A wave of concern is sweeping through individuals in Bangladesh who have engaged in money laundering and invested in properties and businesses in the United States. Richard Nephew, the US State Department’s coordinator for global anti-corruption and an expert on sanctions, is currently on a visit that spells bad news for these illicit activities.
Richard Nephew’s reputation for relentlessly pursuing money launderers and corrupt individuals with US sanctions, primarily through the Global Magnitsky Act, has caught the attention of authorities in Bangladesh. Foreign Secretary Masud Bin Momen, after meeting with Nephew, acknowledged that the United States is placing a high priority on global anti-corruption efforts and that sanctions could be applied to any country, not just Bangladesh. The implementation of sanctions in the business and investment sectors could be a real possibility in the future.
An exclusive report by Blitz previously revealed that the US Department of Treasury and the Department of Justice have been investigating at least 11 individuals from Bangladesh who have each laundered over US$5 million and invested in various businesses, including real estate, gas stations, restaurants, and even casinos. These individuals have been under scrutiny for alleged corruption, money laundering, and other financial crimes for the past year, with relevant federal agencies gathering evidence against them.
According to reliable sources, the initial batch of individuals to face sanctions will be these 11, but it is expected that the number will grow in the future.
The relevant offices in Washington DC have shown strong indications that they will impose sanctions targeting these Bangladesh nationals, making Richard Nephew’s current visit of utmost significance.
Furthermore, an undisclosed source at the US Capitol has revealed that the Biden administration is prioritizing the fight against corruption and money laundering. As part of their ongoing efforts to combat financial crimes, the US will begin by implementing sanctions on these 11 Bangladeshi nationals under the Global Magnitsky Act, but the list is anticipated to expand over time.
If all goes as planned, the process of imposing sanctions is set to commence as early as October this year. Money-launderers in Bangladesh should be prepared to face the consequences of their actions as the United States takes a firm stance against corruption and illicit financial activities.
It may be mentioned here that, Richard Nephew believes the efficacy of sanctions relies on the use of pain against a target, while the target may decide to resolve, resist or deactivate this pain. Finding the role of pain and resolve is important in using sanctions successfully.
Currently, there are several categories of sanctions which are:
- Reasons for sanctioning,
- Economic sanctions,
- Diplomatic sanctions,
- Military sanctions,
- Sport sanctions,
- Sanctions on the environment and
- Sanctions on individuals.
But the most fearsome sanctions of all which generally is imposed on individuals is those under Global Magnitsky Act.
The Global Magnitsky program and cooperation with like-minded international partners directly address the objectives outlined in the President’s 2021 Memorandum on Establishing the Fight Against Corruption as a Core National Security Interest. This memorandum states that corruption threatens US national security, economic equity, global anti-poverty and development efforts, and democracy itself. It directs U.S. government action to strengthen efforts to hold accountable corrupt individuals and their facilitators, including by, where appropriate, identifying, freezing, and recovering stolen assets through sanctions or other authorities; bolster the capacity of domestic and international institutions and multilateral bodies focused on establishing global anti-corruption norms; and work with international partners to counteract strategic corruption by foreign leaders, foreign state-owned or affiliated enterprises, and other foreign actors and their domestic collaborators.
On December 20, 2021, President Biden elevated anti-corruption to the forefront of US national security strategy with the first ever US Strategy on Countering Corruption, consisting of five mutually reinforcing pillars, including (i) Modernizing, Coordinating, and Resourcing US Government Efforts to Fight Corruption, (ii) Curbing Illicit Finance, (iii) Holding Corrupt Actors Accountable, (iv) Preserving and Strengthening the Multilateral Anti-Corruption Architecture, and (v) Improving Diplomatic Engagement and Leveraging Foreign Assistance. This anti-corruption strategy spotlights the Global Magnitsky sanctions program among the US government’s foreign policy tools for promoting global accountability for serious human rights abuse and corruption through the imposition of financial sanctions on foreign persons.
Actions taken in 2022 continue to demonstrate the reach, flexibility, and broad scope of Global Magnitsky. The United States responded to serious human rights abuse and corruption globally, deterring and disrupting some of the most egregious behavior by foreign actors.
When considering financial sanctions under Global Magnitsky, the United States prioritizes actions that are expected to produce a tangible and significant impact on corrupt actors, serious human rights abusers, and their affiliates, and prompt changes in behavior or disrupt the activities of malign actors. Sanctions under the Global Magnitsky program aim to target systemic corruption and human rights abuse, including the networks that engage in, facilitate, or perpetuate sustained patterns of such illicit behavior rather than incidental acts by individual targets.
Persons sanctioned pursuant to this authority appear on the Office of Foreign Assets Control’s (OFAC’s) List of Specially Designated Nationals and Blocked Persons (SDN List). As a result of these actions, all property and interests in property of the sanctioned persons that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. Unless authorized by a general or specific license issued by OFAC or otherwise exempt, OFAC’s regulations generally prohibit all transactions by US persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons. The prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person or the receipt of any contribution or provision of funds, goods or services from any such person.
Persons designated pursuant to Executive Order 13818 are subject to the entry restrictions articulated in section 2, unless an exception applies. Section 2 provides that the entry of persons designated under section 1 of the order is suspended pursuant to Presidential Proclamation 8693.
In 2022, the Department took steps to impose visa restrictions, when appropriate, on foreign persons involved in certain human rights violations and significant corruption pursuant to other authorities, including Presidential Proclamations 7750 and 8697, and Section 7031(c) of the Department of State, Foreign Operations, and Related Programs Appropriations Act and will continue to identify individuals subject to those authorities as appropriate. In addition, the Department continues to implement all grounds of inadmissibility in the Immigration and Nationality Act (INA), including INA section 212(a)(3)(E) which renders applicants ineligible for visas if a consular officer has reason to believe that they participated in acts of genocide, torture or extrajudicial killings.
