Public Policy Bulletin

Public Policy Bulletin

A Washington insider's view on policy and politics.

Commerce Department Schedules ‘Advisory Committee on Supply Chain Competitiveness’ Meeting for Sept. 10th and 11th

Posted in Uncategorized
Edward Goetz

The next meeting of the Commerce Department’s ‘Advisory Committee on Supply Chain Competitiveness‘ is scheduled for September 10th (1 – 3 pm) and 11th (9 am – 4 pm) in Washington, D.C.  Both meetings are open to the public on a first-come, first-served basis.  Interested parties who wish to submit written comments for consideration by the Committee in advance of the meeting should do so by emailing supplychain@trade.gov no later than September 3rd.

Under consideration are major-competitiveness related topics, including trade and competitiveness; freight movement and policy; information technology and data requirements; regulatory issues; and finance and infrastructure.

The purpose of the Committee is to advise the Secretary of Commerce on the necessary elements of a supply chain that supports U.S. export growth and national economic competitiveness.

The final agenda will be posted here at least one week prior to the meeting.

Advisory Committee meetings such as this one provide industry direct contact with government officials who understand their issues and concerns.  Crowell recommends interested clients take advantage of this opportunity and reminds them that Crowell’s attorneys are available to advise and assist them in how to best advocate their positions on supply chain matters.

Treasury Proposes New Transparency Rule to Identify “Beneficial Owners” of Accounts – Comments Due October 3rd

Posted in Financial Services
Cari StinebowerEdward Goetz

The Financial Crimes Enforcement Network (“FinCEN”), published a Notice of Proposed Rulemaking (“NPR”) to amend the Bank Secrecy Act (“BSA”) with a new Customer Due Diligence (CDD) requirement for certain Financial Institutions (“FI”) to identify and verify the identity of beneficial owners of legal entity customers.  This long-awaited NPR is the result of the Announced Notice of Proposed Rulemaking, published on February 29, 2012, and subsequent industry sector round tables in order to strike a balance between law enforcement’s desire for additional beneficial ownership information and a reasonable burden on financial institutions to collect and maintain additional beneficial ownership information.  Treasury Secretary Jack Lew acknowledged the NPR sounds very technical, but that it is necessary because “banks and brokerages often do not know the identity of the people behind the businesses that open accounts.”  He added, “This makes it easier for financial criminals, terrorist financiers, and sanctions busters to move and launder their dirty money through anonymous shell companies, front companies, and other types of legal entities.”  This NPR is the result of much outreach with the private sector through industry round tables and is intended to establish a single set of requirements rather than leaving the CDD process up to individual industry sectors to develop and define.

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OFAC Changes Its Mind on Aggregate SDN Ownership

Posted in Foreign Affairs / Defense
Cari StinebowerDj Wolff

On August 13, 2014, the Office of Foreign Assets Control (“OFAC”) updated its 2008 guidance regarding how to treat entities potentially owned or controlled by Specially Designated Nationals (“SDNs”).  While the new guidance confirms several longstanding OFAC positions, it also reverses OFAC’s recent guidance with respect to how to address the aggregation of SDN ownership interests in an entity.

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FinCEN Updates List of Jurisdictions with Anti-Money Laundering and Counter – Terrorist Financing Deficiencies

Posted in Financial Services, Foreign Affairs / Defense
Edward Goetz

The Financial Crimes Enforcement Network (“FinCEN”), on August 5, 2014, updated its list of jurisdictions with Anti-Money Laundering (“AML”) and Counter-Terrorist Financing (“CTF”) deficiencies.  U.S. Financial Institutions (“FI”) should review this update to ensure their compliance programs are adequate when conducting transactions in the identified countries.

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Defense Panel Calls for Base Closures, Shifting DoD Budget to Boost Active Duty Force, R&D and Procurement

Posted in Foreign Affairs / Defense
Edward Goetz

A congressionally mandated report from the National Defense Panel, 10 members appointed by the House and Senate Armed Services Committee, paints a gloomy picture of the impact of current force cuts and advocates for base closures, reducing the growth in military health care spending, and cutting DoD civilian and contractor positions.  The panel believes the cost savings from these politically unpopular measures should then be funneled into reversing investment shortfalls in military readiness and present and future capabilities.

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Treasury Secretary Lew Calls for Retroactive Legislation to End Corporate Inversions

Posted in Budget / Appropriations / Taxes, Financial Services, Foreign Affairs / Defense
Erica ElliottEdward Goetz

In a Washington Post op-ed this week, Treasury Secretary Jack Lew appeals to Congress to eliminate the practice of inversion, whereby a U.S. company acquires a foreign company and then uses its foreign address to claim tax status outside the United States.  Secretary Lew notes that many recent media articles have reported a significant number of deals of this type are in the works.

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SEC Charges Smith & Wesson with FCPA Violations; Company Agrees to Pay $2 million in Fines

Posted in Financial Services, Foreign Affairs / Defense
Edward Goetz

On July 28th, the Securities and Exchange Commission (SEC) charged Smith & Wesson Holding Corporation with violating the Foreign Corrupt Practices Act (FCPA) when employees and representatives of the U.S.-based parent company authorized and made improper payments to foreign officials in an attempt to win firearm contracts involving military and law enforcement agencies overseas.  The company agreed to pay $107,852 in disgorgement, $21,040 in prejudgment interest, and a $1.906 million penalty.  Smith & Wesson consented to the order without admitting or denying the findings.

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Federal ACA Exchanges and Tax Credits: Two Federal Circuit Courts Issue Contradictory Rulings

Posted in Health Care
Edward Goetz

Two courts ruled differently on July 22nd on the issue of allowing tax credits to be used to reduce premiums on health insurance purchased through federally-run Affordable Care Act (ACA) exchanges.  A three-judge D.C. Circuit panel decreed that consumers in the three dozen states with federal ACA exchanges are not eligible for subsidies, whereas the Fourth Circuit came to the opposite conclusion.  The states in question have federal regulators because they opted not to establish state-run exchanges.

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FinCEN Names FBME Bank as a Facilitator of Illicit Activity

Posted in Budget / Appropriations / Taxes, Financial Services, Foreign Affairs / Defense
Edward Goetz

The Financial Crimes Enforcement Network (“FinCEN”), on July 17, 2014, identified in a Finding the  FBME Bank Ltd. (formerly known as the Federal Bank of the Middle East) as a foreign financial institution of primary money laundering concern pursuant to Section 311 of the USA PATRIOT Act.  According to the finding, the bank is well-known for its willingness to evade Anti-Money Laundering (“AML”) regulations and is said to be favored by high-risk customers.  Moreover, the finding states that FBME facilitated a substantial volume of money laundering through the Bank for many years.  Specifically, FBME is used by its customers to facilitate money laundering, terrorist financing, transnational organized crime, fraud, sanctions evasion, and other illicit activity through the U.S. financial system.  FinCEN also published a Notice of Proposed Rule Making (NPRM) identifying the financial institution as eligible for the implementation of the fifth special measure under Section 311 of the USA PATRIOT Act. 

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