Introduction
Stay updated on recent enforcement actions and sanctions around the G-20 nations with our weekly digest.
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Key Enforcement Actions:
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Brazil:
Date: 3 July 2024
- Authority: Comptroller General of the Union (CGU)
- Summary: The CGU and Federal Police launched Operation João Romão to investigate fraud in public tenders for works by the City of Corumbá, where contracts worth over R$12 million were allegedly directed to a company linked to a municipal public agent.
- Impact: The alleged misuse of public funds, especially federal transfers, for public works in Corumbá (MS) undermines resources meant for vulnerable populations, impacting the delivery of essential social services in a municipality where a significant portion of the population relies on social policies.
- Action Required: The authorities need to continue the investigation, execute search and seizure warrants, and gather evidence to prosecute those responsible for the fraud.
- Read More: https://www.gov.br/cgu/pt-br/assuntos/noticias/2024/07/cgu-e-pf-apuram-fraude-em-licitacoes-de-obras-da-prefeitura-de-corumba-ms
Date: 2 July 2024
- Authority: Federal Police
- Summary: The Federal Police launched Operation Black Friday, executing search and seizure warrants, seizing assets, and freezing funds to dismantle a group suspected of embezzling donations intended for flood victims in southern Espírito Santo.
- Impact: This operation addresses the misuse of humanitarian aid, ensuring that the stolen goods are recovered and that those responsible are held accountable, reinforcing transparency and integrity in resource management for disaster relief.
- Action Required: Authorities need to continue their investigation to fully uncover the extent of the embezzlement, recover the stolen donations, and ensure proper legal actions against the suspects.
- Read More: https://www.gov.br/inpi/pt-br/central-de-conteudo/noticias/inpi-obtem-liminar-para-empresa-retirar-falso-site-da-internet
- Authority: National Data Protection Authority (ANPD)
- Summary: The ANPD issued Decision No. 20/2024/PR/ANPD, temporarily banning Meta Platforms Inc. from processing personal data to train its AI, citing violations of the General Personal Data Protection Law (LGPD) following a privacy policy update.
- Impact: The ban affects Meta’s ability to use data from Facebook, Messenger, and Instagram for AI training, with significant implications for Meta’s AI development and compliance obligations. The decision underscores the importance of adhering to LGPD requirements, especially regarding user consent, transparency, and data protection for minors.
- Action Required: Meta must halt the use of personal data for AI training, comply with the suspension, and address the identified LGPD violations to avoid daily fines. They should also enhance transparency and safeguards around data processing practices to align with regulatory expectations.
- Read More: https://www.gov.br/anpd/pt-br/assuntos/noticias/anpd-determina-suspensao-cautelar-do-tratamento-de-dados-pessoais-para-treinamento-da-ia-da-meta
Date: 1 July 2024
- Authority: National Institute of Industrial Property (INPI)
- Summary: The INPI obtained an injunction against LRC da Silva Serviços Administrativos Ltda., requiring the removal of the fake website https://portalinpi.com.br and prohibiting the use of the INPI acronym and logo on all platforms.
- Impact: This action protects customers from being misled by a fraudulent website that impersonates the INPI, ensuring they are not deceived into paying for services falsely presented as those of the official Agency.
- Action Required: Remain vigilant against similar fraudulent websites, ensure any interactions with the INPI are through official channels, and report any suspicious activity to the relevant authorities.
- Read More: https://www.gov.br/inpi/pt-br/central-de-conteudo/noticias/inpi-obtem-liminar-para-empresa-retirar-falso-site-da-internet
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European Union:
Date: 3 July 2024
- Authority: European Commission
- Summary: Europol coordinated Operation MORPHEUS, targeting the criminal abuse of older, unlicensed versions of the Cobalt Strike red teaming tool. The operation involved law enforcement and private sector cooperation, resulting in the takedown of 593 flagged IP addresses associated with criminal activity.
- Impact: The disruption of unlicensed Cobalt Strike usage curtails cybercriminal activities, particularly those linked to major malware and ransomware attacks, enhancing the security and resilience of IT systems globally. It demonstrates the effectiveness of international cooperation and public-private partnerships in combating cybercrime.
- Action Required: Continued monitoring and collaborative efforts between law enforcement and private sector entities are essential to prevent further abuse of security tools. Organisations should stay vigilant, update security measures, and report suspicious activities to support ongoing efforts against cybercrime.
- Read More: https://www.europol.europa.eu/media-press/newsroom/news/europol-coordinates-global-action-against-criminal-abuse-of-cobalt-strike
- Authority: European Commission
- Summary: The European Commission approved Lufthansa’s acquisition of joint control of ITA Airways with the Italian Ministry of Economy and Finance (MEF), contingent on Lufthansa and MEF addressing competition concerns through a series of commitments.
- Impact: The decision allows the transaction to proceed, ensuring competition is maintained on certain short-haul and long-haul routes and at Milan Linate airport. It supports ITA’s long-term sustainability while mitigating the risk of market dominance and reduced competition.
