014/147.S/2015/131andS/2016/157).

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exchanges with governments and banks, and on a selected compilation of publicallyavailablematerialrelatingtofinancingofproliferation.Theunderlyingdataaredrawnfroma number of different proliferation programmes, and result from implementation at thetimeofavarietyofsanctionsorothercontrolregimes.

DefinitionofFoPThere is no universally recognised definition of FoP, and so the Study has adopted thewidelyusedformulationproposedbyFATF:

"Proliferation financing" refers to: theactofproviding fundsor financial serviceswhichareused, inwholeor inpart,forthemanufacture,acquisition,possession,development,export, trans-shipment, brokering, transport, transfer, stockpiling or use of nuclear,chemical or biological weapons and their means of delivery and related materials(including both technologies and dual use goods used for non-legitimate purposes), incontraventionofnationallawsor,whereapplicable,internationalobligations.4

Akeyelementofthisdefinitionis“meansofdeliveryandrelatedmaterials(includingbothtechnologies and dual use goods used for non-legitimate purposes)”. In practice, mostcounter-proliferationactions todayaredirectedat the relatedgoodsandmaterials ratherthanfinishedweaponssystems.

ComparingFoPwithMoneyLaunderingandTerroristFinancing As highlighted in a recent report5, many financial institutions have a relatively low-levelunderstanding of FoP, as domany States.6 This problem is compounded by uncertaintiesabout the differences and similarities between FoP and Money Laundering (ML) andTerrorist Financing (TF). It is hoped that the general observations in Table 1 will helpunderstandingofFoP.

Table1.ComparisonofML,TFandFoPCharacteristics7

MoneyLaundering TerroristFinancing FinancingofProliferation

Source Internallyfromwithincriminalorganisations

Internallyfromself-fundingcells(centeredoncriminalactivity)Externallyfrombenefactorsand

State-sponsoredprogrammes

4CombatingProliferationFinancing–AStatusReportonPolicyDevelopmentandConsultation,February2010.5“OutofSight,OutofMind”,EmilDall,AndreaBergerandTomKeatinge,RUSIWhitehallReport,June2016.6Author’sconclusionsbasedonhisexperienceofdiscussionswithofficialsasamemberoftheUNPanelonIran.OfficialguidanceonFoPmayalsoconfusethepicture.Forexample,Section3.7.5ofFCA’sThematicReview“Banks’controloffinancialcrimerisksintradefinance”ofJuly2013includes,underadiscussionofcounterterroristfinancing(CTF)controls,materialpossiblymoreappropriatetofinancingofproliferationofdual-usegoods.7Modified fromapresentationby JamesRRichards,WellsFargo,2005,quoted in theCAMSExaminationStudyGuide5thEdition).Theauthorhasaddedtothispresentationtheright-handcolumn,headedFinancingofProliferation.

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fundraisers

Conduits Favoursformalfinancialsystem

Favourscashcouriersorinformalfinancialsystemssuchashawalaandcurrencyexchangefirms

Favoursformalfinancialsystem

DetectionFocus Suspicioustransactionssuchasdepositsuncharacteristicofcustomer’swealthortheexpectedactivity

Suspiciousrelationships,suchaswiretransfersbetweenseeminglyunrelatedparties

Individuals,entities,States,goodsandmaterials,activities

TransactionAmounts

Largeamounts,oftenstructuredtoavoidreportingrequirements

Smallamounts,usuallybelowreportingthresholds

Moderateamounts,possiblyabovereportingthresholds

FinancialActivity Complexweboftransactionsofteninvolvingshellorfrontcompanies,bearershares,offshoresecrecyhavens

Variedmethodsincludingformalbankingsystems,informalvalue-transfersystems,smugglingofcashandvaluables

Transactionslooklikenormalcommercialactivity,structuredtohidesourceoffunds

MoneyTrail Circular–moneyeventuallyendsupwiththepersonwhogeneratedit

Linear–moneygeneratedisusedtopropagateterroristgroupsandactivities

Linear–moneyisusedtopurchasegoodsandmaterialsfrombrokersormanufacturers

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DetectionofFoPThere are, in principle, four ways that governments, banks or other financial institutionscoulddeterminewhetheragivenfinancialtransactioninvolvesFoP:

1.Screeningandmonitoringfinancialtransactionsfor involvementof individualsorentities which are designated for their involvement in proliferation, under UN orunilateral sanctions regimes. Such procedures are not fool-proof because muchproliferation involves individuals or entities which have not been designated andthat are therefore not detectable by many commercially available screening ormonitoringsystems;

2. Screening documentary information on goods and materials involved intransactions to identity items that may be listed on the control lists of nationalauthoritiesoroftheexportcontrolregimes;8Thisisdifficultforbanksbecausetheyusually do not have sufficient expertise to determinewhether goodsmight be solisted,andmaynothave in theirpossessiondocumentsor transaction informationwithsufficientdetail;

3.PossessionofintelligenceorotherinformationthatFoPistakingplace;

4. Identification of patterns or characteristics that match typologies known to beassociatedwithfinancingofproliferation.ThisistheprocesstheStudyisintendedtosupport. Fewbanks inpractice try todo this (andnotmany regulators require it).However,manybankscarryouttransactionmonitoringtodetectMLandTFand,assomeofthecasestudiesbelowillustrate,somepatternsofFoPorcircumventionoffinancialsanctionsresemblesuspiciousindicatorsforML.

FATFFoPTypologiesFATF’s2008Reportidentifies20indicatorsofpossibleproliferationfinancing(seeAnnex1).Thisremainstheauthoritativelistalthoughindividualjurisdictionshavealsopublishedlistsofpossibleproliferation-relatedSuspiciousIndicators9.

Aspointedoutinarecentreportandbyothers,arguablyfewofFATF’sindicatorscouldbeconsideredstrongFoPindicators.1011Theymightresultfromotherfinancialcrimes,suchastrade-based money laundering or avoidance of tax or duty. They could also indicatesanctionscircumventionorinsomecasessloppydocumentationpractices.

8ForexampletheNuclearSuppliersGroupandtheMissileTechnologyControlRegime.9SeeforexamplelistspublishedbytheJerseyFinancialServicesCommission(https://www.jerseyfsc.org/pdf/Proliferation_and_Proliferation_Financing_Guidance_Oct_2011.pdf(accessed26December2016))andbytheMonetaryAuthorityofSingapore(http://www.mas.gov.sg/~/media/MAS/Regulations%20and%20Financial%20Stability/Potential%20Indicators%20of%20Proliferation%20Financing.pdf(accessed26December2016)).10“OutofSight,OutofMind”,opcit,11Multiplecommentsfrombankofficialstoauthor.

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TradeFinancingMany of the case studies in FATF’s 2008 Report include references to documentationassociatedwithtradefinance,suchasLettersofCredit.AccordingtotheWolfsbergGroup,the majority of world trade (approximately 80%) is carried out under “Open Account”terms.12 In comparisonwith informationprovided to support trade finance,openaccounttransactions (essentially wire transfers) allow financial institutions relatively limitedinformation for screening or monitoring against lists of suspicious indicators. But evenwhere trade financing takes place many financial institutions conduct checks focusedprimarilyoncreditriskratherthanproliferationfinancing,sanctionscircumventionorotherfinancialcrime.13

The potential for trade financing documentation to assist in detection of FoP will beexaminedfurtherbytheStudy.

CaseStudies In order to assist practitioners in governments and the private sector to understand FoPtypologies,andbetterfocustheirinvestigations,18casestudiesaredescribedbelow.

Thesehavebeencompiledfrominformation:

a)providedbyGovernmentstotheStudyandauthorizedforpublication;

b)containedinreportsfromUNPanelsonIranandonDPRK(thismaterialrelatestobothFoPandtocircumventionoffinancialsanctions);14

c) contained in court recordsofUSDepartmentof Justice (DoJ) actions relating tofinancing of proliferation or circumvention of sanctions.15 A small selection of thismaterial is includedprimarilytoaddgeographicaldiversitytotherangeofcases.AmorecompleteselectionwillbeincludedintheStudy’sfinalreporttobepublishedinSummer2017.

It shouldbenotedthatsomeof these18casesasdescribedcouldat the timehavebeenprimarilyattemptstocircumventfinancialsanctions.TheyareincludedbecauseitisjudgedthatthetypologycouldalsobeusedforFoP.

