J5 Countries (Including the U.S. and UK) Are Laser-Focused on FINtech Companies

By Hope Krebs, Partner, Duane Morris LLP

This week the Joint Chiefs of Global Tax Enforcement (J5) brought together investigators, cryptocurrency experts and data scientists in a coordinated push to track down individuals and organizations perpetrating tax crimes around the world.  The J5 (which is comprised of the Australian Taxation Office (ATO), the Canada Revenue Agency (CRA), the Dutch Fiscal Information and Investigation Service (FIOD), Her Majesty’s Revenue and Customs (HMRC) from the United Kingdom and the U.S. Internal Revenue Service Criminal Investigation Division (IRS-CI)) has been working together since 2018 to gather information, share intelligence and conduct coordinated operations in each country’s fight against transnational tax crime.

The annual meeting (referred to by the J5 as “The Challenge”) was focused this year on Financial Technology (FINtech) companies. In its press release issued March 25 (IR-2021-64), the IRS acknowledged that many FINtech companies have adopted compliance regulations and are partnering with governments and law enforcement in prohibiting financial crime.  However, the IRS cautioned that due to the online nature of the products, the novelty and the lack of regulation and compliance in some areas, the FINtech industry can be used by tax avoiders and money launderers to commit crimes.

This year the J5 Challenge was held virtually and split into multiple phases. In the first phase of the Challenge, legal experts from the five countries discussed the fiscal, compliance and criminal options that each country had regarding FINtech companies. During the second phase, the five countries developed a list of specific companies where leads suggested criminal behavior.  By the conclusion of the Challenge, the IRS press release stated that each country identified specific companies that will be a part of their investigations.

The IRS press release also touted two successes this month resulting from J5 collaboration – the early-March indictments of the CEO and an associate of Sky Global on charges that they participated in a criminal enterprise that facilitated the transnational importation and distribution of narcotics through the sale and service of encrypted communications devices, followed by the ten-count indictment earlier this week charging Jason Peltz with securities fraud, money laundering, tax evasion and a variety of other offenses.

This appears to be just the beginning of the J5’s coordinated efforts to clamp down on the use of the FINTech  industry by those seeking to evade taxes and committing financial crimes. For more on the J5, visit the IRS website.

UK National Security & Investment Bill

Over the past decade, the UK has seen foreign direct investment worth three-quarters of a trillion dollars. One of the key elements of the UK government’s strategy for 2021 and beyond must inevitably be to maintain and enhance the UK’s attractiveness as a place to invest and conduct business.

To read the full text of this Duane Morris Alert, please visit the firm website.

We also direct your attention to another Alert discussing the issue of foreign direct investment in Europe in a broader context influenced by the COVID-19 pandemic.

Information Technology Workers – Temporary and Permanent U.S. Immigration Options

U.S. employers seeking to bring foreign information technology (IT) talent to the United States, and IT workers seeking ways to obtain authorization to work in the United States, have several options.  Some of these are geared at college students or recent graduates seeking temporary training, and others are more suitable for degreed professionals,  with increased options for senior or well-established members of the profession.

To read the full text of this post by Duane Morris attorney Susanne Heubel, which includes an overview of the most common U.S. visa categories for the IT industry, please visit the Duane Morris Immigration Law Blog.

CJEU Declares Privacy Shield Invalid but Upholds Validity of Model Clauses (Sort Of)

A sense of déjà vu descended over the international data transfer landscape on July 16, 2020. In a landmark ruling, the Court of Justice of the European Union (CJEU) announced that Privacy Shield, one of the main mechanisms used by companies to transfer personal data from the EU to the United States, is invalid.

To read the full text of this Duane Morris Alert, please visit the firm website.

Attorney General Submits Final CCPA Regulations for Approval

On June 1, 2020 the California Attorney General (AG) submitted the final text of the CCPA regulations to the California Office of Administrative Law (OAL) for approval.  The final regulations appear to be unchanged from the latest draft published on March 11, 2020.

Generally, the OAL has 30 days to review and determine whether to approve the regulations.  But currently, an executive order has granted an additional 60 days to finalize proposed regulations in light of the challenges agencies are facing due to COVID-19.  Additionally, any regulation that is filed June 1 or later would not typically be effective until October 1.  However, an agency can request an earlier effective date if it can demonstrate good cause, which is what the AG has done here.  The AG has requested the OAL approve the regulations within 30 days and that an exception be made such that the regulations will be effective upon filing with the Secretary of State. Continue reading “Attorney General Submits Final CCPA Regulations for Approval”

COVID-19 Responses in the Telecommunications Industry

In response to the COVID-19 pandemic, legislators and telecommunications regulators have focused primarily on promoting telemedicine, remote learning and better availability of broadband service in general, as well as ensuring that low-income customers will be able to keep their telephone and broadband service during the crisis.

To read the full text of this Duane Morris Alert, please visit the firm website.

Top Tips: Keeping Data Safe When Working Remotely

By John M. Benjamin and Edward Pickard

The coronavirus pandemic has had a severe impact on businesses right across the globe and with a third of the world now in lockdown, thousands of businesses have moved most of their workforce to remote working. Although working from home allows a business to continue operating, it brings significant security risks, placing a greater need to maintain compliance with relevant data security requirements.

Maintaining the security of company data is the responsibility of both the employer and employee and continuing to maintain appropriate security measures is critical at this time. Below are some key points for employees and businesses to keep data secure when working remotely. Continue reading “Top Tips: Keeping Data Safe When Working Remotely”

How to Heed Privacy Law in the Midst of a Pandemic

As countries grapple with the global threat of COVID-19, some are leveraging user location data and tracking apps to model potential contamination paths. China has tapped into its facial recognition tools to track the virus and has deployed drones that tell people to wear masks. Singapore has launched an app called TraceTogether which uses Bluetooth to determine who could be at risk of infection. And the United Kingdom is reportedly in talks with telecom providers on how to best use location data to stem the crisis.

But the coronavirus turning the world upside down does not mean companies can throw out the General Data Protection Regulation and the California Consumer Privacy Act, as well as other privacy protections.

To read an excerpt from this article, which quotes Duane Morris partner Sandra Jeskie, please visit the firm website.