- Action Required: Lufthansa and MEF must comply fully with the agreed commitments, including providing assets to rival airlines, improving competitiveness on long-haul routes, and transferring slots at Milan Linate. An independent trustee will monitor the implementation under the Commission’s supervision.
- Read More: https://ec.europa.eu/commission/presscorner/detail/en/IP_24_3604
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France:
Date: 3 July 2024
- Authority: French Competition Authority (CNIL)
- Summary: The Lithuanian Data Protection Authority, in cooperation with CNIL and other authorities, fined Vinted UAB €2.3 million for GDPR breaches, including mishandling data erasure requests and implementing a “soft ban” without informing users.
- Impact: The fine highlights the importance of transparent data processing practices and protecting user rights on online platforms. It serves as a reminder for companies to adhere strictly to GDPR regulations to avoid similar penalties and reputational damage.
- Action Required: Vinted must rectify its data handling processes to comply with GDPR, ensuring transparent and fair responses to erasure requests and informing users about any restrictive measures like the “soft ban.” Additionally, the company should review and improve its data protection policies to prevent future breaches.
- Read More: https://www.cnil.fr/fr/marche-en-ligne-sanction-de-23-millions-deuros-lencontre-de-vinted
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Germany:
Date: 2 July 2024
- Authority: Federal Cartel Office
- Summary: The Federal Cartel Office fined AVM Computersysteme Vertriebs GmbH, based in Berlin, nearly €16 million for engaging in vertical price fixing with six electronics retailers. AVM, known for its “FRITZ!” brand of telecommunications and network technology products, allegedly restricted price competition by coordinating end-user prices with retailers.
- Impact: The fine underscores regulatory scrutiny against anti-competitive practices in retail pricing, aiming to preserve fair market competition and consumer choice in telecommunications and smart home technology sectors in Germany and Europe.
- Action Required: AVM must cease and desist from further price-fixing activities, implement robust compliance measures to prevent future violations, and ensure full cooperation with ongoing oversight by the Federal Cartel Office to rectify market distortions and uphold fair competition standards.
- Read More: https://www.bundeskartellamt.de/SharedDocs/Meldung/DE/Pressemitteilungen/2024/02_07_2024_AVM.html
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India:
Date: 1 July 2024
- Authority: Reserve Bank of India (RBI)
- Summary: The RBI fined the Gujarat Rajya Karmachari Co-operative Bank Ltd., Ahmedabad, ₹7.50 lakh for failing to comply with RBI guidelines and the Banking Regulation Act, 1949, based on findings from a 2023 inspection.
- Impact: The penalty highlights significant compliance lapses in financial disclosures, inter-bank deposits, interest rate management, and information transparency.
- Action Required: Ensure accurate financial disclosures, provide complete information to RBI inspectors, adhere to inter-bank exposure limits, promptly pay interest on matured term deposits, and improve internal compliance to avoid future violations.
- Read More: https://www.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=58205
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Japan:
Date: 3 July 2024
- Authority: Personal Information Protection Commission (PIPC)
- Summary: The PIPC initiated administrative actions under the Act on the Use of Numbers to Identify Specific Individuals in Administrative Procedures against Kumagaya City, Saitama Prefecture, Act Japan Co., Ltd., and others.
- Impact: The actions underscore regulatory enforcement aimed at ensuring compliance with personal data protection laws in administrative procedures, emphasizing accountability and transparency in handling personal information.
- Action Required: Entities involved must promptly rectify any violations, enhance data protection measures, and cooperate fully with the Personal Information Protection Commission to mitigate risks and uphold regulatory standards.
- Read More: https://www.ppc.go.jp/news/press/2024/240703_02_houdou/
- Authority: Personal Information Protection Commission (PIPC)
- Summary: The PIPC issued an administrative response concerning the handling of personal information by Aya Town, Miyazaki Prefecture, under the Act on the Protection of Personal Information.
- Impact: This response signifies regulatory oversight to ensure compliance with personal data protection standards, emphasizing proper management and safeguarding of individuals’ personal information within administrative practices.
- Action Required: Aya Town must promptly address any identified issues, implement robust measures for protecting personal data, and collaborate fully with the Personal Information Protection Commission to rectify deficiencies and uphold legal obligations.
- Read More: https://www.ppc.go.jp/news/press/2024/240703_01_houdou/
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Russia:
Date: 3 July 2024
- Authority: Federal Antimonopoly Service (FAS)
- Summary: FAS issued warnings to telecom operators MTS, Megafon, and Beeline.
- Impact: The warnings indicate regulatory scrutiny over potential violations or practices deemed against competition laws within the telecommunications sector.
- Action Required: MTS, Megafon, and Beeline must address the concerns raised by the FAS, ensuring compliance with competition regulations and taking corrective actions as necessary to avoid further penalties or sanctions.
- Read More: https://fas.gov.ru/news/33340
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Saudi Arabia:
Date: 2 July 2024
- Authority: Ministry of Human Resources and Social Development
- Summary: The Ministry of Human Resources and Social Development has penalized 23 employers for violating Domestic Workers Regulations, including unauthorized work assignments and breaches of agreed-upon terms. Nine recruitment offices faced license suspensions for non-compliance with regulations, such as financial impropriety and unresolved complaints.