12TheWolfsbergTradeFinancePrinciples(2011)(http://www.wolfsberg-principles.com/pdf/standards/Wolfsberg_Trade_Principles_Paper_II_(2011).pdf(accessed21January2017)).13DubaiFinancialServicesAuthorityTradeFinanceReport2016(http://dfsa.ae/Documents/ThematicReviews/TF-Report-FINAL%20Eng%2012%20october%202016%20mid-res.pdf(accessed21January2017)).14Seelistinfootnote4.15 Accessed through a subscription-based repository of US courts documents: Public Access to Court Electronic Records(https://www.pacer.gov/).OFACcaseslistedatwww.treasury.gov/resource-center/sanctions/Pages/default.aspx.

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Case 1 (DPRK) Procurement network adapts so as to enable business to continue following designations by US authorities

AccordingtoUScourtdocumentsrelatingtothearrestoffatherandsonin2013andtheirconvictionin2015,anetworkofindividualsincludingAlexTsai,basedinTaiwanandhissonGaryTsai,basedintheUS,wasunderinvestigationfrom2009forexportofUS-origingoodsand machinery that could be used to produce weapons of mass destruction.16 Thesedocumentsprovideinsightsintotheproliferationnetwork’sfinancialarrangements.

According to these documents the network consisted of at least three Taiwan-basedcompaniessetupandmanagedbyAlexTsai:Global InterfaceCompany, Inc.,asubsidiary,TransMeritsCo. Ltd., andTransMultiMechanics Ltd. Tsai’swifewas anofficer inGlobalInterface Company, Inc., and Trans Merits Co. Ltd.. Tsai and Trans Merits Co. Ltd wereconvictedbyTaiwaneseauthoritiesin2008inconnectionwithshippingrestrictedmaterialstoNorthKorea.InJanuary2009theUSTreasurydesignatedTsai,hiswife,TransMeritsCo.Ltd and Global Interface Company, Inc. for support to the Korea Mining DevelopmentTradingCorporation(KOMID),anentitycloselylinkedwithDPRK’sWMDprograms.Ineffect,USpersons couldonlydobusinesswithTsai andhisdesignated companieswithanOFAClicense.

According to a separate report, a fewmonths laterUS authorities possessed informationthat Alex Tsaiwas duemeet a KOMID representative in Singapore to receive a payment,possiblyforshipmentofequipmentworthoverUSD850,000,possiblyincash.17

DespitehisdesignationinJanuary2009,accordingtocourtdocuments laterthatyearTsaiimported from the US a precision machine tool through his third, non-designated,Taiwanesecompany,TransMultiMechanicsLtd,with theassistanceofhis son,GaryTsai.TransMultiMechanicswas representedonexportdocumentsaspurchaserandend-user.Althoughpaymentwas initiatedby TransMerits Co Ltd, the involvement of a designatedentity in the transaction was hidden because the wire transfer, to Gary Tsai’s US bankaccount, took place from TransMultiMechanics Ltd’s bank account in Taiwan. Similarly,subsequentfinancialtransfersfromAlexTsaitohissontooktheformoftwowiretransfersfrom a bank account in Taiwan controlled by his daughter, in effect hiding from the USbankingsystemtheinvolvementofadesignatedindividual(Figure1).GaryalsosetupaUS-based company, FactoryDirectMachine Tools, to help develop businesswith his father’scompanies.

16Forexample,indictmentfiled26June2013,USDistrictCourtNorthernDistrictofIllinoisEasternDivision,Case12CR829,UnitedStatesofAmericav.HsienTaiTsaiandYueh-HsunTsai,andAffidavitofFBISpecialAgentinSupportofExtradition.17 US Department of State cable dated 14 April 2009, quoted byWikileaks (https://wikileaks.org/plusd/cables/09STATE36855_a.html,accessed22January2016)

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Figure1.DPRKprocurementnetworkinvolvesfather’sandson’scompaniesinTaiwanandUS

Keypoints

• Thisisanexampleofaproliferationnetworkcentredaroundasmallfamilycompany.Themembers concernedwereconnectedwith theState throughwhichgoodsandmaterialswerebeingtrans-shipped.

• Thisnetworkwasnotablyresilient:despitedesignationofthemainfigure(AlexTsai)and twoofhis companies, thenetworkadaptedby creatingadditional companies,andexpandeditsproliferationandnon-proliferationactivities.

• Little information is available on the way in which the network was financed byKOMID. The one possiblemethod, cash transferred in Singapore, if it in fact tookplace,wouldillustratefirsttheroleofcashinfinancingofproliferation,and,second,that procurement shipments and their related financial transactions may begeographicallyfarremovedfromeachother.

• Thenetworkwasalsobeingusedfornon-proliferationrelatedbusiness(includinganexampleofreverseprocurementintotheUS).

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Case 2 (DPRK) Financing of proliferation by avoiding international financial transactions

AUnha-3rocketwaslaunchedbytheDPRKinDecember2012.Debrisrecoveredfromthelaunchwasfoundtoincludepressuretransmitters.InvestigationofthesebytheUNPanelofExperts on DPRK revealed that they were purchased by a Taiwan-based company, RoyalTeam Corporation (RTC), from a UK-based company. Two transactions took place, inDecember2006andMay2010.18After theywereshippedtoTaipei,RTChand-carriedthetransmitters on flights via Beijing to Pyongyang19 where they were delivered to a NorthKoreancompany,KoreaChonbokTradingCorporation(KCTC).

RTC said that KCTC paid for the 2006 transaction by a transfer via a Malaysian bank of€71,700. The transfermay have involved the representative of the Bank of East Land inMalaysia(SeeFigure2).

Forthe2010transaction,RTCprovidedtwodifferentdescriptionsof itsreimbursementbyKCTC (although no documentation was provided to support either scheme). The firstmethod (method 1) was bymeans of a payment offset arrangement: RTC and a secondTaiwan-basedcompany,CompanyA, tookpart ina tradefair inPyongyang.ThefairwasorganizedbyaNorthKoreancompany,KoreanInternationalExhibitionCorporation(KIEC).It turned out that the sum Company A owed KIEC for participation of Taiwan-basedcompaniesinthefairwassimilartothatKCTCowedRTCforthepressuretransducers.Theparties’commitmentsweremetbyKCTCpayingKIECasumequivalenttothecostbythepressuretransducers,andCompanyAtransferringanequivalentsumtoRTC.

However, (method2)RTCsubsequentlyclaimedthat ithadbeendirectlypaid incashbyKCTCinPyongyangandthatCompanyAwasnotinfactinvolved.RTCusedthiscashtopayKIECfortheparticipationofTaiwan-basedcompaniesinthetradefair.

18Thesummaryof thiscase is taken fromtheUNPanelonDPRK’sFinalReportof2016 (S/2016/157).TheUKcompanywasnotmadeawareoftheultimateend-user.19Withoutdeclaringthemtocustomsauthorities.

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Figure2.ProcurementofpressuretransducersbyKoreaChonbokTradingCoLtd,andpaymentmethods.

Keypoints

• The payment offset arrangement described here would have been difficult forfinancialauthoritiesor institutionstotrackbecausenofinancialtransactionstookplacethroughtheinternationalfinancialsystem.

• SimilaroffsetarrangementsinconnectionwithcircumventionoffinancialsanctionsonIranweredescribedbytheUNPanelonIran.20

20Para59oftheUNPanelonIranFinalReport2015(S/2015/401).

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Case3(DPRK)Ashippingagentfinancesaproliferationshipment21

In July 2013 Panama Canal authorities detained a North Korean vessel, the Chong ChonGang(CCG),whileitwastransitingthePanamaCanalfromCubatoDPRK.Canalauthoritiesfound a shipment of arms and relatedmaterials concealedunder other cargo22. TheCCGwas operated and managed by Ocean Maritime Management Ltd. (OMM), one of thelargestNorthKoreanshippingcompanies.23

Costs in connection with the voyage of the CCG were paid by Chinpo Shipping (Private)Limited, based in Singapore. Following investigations Singapore authorities filed criminalcharges,andChinpowasconvictedoffinancingofproliferation24inconnectionwithasumofUSD72,016.76thatChinpohadremittedbywiretransferfromaBankofChinaaccounttoa Panama Canal shipping agent25. Additionally, Chinpo was convicted of carrying out anunlicensedremittancebusiness.(SeeFigure3).

According to court documents,26 Chinpo Shipping (Private) Limited was a ships agency,chandlersandgeneralwholesaleimporter/exporter.ItwasoneofthreecompaniesrunbyaChinesefamilythatsharedthesamebusinessaddress,employees,andanemailaccountforcommunicationswithDPRKentities.Theyalsosharedanaccountat theBankofChina (inChinpo’s name). The DPRK Embassy in Singapore used the business as a postal address.ChinpohadbusinessrelationshipswithNorthKoreanshippingcompaniessincethe1980s,andwithOMMsincethemid-1990s.

ChinpouseditsBankofChinaaccounttomanagefundsonbehalfofOMM.MoniesduetoOMM(forexamplefreightcharges)werepaidintotheaccount.MonieswereremittedfromtheaccountatOMM’srequest,forexampletoDPRKvesselowners(whowerenotabletosetuptheirownbankaccountsbecauseofsanctions),orontheirbehalfforsupplies,portchargesorotherdisbursements,orfromoneDPRKshipownertoanother.ChinpoalsousedtheaccounttotransferfundstoOMM.27

AccordingtocourtdocumentsChinpokepttrackofthesefundsonOMM’sbehalf,andtheywere separate from Chinpo’s chandlery and ship agency services. Over three years, 605remittancestookplacetotalingmorethanUSD40m,allrelatedtoDPRKvessels.Chinpowaseffectively operating as a remittance business although had no license to do so fromSingaporeauthorities.

ChinpotriedtohideitsinvolvementwithDPRKcompaniesbyremovingthenamesofDPRKvessels and other identifying details from remittance forms and email correspondence.PaymentsfromChinpo’saccounttookplaceintheabsenceofinvoicesorotherdetails.

21ThiscasestudyhasbeendevelopedwiththeassistanceofAndreaBerger,CenterforNon-ProliferationStudiesatMonterey.22 The arms and related materials included 2 MiG-21 jet fighters, anti-tank rockets, and SA-2 and SA-3 Russian surface-to-air missile systems and their components. 23UNPanelonDPRKFinalReport6March2014(S/2014/147)24 The specific charge was “transferring financial assets or resources that may be reasonably used to contribute to DPRK’s nuclearprogrammesoractivities”.25PublicProsecutorvChinpoShippingCompany(Private)Ltd[2016]SGDC104.Specifically,theJudgeconcludedthatthearmsandrelatedmaterialonboardthevesselcouldcontributetoDPRK’soverallnuclearcapability,andthusthepaymentofUSD72,106.76fortransitfeesthroughtheCanalwasinconnectionwithDPRK’snuclearcapability.26PublicProsecutorvChinpoShippingCompany(Private)Ltd[2016]SGDC10427 Although court documents refer only to an account, or possibly accounts, at Bank of China, media reporting of the case hearingssuggests Chinpo also used accounts at other banks in Singapore for money remittance activities, including United Overseas Bank,InternationalCommercialBank(https://www.nknews.org/2015/09/court-case-reveals-chinpo-shippings-ties-to-north-korea/-accessedon6January2017).

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ThecourtdocumentsrecordthattheBankofChinaqueriedaremittancebyChinpoononlyoneoccasion:inconnectionwithpaymentforexpensesinconnectionwiththeoutwardlegof CCG’s voyage to Cuba. In that instance, the Bank requested details of CCG’s cargo, itsconsigneeinCuba,andtheBillofLading.Thesedetailswereprovided.

Figure3.Theproliferation-relatedpaymenttoC.B.FentonandCo.S.AfromChinpo’saccountattheBankofChinawasfundedfromaremittancebyExpedimarS.A.forashipmentdeliveredbyCCGearlierinitsvoyage.

Keypoints

• Chinpo is an example of a small, family-run company involved in a proliferationnetwork.

• Thecompany’sDPRKbusinessconnectionsgobackmanyyearsandwerewellknownlocally,butitisnotclearwhatmonitoringoftheChinpobankaccount(s)wascarriedout by Bank of China. Clearly some screening of transactions in relation to USsanctions took place because the Bank requestedmore information regarding thepayment inconnectionwithCuba.WithrespecttosanctionsontheDPRK,perhapsChinpohadnodealingswithDPRKentitiessanctionedatthetime.

• However, the sums transferred through Chinpo’s account far outweighed thoseconnectedwithitsdeclaredshippingagent/chandlerybusinessandmighthavebeenflaggedbyscreeningagainstappropriateMLsuspiciousindicators;

• Furthermore,paymentswerebeingmadefromChinpo’saccountintheabsencesofinvoicesorotherdetails;detailswerebeingremovedfromremittanceforms;

• Similarly, it isunusualforshipagentstoholdlargeamountsofmoneyonbehalfofship owners and this might also have been flagged by appropriate monitoringpolicies; Chinpo’s remittance business activities are similar to those described inothercasestudiesinthisreport(seeCases6and14).

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Case4(Iran)FinancingofProliferationin1999:Sometechniqueshavechangedlittle

Althoughthepurposeof thecurrentStudy is to identifycurrent typologiesof financingofproliferation the following case is included here as it shows that some typologies havechanged little over the years. The case dates from 1999 and was provided by Swedishauthorities to FATF for inclusion in the 2008 Report on Proliferation Financing. The 2008reportreads:

In thespringof1999theSwedishCustomsfoundout thataperson(P) inHalmstad,viaapizzeria, had exported a thyratron to Iran that was classified as a strategic product andthereforewassubjecttoexportcontrol.AfteranauditandinterviewwithP,suspicionsgrewthatitwasaquestionofsmuggling.

AsearchwasmadeintheapartmentofPandaseizureofathyratronwasmadeatArlandaAirport.Itwasonitswaytoajurisdictionofproliferationconcern.Earlieranotherthyratronwasalreadyexported.

Pstatedthathehadbeencontactedbyhiscousininthejurisdictionofproliferationconcerninthespringof1998whoworkedatauniversityinthatjurisdiction.ThecousinwantedPtogetathyratrontotheuniversity.TheproducerintheUnitedStatesdirectedPtothebranchinSweden.PstatedhewoulduseitasadegreeprojectataSwedishuniversity.Heforgedanenduserstatementinordertobuythethyratron.

P paid the company 22 000 SEK and delivered the product to Halmstad. P contacted aforwarding company in order for them to export the thyratron to a university in thejurisdictionofproliferationconcern.Pwroteaproformainvoiceinthenameofthepizzeria.The buyer was the university in the jurisdiction of concern. The thyratron was thenexported.

InNovember1998Porderedonemorethyratronafteranorderfromanotheruniversityinthe jurisdiction of concern. P paid the delivery and in 27 May 1999 the thyratron wasdeliveredtoPinHalmstad.

The forwarding company got an assignment to send it to the jurisdictionof concern. TheproductwasnotexportedbecausePhadnotpaidtheforwardingcompanyforthecostofthefreightterminal.PhadtheimpressionthatIranAirwouldonceagainberesponsibleforallexpenseslikelasttime.

During the preliminary investigation the Swedish Customs found documents like dispatchnotesforpaymentfromabroad,interalia,fromthejurisdictionofproliferationconcern.

SwedishauthoritiesprovidedtheKing’sCollegeLondonStudywithadditionalinformationasfollows(seeFigure4):

Individual1(referredtoaspersonPinFATF’s2008report),whooriginallycamefromIrantostudy in Sweden, owned the Pizzeria Bambino in Halmstad. At one point in 1998 hereceived an order by telephone for a thyratron from his cousin. His cousin’s telephonenumber placed him in Iran. Individual 1was instructed by his cousin on how to prepareinvoices.Individual1alsotookordersfromGlenMicaCo,basedinTehranbutIndividual1wasnotengagedinanyothertradewithIran,norwithothercountries,norwithinSweden.

19

Individual1placedanorderforathyratronwithaUKcompany.TheUKcompanysourcedthe equipment from the US. Following receipt in Sweden on 11 June 1998, Individual 1repackagedthethyratronandsentittoAmirKabirUniversityinTehran.28Accordingtoopensource information at the time, Amir Kabir University was identified as having procuredgoodsand/ortechnologyforweaponsofmassdestructionprogrammes,inadditiontodoingnon-proliferation related business. Swedish authorities subsequently determined that thethyratronwascontrolledforexport.29

Individual 1 received payment for this order on 23 September 1998 bymeans of a wiretransferoriginatedbyanindividualinOntario,viaDeutscheBank.

Individual1was subsequentlyasked toprocurea second thyratron. Thishealso sourcedfromtheUKcompanyandonreceipton29May1999,repackaged it fordispatchtoAmirKabirUniversity.Onthisoccasionhewaspaidon18May1999bymeansofawiretransferfromChaseManhattan Bank,New York, initiated by another university, theUniversity ofElmvaSanat(UniversityofScienceandTechnology)inTehran.

ThissecondthyratronwasinterceptedbySwedishCustomswhosubsequentlyinterviewedIndividual 1 (his personal details were on the Customs documents). At the request ofSwedishCustomsfollowing this seizureAmirKabirUniversity suppliedSwedishauthoritieswithanendusercertificateforthefirstthyratron.

Individual1also initiatedtwopaymentstotheaccountof Individual2atBankMelli, Iran:the first for6000Kron2November1998andthesecond,8500Kr,on3March1999.Healso initiated a payment of 8000 Kr on 26 May 1999 to Individual 3’s account atCommerzbank, Hamburg. Swedish authorities speculated that these payments may havebeenkick-backs.

28AmirKabirUniversitywasidentifiedastheIndustrialUniversityofAmirKabir.ItpossessedaUS-suppliedresearchreactorandhotcells.29AccordingtoEUregulation3381/94Annex1item3A228.

20

Figure4.Theelementsof the thyratronprocurementnetwork (adaptationof i2chartprovidedbySwedishauthorities)

Keypoints

• Thiscase isanexampleof financingofproliferation involvinganationalconnectedwithacountryundersanctions.

• Theseordersforthyratron’sappearedtobe“one-offs”,andtransactionmonitoringcurrently practiced by many financial institutions would presumably highlightfinancialtransactionsconnectedwiththeseprocurementsasinconsistentwiththoseexpectedofapizzeriabusiness.

• The channels for paymentwere geographically far removed from the channels forprocurement. The items were procured via the UK, payments were received viaCanada,GermanyandtheUS.

• Academic institutions (universities) were involved in the supply of an end usercertificateforthefirstthyratron,andininitiatingpaymentforthesecondthyratron.

21

Case5(Iran)Financingofprocurementofdual-usevalves30

Individual 4, a Swedish-Iranian dual national, managed a company, Petro Instrument HBregistered in2009byhiswifeandbrother.Thecompanyactedasaprocurerof technicalequipment.MostofitscustomerswerelocatedinIran.

Petro Instrument HB, initially came to the attention of the authorities on the basis ofSuspiciousTransactionsReports(STRs)submittedbytwoSwedishbanks.Thereportsnotedpayments to Petro Instrument from Iran, the first in late 2010, and the second in 2011.InvestigationbytheSwedishFinancial IntelligenceUnitrevealedthatPetro InstrumentHBhadnodeclaredincomeandthatwithdrawalsfromthecompany’saccountweremostlyincash.

In2010,Individual4arrangedtheprocurementandshipmentofaconsignmentofvalvestoacustomerinIran.

Thevalves,dual-usegoods,weretobeexported inviolationofSwedishexportcontrols.31Documentation accompanying the shipment declared it was not dual-use material, butSwedishtechnicalexpertsestablishedthatthevalveswereinfactdual-usegoods.Althoughmanufactured for the petrochemical industry they could also be used in uranium gascentrifugeenrichmentsplants(andforthisreasonwereprohibitedfortransfertoIran).

Furthermore, although according to the air waybill and customs declaration the finaldestination of the shipment was Sharjah in the United Arab Emirates, on the day ofshipment the air waybill was changed to record the final destination as Tehran. Swedishauthoritieswerenotinformedofthechange.

Swedishauthorities,whichwerealreadyinvestigatingIndividual4,interceptedtheshipmentbefore it left the country. A search of Individual 4’s office and home by the authoritiesrevealed several examples of export-related declarations and certificates stating thatexportedgoodswouldnotbeusedforproductionofnuclearweapons.

Investigationbytheauthoritiesdeterminedthat Individual4hadan irregularemploymenthistory and no specialized training or knowledge in the engineering equipment he wasseekingtoprocure.32Hepre-paidmostoftheshipmentstoIran.Initially,hewasreimbursedby payments from Iran via a money exchange company in Sweden; later, he was paidthroughcrossborderwire-transferstoaSwedishbankaccount.Hereceivedacommission.

HeclaimedthatwhileonvacationinDubaihewasapproachedbyanIraniannationalwhosuggestedheestablishacompanyinSwedeninordertoprocureitemsonbehalfofIranianentities.

Theauthoritiesdeterminedthatthelanguagefoundonmanyofthedocumentsdiscoveredin Individual 4’s computer during the search ofIndividual 4’s office could be found usingInternetsearchengines,andincludedlanguagetakenfromthewebsiteofthegovernment’snon-proliferationoffice.

30ThisaccountisbasedonLundDistrictCourtrecords(CaseB3487-11date6Feb2013)31SwedishexportcontrolregulationsbasedonRegulation(EU)No.961/2010relatingtoIran.32Paragraph23,UNPanelonIranFinalreportJune2013(S/2013/331)

22

Keypoints

ThiscaseprovidesawealthoflessonsrelevanttodetectingpossibleFoP:

• Itisanexampleoftherolebankscanplayincounteringproliferation.Byidentifyingsuspicious transactions and submitting STRs banks triggered the subsequentsuccessfulinvestigationsandinterdictionbyauthorities;

• Theindividualinvolvedwasconnectedtothecountryundersanctions;• Hehadanirregularemploymenthistoryandnospecializedtrainingorknowledgein

theengineeringequipmenthewasseekingtoprocure;• Hiscompany’sfinancialprofilewasunusual(nodeclaredincome,cashwithdrawals)

and would presumably be flagged by monitoring procedures in place in manyfinancialinstitutionstoday;

• Experience is important when carrying out due diligence with respect to tradedocumentation. In this case Individual 4 was in a position to fake exportdocumentation.

23

Case 6 (Iran) Circumvention of financial sanctions: A trading company turns into a money remittance business

AccordingtoSwedishauthoritiesthiscasewasinitiatedbyaSuspiciousTransactionReportin December 2008, when the bank concerned raised awareness in relation to a deposit,worthabillionSwedishcrowns,fromIran,andsuspectedviolationoflawsoninternationalsanctions.

Individual 5, who came from Iran to Study at university in Sweden, established AramCompany AB in 1986. According to court documents in connectionwith his conviction in2010 for accounting fraud, the companywas registeredwith local authorities to conduct,amongstotherbusiness,exportandimportofindustrialtechnicalgoodsandservices.33

In late-2007/early-2008 Individual 5 established a business partnership with an Iraniancurrencybroker,whosefamilyhadrunacurrencybrokeringbusinessinTehranforseveralgenerations. Individual 5 opened foreign currency bank accounts at Swedbank and otherbanksinSwedenthroughwhichfundsfromthecurrencybrokerinIranwerechanneledtobankaccountsofcompaniesabroad(seeFigure5).

AramnotifiedtheSwedishFinancialServicesAuthorityin2008thatitwouldalsocarryoutmoney transfer and currencyexchangeoperations as a financial institution. Its customerswould be Iranian small businesses dealing with Europe and China. Payments were to bemadethroughAram'sbankaccountinaSwedishbankandAramwouldreceivecommissions(aboutUSD20foreachservice,cheaperthanabankwouldcharge).

Between fiscal years 2007/08 and 2009/10 a total of 10,724 transactions amounting toaboutKr 11.7bn (roughlyUSD1.3bn)wereprocessed throughAramaccounts at banks inSweden.BycomparisonAram’ssalesweresmall.34According to Swedish authorities, the funds was then transferred from Sweden toindividualsandcompaniesincountriesintheEU,USA,Canada,Japan,China,SouthKorea,UAE,Russiaandothercountries.Swedishauthoritiesstronglysuspectedthatsomeofthetransactionswererelatedtoproliferationfinancing,andconnectedwithaninvestigationinanother country about procurement of proliferation-sensitive items. The Iranian currencybrokerappearedtobeamiddle-maninaproliferationfinancingchain.

33ThisaccountisbasedonUmeåDistrictCourtrecords(CaseB58-10date3May2010)34AramCompanyABreportednetsalesofabout240,000Krin07/08and580,000Krin08/09forexample,andnosaleswerereportedin09/10.

24

Figure5.TheelementsoftheAramCompanyAB’sremittancebusiness

Keypoints

• Thisanexampleoftherolebankscanplayincounteringproliferation.Bysubmittingan STR the bank triggered the subsequent investigations and prosecution byauthorities;

• According to Swedish authorities, this pattern of financial activity, involving thedepositofa largesumofmoney,notnecessarily fromabroad,while theperson inquestiontradeshigh-technologygoodsthatareneverimportedtoSwedenbutsentstraighttoIranoraneighbouringcountry,continuestotakeplace.

• This is another example of an individual involved with circumvention of financialsanctions(andpossiblyfinancingofproliferation)havingaconnectionwithacountryundersanctions;

• Transaction monitoring practices conducted by many financial institutions todaywould presumably detect that the scale of the transactions through Aram’s bankaccountsdidnotmatchthecompany’sstatedbusiness;

• Aram Company’s money remittance business activities appear to resemble thosedescribedinCase3andCase14.

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Case 7 ( Iran) A small broker/intermediary plays a key role in a procurement network (1)

Accordingtodocuments35 filed inconnectionwithhisarrestandconviction, inMarchandJuly 2013 Individual 636 arranged two shipments of a metallic powder to a company inTurkey.ThesewerethenonwardshippedtoacompanyinIran.Thepowder(amixofcobaltandnickel),designedtoprotectsurfacesagainstcorrosionathightemperatures,couldbeusedinaerospace,missileproductionandnuclearapplicationsandrequiredanOFAClicenseforexport.

ThefirstshipmentwaspaidforbymeansofawiretransferinitiatedbytheTurkishcompanythrough a New York-based financial institution to a US-based account maintained byIndividual6.Individual6thenpaidtheUS-basedsupplierofthemetallicpowderbycheque(Figure6).

In July2013, Individual6arrangedasecondshipmentofpowdertotheTurkishcompany.OnthisoccasionhepaidtheUSsupplierbymeansofawiretransferthroughaNewYork-basedfinancialinstitution.HesubsequentlyinvoicedtheTurkishcompanyforthesumplusacommission(about9%).

According to court documents, onbothoccasions theTurkish companywasdescribedonexportdocumentationastheend-userofthepowder.InresponsetosubsequentenquiriesbyUSauthorities,theTurkishcompanyrepresented itselfasan importbusiness, includingitemsusedbymedical industrycustomerstomanufactureimplants.Thecompanyclaimedthatthemetallicpowderwasusedforthispurpose.

35USDistrictCourtEasternDistrictofNewYork,Case16M134,18Feb2016.36AnaturalizedUSCitizenofTurkishdescentandCEOofGlobalMetallurgyLLC,asmallcompanybasedin,NewYork.

26

Figure6.ProcurementpaidforwithatransferfromabankinTurkey

Keypoints

• This is another example of proliferation-related procurement involving a smallbroker/intermediary company, although in this case the shipments concernedappeartohavebeenconsistentwiththebusinessprofileofthecompany.

• Theownerofthesmallbroker/intermediarycompanywasconnectedwiththeStatethroughwhichgoodswerebeingtrans-shipped.

• Although themetallic powder required a US export license it does not appear onNuclear Supplier Group lists, nor lists of other international export controlorganisations.

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Case 8 ( Iran) A probable sanctions circumvention scheme detected by monitoring for suspicious transactions (1)

A trading companywas set up by a foreign national in a country in theMiddle East.37 Aseriesofaccountsonbehalfof thecompanywereopenedatabranchofan internationalbankintheStateconcerned.Theseaccountsweredenominatedinlocalcurrency,euros,USdollars,andotherforeigncurrencies.

The international bankmonitored transactions through the trading company’s account inaccordancewithitsstandardpractices.Thismonitoringrevealedthatthetradingcompanyreceived funds into its local currency account from only one source, This source was asecondcompany,setupbyanotherforeignnational.Theselocalcurrencyfundswerethenquickly switched into foreign currencies and transferred overseas from the company’sforeigncurrencyaccounts(Figure7).

Thisactivitydidnotappearconsistentwithatradingcompany’snormalpatternoffinancialtransactions.Thebankinvestigated,anddiscoveredthattheownersofbothcompanieshadlinkstoIran.ThebanksuspectedthefundsoriginatedinIranandthatthetradingcompany’sbankaccountswerebeingusedtotransferthefundsintotheglobalfinancialsystem.

Figure7.MechanismfortransferringIranianfundsintotheinternationalfinancialsystem

37AnnexVofUNPanelonIranFinalReport2014(S/2014/394)

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Keypoints

• Thebankdetected this apparent scheme to circumvent financial sanctionson Iranthroughmonitoringsuspiciousindicatorsrelatedtomoneylaundering.

• The two companies concernedhad links to a country under sanctions, Iran in thiscase.

• ThepolicyofthebankwastowithdrawfromanybusinesswithaconnectiontoIran.Thusnofurtherdataareavailabletodeterminewhethertheschemewasbeingusedtofinanceproliferation.

29

Case 9 ( Iran) A probable sanctions circumvention scheme detected by monitoring for suspicious transactions (2)

A trading companywas set up by a foreign national in a State in theMiddle East and acompany account opened at an international bank in the State concerned.38 Theinternational bank monitored transactions through the trading company’s account inaccordancewith itsstandardpractices.Thismonitoringrevealedahighturnoverof funds,andthebanksuspectedmoney-launderingwastakingplace.

Investigationsbythebankshowedthattheforeignnational’sstatedemploymentwasasamember of staff in a second company. This second company had the same telephonenumberasthetradingcompany.

Furtherinvestigationrevealedthatthistelephonenumberwasthesameasthatbelongingtotwofurthercompaniespreviously identifiedbythebankashaving Iranianshareholdersand being involved in Iranian business (see Figure 8). The bank therefore suspected thetradingcompanywasbeingusedasafrontforIranianbusiness.

Figure8.Commontelephonenumberslinkcompaniesinasuspectedsanctionscircumventionscheme


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Keypoints

• Thebankdetected this apparent scheme to circumvent financial sanctionson Iranthroughmonitoringforsuspiciousindicatorsrelatedtomoneylaundering.

• Thecompaniesconcernedhadlinkstoacountryundersanctions,Iraninthiscase.• ThepolicyofthebankwastowithdrawfromanybusinesswithaconnectiontoIran.

Thusnofurtherdataareavailabletodeterminewhethertheschemewasbeingusedtofinanceproliferation.

31

Case 10 (Iran) A probable sanctions circumvention scheme detected by monitoring for suspicious transactions (3)

AcompanywassetupinaStateintheMiddleEastbyanationaloftheStateconcerned,inpartnershipwithaforeignnationalasaminorityshareholder.39

An account was opened on behalf of the company at an international bank in the Stateconcerned.

Monitoringbytheinternationalbankoftransactionsthroughthetradingcompany’saccountrevealed that multiple large payments were being made from this account to severalcompanies at the same address in a State in Europe.Multiple large paymentswere alsobeingmade to a second set of companies sharing the same address in a second State inEurope(Figure9).

Thebankidentifiedthispatternoftransactionsaspossiblemoneylaundering.Itcarriedoutfurther investigation that revealed that the national of the State in theMiddle East alsomanagedanothercompanythatdidbusinesswithIran.

Figure9.SuspectedschemetotransferfundsfromIrantocompaniesinEurope


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Keypoints

• Thebankdetected this apparent scheme to circumvent financial sanctionson Iranthroughtriggeringsuspiciousindicatorsrelatedtomoneylaundering.

• Thecompaniesconcernedhadlinkstoacountryundersanctions,Iraninthiscase.• ThepolicyofthebankwastowithdrawfromanybusinesswithaconnectiontoIran.

Thusnofurtherdataareavailabletodeterminewhethertheschemewasbeingusedtofinanceproliferation.

33

Case 11 (Iran) Attempt to circumvent sanctions by use of a fake address to hide involvement of an Iranian entity

AfinancialinstitutionwasaskedtoprocessapaymenttoacompanyinaStateneighbouringIran.40ThepolicyofthefinancialinstitutionwastoconductenhancedduediligencewherecompaniesinthisparticularStatewereconcerned.Asaresultthiscompany(thebeneficiaryofthepayment)wasfoundtobelocatedinIran.TheaddressintheneighbouringStatewasfake(seeFigure10).

Figure10.Sanctionscircumventionusingafakeaddress

Keypoints

• The financial institution detected this apparent scheme to circumvent financialsanctions through application of its duediligence procedureswhere the particularStatewasconcerned.

• This is an exampleof the role that companies in countries neighbouring countriesundersanctionsmayplayincircumventingsanctions.


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Case 12 (Iran) Attempt at sanctions circumvention as the beneficiary of a Letter of Credit acts as a front company for an Iranian company

A financial institution was asked to process an import letter of credit (LC) covering ashipmentofgoods.41ThegoodsoriginatedinStateA,inSouthAsia,andwereostensiblytobeshippedfromStateB,neighbouringIran,toStateCinNorthAfrica.

The financial institution investigated the LC, and discovered that the shipment wasconducted by a third company, which was Iranian. The beneficiary of the LC in State BneighbouringIranwasactingasfrontcompanytotheIraniancompany,theactualbeneficialowner,basedoninformationintheLC(seeFigure11).

Figure11.Sanctionscircumventionbyfrontcompanybasedinneighbouringstate

Keypoints

• The financial institution detected this apparent scheme to circumvent financialsanctions through its policy of investigating trade financing schemeswhere StatesneighbouringIranwereconcerned.

• This is an example of the importance of extending checks of Letters of Creditdocumentationbeyondsimplycreditrisks.

• TheexamplealsoillustratesthegeographicalrangeofattemptsbyentitiesinIrantocircumventsanctions.


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Case 13 (Iran) Sanctions circumvention revealed by examination of documents for a shipment to a State neighbouring Iran

An international financial institution was asked to process transactions covering goodsshippedfromaStateAinNorthAfricatoaStateBneighbouringIran.42AreviewofrelatedshippingdocumentsbythefinancialinstitutioninaccordancewithitspoliciesrevealedthatthegoodswereinfactintransittoIran(seeFigure12).

Figure12.Sanctionscircumventionthroughaneighbouringstate

Keypoints

• The financial institution detected this apparent scheme to circumvent financialsanctions through its policy of investigating trade financing schemeswhere StatesneighbouringIranwereconcerned.

• TheexamplealsoillustratesthegeographicalrangeofattemptsbyentitiesinIrantocircumventsanctions.


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Case 14 (Iran) Sanctions circumvention by a company acting as remittance agent on behalf of a company in Iran

AcompanyinIran,CompanyA,enteredintoanagreementwithacompanyinaStateintheMiddleEast,CompanyB,underwhichCompanyBagreedtoacceptorprocesspaymentsonbehalfofcompanyA.43CompanyBhadabankaccountatanon-Iranianfinancialinstitution.

CompanyA informed its customers todirect their payments toCompanyB and informedbeneficiariestoexpectpaymentsfromCompanyB’sbank(seeFigure13).

ItisnotknownhowCompanyBandCompanyAinIransettledtheirfinancialliabilities.

Figure13.Sanctionscircumventionbycompanyactingasremittanceagent

Keypoints

• CompanyB’sroleasamoneyremitteronbehalfofCompanyAwaspresumablynotdeclaredwhen thebankonboardedCompanyB’sbusiness.Monitoringof financialtransactionsofCompanyBpresumablytriggeredanalertasbeinginconsistentwithitsexpectedfinancialprofile.

• The services provided by Company B to Company A appear similar to themoneyremittance activities described in Case 3 and Case 6. Bank accountswere used toreceive and transmit funds on behalf of a third party unable to transact businessbecauseofsanctions.


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Case 15 (Iran) Sanctions circumvention by an Iranian businessman located overseas who received income from his business in Iran

AnIranianbusinessmansetupabusinessinIransellinggoodsdomesticallyandabroad.44Hemovedabroad,butcontinuedtoownhisbusinessinIranandhereceivedincomefromit.

The businessman received the income in the form of wire transactions originating fromsmall financial institutions located in neighbouring States. The accounts in the financialinstitutionsfromwhichthewiresoriginatedwereaffiliatedwithcompanieslocatedoutsideIran(Figure14).

It is not known exactly how valuewas transferred between the business in Iran and thecompaniesoutsideIran.Itwaspossiblethathawalamethodswereused.

Figure14.IranianbusinessmanbasedoutsideIranreceivesincomefromhiscompanyinsideIran

Keypoints

• DetectingthisschemetocircumventfinancialsanctionsbytransferringfundsoutsideIranwouldrequireafinancial institutiontoimplementahigh-levelofduediligenceduringthecustomeron-boardingprocessandsubsequenttransactionmonitoring.

44AnnexVofUNPanelonIranFinalReport2014(S/2014/394).

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Case 16 (Iran) Sanctions circumvention as a payment to company inside Iran is made through a third company outside Iran

A non-Iranian company located outside Iran, Company A, tried to send a payment to acompany insideIran,CompanyB.ThepaymentwassenttoaspecificaccountpurportedlybelongingtocompanyBatabankinsideIran.

Thepaymentwasrejectedbyaninternationalfinancialinstitutioninthepaymentchain,andareportfiledwithauthorities.CompanyAthenarrangedapaymentforasimilaramounttoathirdcompanyasbeneficiary,CompanyC,locatedoutsideIran.ThenumbergivenforthebeneficiaryaccountnumberwasthesameaccountnumberasCompanyB(Figure15).

ItisnotknowniforhowthissecondattemptedpaymentreachedcompanyB.Opensourcesearches failed to reveal a connection between the Iranian Company B and Company CoutsideIran.

Figure15.RepeatedattempttopayacompanyinIran

Keypoints

• Itisfairlycommonforpaymentsthathavebeenrejectedbyafinancialinstitutiontobere-presentedlater.Somebankshavesystemsinplacetodetectandblocksuchattempts.Inthiscasethebanksubsequentlyspottedtherepeattransactionthroughthereferenceitcontainedtotheaccountnumberoftheinitial,blockedtransaction.

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Case 17 (Syria) A small broker/intermediary plays a key role in a procurement network (2)

According tocourtdocuments filed inconnectionwithhisarrestandconviction,between2008 and 2011, Individual 7 used his company, Global Parts Supply, Inc, based inPennsylvania,USA, to export a rangeof chemicalwarfare-related agents andother itemsdestinedultimatelyforSyria.4546TheseitemswereprocuredfromUSsuppliersandrequiredUS export licenses. The itemswere typically shipped to third countries (UAE,UK, Jordan)against false or misleading invoices; goods and services involved were undervalued ormislabeled,andthepurchasersandend-userslistedondocumentationwereusuallyfalse.

PaymentsforthesegoodsweremadebywiretransferstoaGlobalPartsSupplyaccountatthe People’s National Bank in theUSA. Thewire transfers issued from banks in Lebanon(including the Lebanon and Gulf Bank of Beirut Central District), and in one case anexchangehouse(theZourheirEl-Ariss&SonsExchange,RasBeirut,Hamra-AdonisStr,ArissBldg,Beirut),andinonefurthercasefromabankinJordan(Figure16).

According to court documents, the wire transfers were typically accompanied by blanddescriptions of the transactions they covered, such as “goods value”, “laboratory spareparts”and“valueofindustrialmachinespareparts”.

45https://www.ice.gov/doclib/news/releases/2014/140423philadelphia.pdf46https://www.ice.gov/news/releases/extradited-british-resident-pleads-guilty-conspiracy-illegally-export-restricted

40

Figure16.Paymentsforprocurementinitiatedfrommultiplelocations

Keypoints

• Thiswasanotherexampleofasmallbusiness involvedasabroker/intermediary inprocurementforaproliferationprogram.

• Bland descriptions of proliferation-sensitive goods andmaterials covered by thesefinancial transactions have been recorded in the case of other proliferationnetworks.47 The intention may have been to avoid the shipments concernedattractingtheattentionofauthorities.

• The involvement of exchange houses in financial transactions associated withproliferationhasbeenhighlightedbyUSTreasury.48

• ThiswasanexampleoftheusemadeofStatesneighbouringaStateundersanctionsfortransitortrans-shipmentofgoods,andrelatedfinancialtransactions.

47Basedontheauthor’sexperienceofinvestigationsofinterdictedshipmentsundertakenasamemberoftheUNPanelonIran.48 The Use of Exchange Houses and Trading Companies to Evade U.S. Economic Sanctions Against Iran 10 January 2013(https://www.treasury.gov/resource-center/sanctions/Programs/Documents/20130110_iran_advisory_exchange_house.pdf

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Case 18 (Pakistan) Practices of an alleged procurement network operating from Pakistan

AccordingtoanIndictmentfiledin2014,49aUS-basedcompany,OptimaPlusInternationalLLC,exportedarangeofdual-useitemstoPakistanbetween2009and2013.TheitemswereimportedbyaPakistanicompany,AfroAsian InternationalPvtLtd,and transferred to thePakistan Atomic Energy Commission, PAEC (see Figure 17). PAEC is listed on the USDepartmentofCommercerestrictedEntityList50,andmanyoftheitemsshouldhavebeensubjecttoexportlicensingapplications.AccordingtotheIndictmentnonewas.

In addition, according to the Indictment, Optima and Afro Asian colluded to mislead USauthorities by falsifying invoices and shipping documents by mis-describing andundervaluingtheitemsshippedtoPakistan.

TheIndictmentdoesnotdescribehowOptimareceivedpaymentfromAfroAsian,norhowAfroAsianwasreimbursedbyPAEC,andcontains littleother informationdirectlyrelevantto FoP. However, the case is of interest because as described some elements of thisPakistani network resemble other networks described above. So banks and financialinstitutions unknowingly involved in processing financial transactions connectedwith thisallegedproliferationnetworkwouldlikelyhavecomeacrosssimilarsuspiciousindicators.

Figure17.Allegedtransfersofdual-useitemstoPakistan

4922January2014,USDistrictCourtforMiddleDistrictofPennsylvaniaCaseNo14CR29USv.ShafqatRana,AbdulQadeerRana,ShahzadRana,OptimaPlusInternationalLLC,AfroAsianInternationalPvtLtd.Thecasehasyettocometocourt.50PAECisonDoC’srestrictedentitylistas“…engagedinactivitiesthatcouldresultininincreasedriskofdiversionofexporteditemstoweaponsofmassdestructionprograms,tonuclearproliferationactivities…”

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Keypoints

• The exporting company based in the US appears to have been a small, privatelyownedbroker/intermediarycompany;

• Theownerof thecompanywas linkedtothecountrywhoseproliferationprogramhewasallegedlysupplying;

• Documentation(suchasshippingdocumentationandinvoices)wasfalsified.

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FATFindicatorsofpossibleproliferationfinancing:AsecondlookHowdotheFATF2008indicatorslookinthelightoftheinformationinthisInterimReport?

Table2 isabrief summaryofmatchesbetweenkeypointsof theabovecase studiesandmaterialinUNPanelreports,andsomeofthetwentyindicatorslistedinFATF’s2008Reporton Proliferation Financing. Those indicators against which, on this basis, no substantialmatchescanbemade,areexcluded.51

Despite the limited dataset covered by this Interim Report it is interesting to note thatalmosthalfoftheFATFindicatorsofpossibleproliferationfinancingappeartobematched.ItistemptingtospeculatethatperhapstheseindicatorsaremoreindicativeofFoPthantheothers,butthedataaretoolimitedasyettoreachanyconclusion.

Table2.IndicatorComparison

FATFIndicatorsofPossibleProliferationFinancing Observations based on STFoPInterimReportcasestudiesandUNPanelreports

No.1 Transaction involves individual or entity in foreigncountryofproliferationconcern.

Multipleexamples(e.g.Cases5,12,14)

No.2

Transaction involves individual or entity in foreigncountryofdiversionconcern.

Multiple examples (e.g. Cases 7and17)

No.8

Based on the documentation obtained in thetransaction,thedeclaredvalueoftheshipmentwasobviouslyunder-valuedvis-à-vistheshippingcost.

Examples cited in UN Panel onIranReport.52

No.10

Customeractivitydoesnotmatchbusinessprofile,orend-user information does not match end-user’sbusinessprofile.

Examples of remittancebusinesses (e.g. Cases 3, 6 and14)

No.11

Orderforgoodsisplacedbyfirmsorindividualsfromforeign countries other than the country of thestatedend-user.

Multipleexamples(e.g.Cases6,7and17)

No.14

The customer or counter-party or its address issimilar to one of the parties found on publiclyavailablelistsof“deniedpersons”orhasahistoryofexportcontrolcontraventions.

Multiple examples described inReportsoftheUNPanelonIran.

No.15 Circuitous route of shipment (if available) and/orcircuitousrouteoffinancialtransaction.

Example described in UN PanelonIranReport.53

No.17

Transaction involves possible shell companies (e.g.companiesdonothaveahigh levelofcapitalisationordisplaysothershellcompanyindicators).

Examples referenced in UNPanelonIranReport.54

No.18 A freight forwarding firm is listed as the product’sfinaldestination.

ExamplesdescribedinUNPanelonIranReport.55

51ExclusionofFATFindicatorsfromthistabledoesnotimplytheyarenotvalidindicatorsoffinancingofproliferation.52Para143UNPanelonIranFinalReportof2013(UNdocumentS/2013/331)53AnnexVofUNPanelonIranFinalReportof2015(S/2015/401)54Paras70,71ofUNPanelonIranFinalreportof2014(S/2014/394)55Paras30and63ofUNPanelonIranFinalReportof2014(S/2014/394).

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STFoPadditionalindicatorsofpossiblefinancingofproliferation

Based on this Interim Report, certain additional indicators of possible financing ofproliferation can also be identified as follows (Table 3): involvement of smallbrokers/intermediaries,involvementofdualnationalsofcountriesofproliferationconcern,involvement of a university in a country of proliferation concern, descriptions of goodsinvolvedarenon-specific,banksnamedasconsignees,andpaymentsfor largenumbersofhigh-technologygoodsthatareneverimported.

Theseadditionalindicatorsofpossibleproliferationfinancingarealittlemorespecificthanthe original FATF indicators, and they could possibly be visible to banks and financialinstitutionsthatmightunknowinglybecomeinvolvedinprocessingthetransactions.

However,astheFATFindicatorssotheseadditionalindicatorsareastartingpointtoassistfinancial institutions to identify financing of proliferation transactions. It is not suggestedthat any one of these additional indicatorswould be definitive by itself, or that they areexclusivetofinancingofproliferation.Noraretheyexhaustive.Forexample,cashmayalsobeanimportantelementofFoP.56

56 Para 194(b) of UN Panel on Iran Final report of 2012 (S/2012/395), Para 146 and FN 33 of UN Panel on Iran Final Report of 2013(S/2013/331).

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Table3.AdditionalPossibleProliferationFinancingIndicators

57AccordingtoSwedishauthorities,someindividuals,followingtheiracquisitionofdual-nationalstatus,havesetupcompaniesdealingwithtechnicallycomplicatedequipmentdespitelackingatechnicalbackground.TheymaybeaskedtocooperatebyrepresentativesofStatesofproliferationconcern.58Para120UNPanelReportonIranof2013(UNdocumentS/2013/331)59Footnoteb,Table1ofAnnex2ofUNPanelonIranreportof2014(UNdocumentS/2014/394)60Seealsopara63ofUNPanelonIranReportof2015(UNdocumentS/2015/401)forreferencestoindividualsconnectedwithuniversitiesinIranthatweresubjecttodesignationsunderUNsanctionsonIran.61Paragraph73ofPanelonDPRKReportof2016(UNdocumentS/2016/157).

STFoP additional indicatorsof possible proliferationfinancing

Observations based on STFoP InterimReportcases

STFoP1 Transactioninvolvesasmallbrokerorintermediarycompany

Multipleexamples(e.g.Cases7,17).Somemayhaveconnectionswithsanctionedcountriesorprogrammes.Businesstheyconductonbehalfofproliferationnetworksmaybeinconsistentwiththeirnormalbusiness.

STFoP2 Transactioninvolvesadual-nationalofacountryofproliferationconcern,whomaylackthetechnicalbackgroundtodealwithcomplexequipmentinvolved.

Case5,57UNPanelonIranreport.58

STFoP3 Transactioninvolvesauniversityinacountryofproliferationconcern.

Case5,UNPanelonIranreports.59,60

STFoP4 Descriptionofgoodsisnon-specific.

AccordingtoUKauthorities,shippingdocumentsforproliferation-sensitiveitemsmayrefertothegoodsbeingshippedonlyas“spares”or“samples”;DPRKPanelonIranReport.61

STFoP5 Abankisnamedasconsignee.

AccordingtoUKauthorities,thepracticeofrecordinganIranianbankastheconsigneeonshippingdocumentsforgoodsexportedtotheUAEbutdestinedforIranhasbeenobservedforseveralyears.ThepracticehasalsobeenobservedforprocurementviaMalaysia.

STFoP6 Paymentsforalargenumberofhigh-technologygoodsthatareneverimported.

AccordingtoSwedishauthorities,thispatternofactivity,inwhichhigh-technologygoodsaresentstraighttoIranoraneighbouringcountryiscontinuing.

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ItisoutsidethescopeofthisInterimReporttoproposestepsthatbanksandotherfinancialinstitutionsmighttaketomitigaterisk,butimplementationofrobust“knowyourcustomer”policies,regularmonitoring,andensuringtradedocumentationischeckednotsimplyforcreditriskbutforsanctionsandproliferationrisk,wouldseempotentiallyusefulsteps.

ConclusionsandSTFoPfutureworkBased on the 18 case studies discussed in this Interim Report a number of indicators ofpossiblefinancingofproliferationcanbeidentifiedadditionaltothoselistedinFATF’s2008Report on Proliferation Financing. These are: involvement in the financial transactions ofsmall brokers/intermediaries, involvement of dual nationals of countries of proliferationconcern, involvementof auniversity ina countryofproliferation concern,descriptionsofgoods involved being non-specific, banks named as consignees, and payments for largenumbers of high-technology goods that are never imported. These additional indicatorscould possibly be visible to banks and financial institutions that might be involved inprocessingthetransactions.Ifconfirmedtheyshouldimproveidentificationoffinancingofproliferation,improveidentificationofunderlyingnetworks,andthusbetterenablespecificactiontobetakentodisruptproliferationofWMD.

Further work is needed to examine and refine, and if necessary add to these additionalpossible indicators. STFoP will continue to collate and analyse information provided bygovernmentsandtheprivatesectorandfinalconclusions,includingasregardsindicatorsofpossibleproliferationfinancing,willbesetoutinthefinalreportoftheStudy,duetoissueinSummer2017.

InthemeantimecommentsonthecontentsofthisInterimReportanditspracticalvaluewillbewelcome,aswillproposals toengagesubstantivelywith theStudy.ContactdetailsarecontainedinAnnex2.

47

Annex1:FATF2008Report:Indicatorsofpossibleproliferationfinancing621. Transactioninvolvesindividualorentityinforeigncountryofproliferationconcern.2. Transactioninvolvesindividualorentityinforeigncountryofdiversionconcern.3. Tradefinancetransactioninvolvesshipmentroute(ifavailable)throughcountrywith

weakexportcontrollawsorweakenforcementofexportcontrollaws.4. Transaction involves individuals or companies (particularly trading companies)

located incountrieswithweakexportcontrol lawsorweakenforcementofexportcontrollaws.

5. Transaction involves shipmentof goods inconsistentwithnormal geographic tradepatterns(e.g.doesthecountryinvolvednormallyexport/importgoodinvolved?).

6. Transactioninvolvesshipmentofgoodsincompatiblewiththetechnicallevelofthecountrytowhichitisbeingshipped,(e.g.semiconductormanufacturingequipmentbeingshippedtoacountrythathasnoelectronicsindustry).

7. Transaction involves financial institutions with known deficiencies in AML/CFTcontrols and/or domiciled in countries with weak export control laws or weakenforcementofexportcontrollaws.

8. Basedonthedocumentationobtainedinthetransaction,thedeclaredvalueoftheshipmentwasobviouslyunder-valuedvis-à-vistheshippingcost.

9. Inconsistencies in information contained in trade documents and financial flows,suchasnames,companies,addresses,finaldestinationetc.

10. Customeractivitydoesnotmatchbusinessprofile,orend-userinformationdoesnotmatchend-user’sbusinessprofile.

11. Order forgoods isplacedby firmsor individuals fromforeigncountriesother thanthecountryofthestatedend-user.

12. Customer vague/incomplete on information it provides, resistant to providingadditionalinformationwhenqueried.

13. New customer requests letter of credit transaction awaiting approval of newaccount.

14. Thecustomerorcounter-partyoritsaddressissimilartooneofthepartiesfoundonpublicly available lists of “denied persons” or has a history of export controlcontraventions.

15. Circuitous route of shipment (if available) and/or circuitous route of financialtransaction.

16. Transaction demonstrates links between representatives of companies exchanginggoodsi.e.sameownersormanagement.

17. Transaction involves possible shell companies (e.g. companies do not have a highlevelofcapitalisationordisplaysothershellcompanyindicators).

18. Afreightforwardingfirmislistedastheproduct’sfinaldestination.19. Wire instructionsorpayment fromordue topartiesnot identifiedon theoriginal

letterofcreditorotherdocumentation.20. Pattern of wire transfer activity that shows unusual patterns or has no apparent

purpose.

62Page54oftheReport.

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Annex2:MethodologyTheKing’s College London Studyof Typologies of Financing of Proliferation is a year-longprogrammeinitiatedinAugust2016.FundingisprovidedbytheExportControlandRelatedBorderSecurity (EXBS)programme,USDepartmentofState,underAwardNo.S-LMAQM-16-GR-1138.

TheresultsarebasedprimarilyoncollationandanalysisoffinancialinformationprovidedbyStates, financial institutions and other private sector entities relating to financing ofproliferationorcircumventionoffinancialsanctions.Suchdataareforthemostpartheldingovernmentsbyfinancialintelligenceunitsandsecurityandintelligenceagencies.Inbanksandotherfinancial institutionstheyareprobablyheldbyfinancial intelligenceunits,otherunitsdedicatedtoinvestigationofsuspicioustransactions,orequivalentbodies.

Thistypeof informationmaybeclassified,sensitive,orgovernedbybankingsecrecy,dataprotection or other considerations. The Study has initiated the process of collecting datathroughmeetingstoenabledetaileddiscussionoftheStudy’sobjectivesandmethodologytoensurepotentialstakeholdershaveconfidenceinprocedurestosafeguardtheirdata.

The Study is conducted, and information held, in accordancewith King’s College Londonstandards on ethics and data security. In particular nomaterial is included in the Study'sreportswithoutpermissionfromtheowner.

The Study is not seeking classified, sensitive or protected data but has drawn on andcontinues to seek anonymised or desensitised information in the formof case studies oranalysesthatenableidentificationofpatternsortrendsofFoP.Includingforexample:

• Identificationoftypesofentitiesinvolved,andtheirlocation;• Studyoftheroleoffrontcompaniesandtheindividualsinvolved• Identification of patterns characteristic of different sectors (eg, money service

businesses),• Identificationofchannelstypicallyused,• Determinationofmaincurrent trends (for instance, lettersofcreditasopposedto

openaccount);• Comparisonofpastproliferationandembargocircumventionpracticesandpatterns

withcurrenttrends;• Identificationofdifferencesbetweentypologiesofdifferentnetworks(e.g.Iranand

NorthKorea);• Comparisonofproliferation financewith respect tonuclear, chemical orbiological

WMD;• Understandingof the roleofhawala andother informal channels for proliferation

andcircumventionofsanctions;

49

Contacts with potential stakeholders have been initiated either through existingconnections,throughintroductionsorbymeansofrecommendationsfromEXBSofficials.

In addition, the Study has participated in meetings in order to expand outreach to theprivate sector. A briefwas also submitted for circulation by theWolfsberg Secretariat toparticipantsattheWolfsbergmeetingWashingtonDCon7/8December2016.

ForfurtherinformationabouttheStudypleasecontact:

DrJonathanBrewer,VisitingProfessoratKing’sCollege,London,currentlybasedinNewYorkCity.Tel+19179007636(mob),+447815848418(mob),[email protected],or

MrIanStewart,SeniorResearcherintheDepartmentofWarStudiesatKing’sCollegeLondon,andHeadofProjectAlphaonNon-Proliferation.Tel+442078481342(off)[email protected].

www.projectalpha.eu