- Impact: These measures aim to enforce compliance, protect domestic workers’ rights, and enhance service standards through the Musaned Platform, ensuring fair labor practices and sector development.
- Action Required: Employers and recruitment agencies must adhere strictly to Ministry regulations to avoid penalties and uphold fair treatment standards.
- Read More: https://www.hrsd.gov.sa/media-center/news/020720242
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South Korea:
Date: 3 July 2024
- Authority: Financial Supervisory Commission (FSC)
- Summary: The Securities and Futures Commission imposed record fines totaling ₩27.173 billion on two affiliates formerly associated with Credit Suisse Group for violating short selling regulations under the Capital Markets Act. This marks the highest fines ever imposed since the introduction of penalties for naked short selling in April 2021.
- Impact: The fines underscore the regulatory commitment to enforcing strict compliance with short selling rules, aimed at maintaining market integrity and preventing disruptions caused by unauthorized trading practices in South Korea’s capital markets.
- Action Required: Affected entities must promptly comply with regulatory directives, cease any unauthorized short selling activities, and implement robust internal controls to ensure adherence to legal requirements and prevent future violations.
- Read More: https://www.fsc.go.kr/no010101/82595?srchCtgry=&curPage=&srchKey=&srchText=&srchBeginDt=&srchEndDt=
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Turkey
Date: 4 July 2024
- Authority: Turkish Competition Authority
- Summary: The Competition Board launched an investigation into Koruma Klor Alkali Sanayi ve Ticaret AŞ based on preliminary findings suggesting potential violations of the Act no 4054 on the Protection of Competition. The inquiry focuses on alleged obstructive and exclusionary practices aimed at stifling competitors within the chlorine alkali sector.
- Impact: The investigation signifies regulatory scrutiny into Koruma Klor Alkali’s business practices, potentially impacting its operations and competitive strategies in the sector.
- Action Required: Koruma Klor Alkali must cooperate with the Competition Board’s investigation, provide necessary information and documents, and ensure compliance with competition laws.
- Read More: https://www.rekabet.gov.tr/en/Guncel/investigation-launched-on-koruma-klor-al-f415241acf39ef1193cc0050568585c9
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United States
Date: 3 July 2024
- Authority: Federal Trade Commission (FTC)
- Summary: The FTC warned eight companies about practices potentially restricting consumers’ right to repair products, including requiring specific parts for warranties and using “void if removed” stickers.
- Impact: These practices may limit consumer options, increase repair costs, and hinder fair competition in repair services, potentially violating consumer protection laws.
- Action Required: Companies must review and adjust their warranty policies to comply with federal law, ensuring consumers’ rights to repair are respected, and reconsider the placement of warranty stickers to facilitate easier maintenance and repairs by consumers.
- Read More: https://www.ftc.gov/news-events/news/press-releases/2024/07/ftc-warns-companies-stop-warranty-practices-harm-consumers-right-repair
- Authority: Environmental Protection Agency (EPA)
- Summary: The EPA announced settlements with Olomana Orchids Inc. and Mari’s Gardens LLC on Oʻahu for violations of the Worker Protection Standard (WPS), involving inadequate worker training and insufficient decontamination supplies for pesticide handler.
- Impact: These settlements underscore the importance of adhering to pesticide safety regulations to protect agricultural workers and their families from pesticide exposure risks.
- Action Required: Both nurseries are required to comply with the WPS by ensuring proper training and providing necessary supplies to handle pesticides safely, reflecting a commitment to worker safety and environmental protection.
- Read More: https://www.epa.gov/newsreleases/epa-fines-two-oahu-nurseries-over-federal-worker-protection-standard-violations
- Authority: Environmental Protection Agency (EPA)
- Summary: General Motors was ordered to retire 50 million metric tons of greenhouse gas credits due to excess CO2 emissions from 5.9 million vehicles (2012-2018) after an EPA investigation.
- Impact: This action aims to mitigate environmental impact and enforce regulatory compliance.
- Action Required: Automakers must uphold emissions standards rigorously.
- Read More: https://www.epa.gov/newsreleases/general-motors-agrees-retire-50-million-metric-tons-greenhouse-gas-credits-resolve
Date: 2 July 2024
- Authority: Federal Trade Commission (FTC)
- Summary: The FTC blocked Tempur Sealy’s $4 billion acquisition of Mattress Firm, citing concerns of anti-competitive practices that could raise prices and reduce choice in the premium mattress market, potentially leading to job losses in competing manufacturing facilities across multiple states.
- Impact:The FTC’s action aims to preserve competition in the premium mattress market, protecting consumer choice and preventing potential job losses in competing mattress manufacturing plants.
- Action Required: Consumers and industry stakeholders should monitor developments as the case progresses through legal proceedings, ensuring fair competition and market access for all mattress suppliers.
- Read More: https://www.ftc.gov/news-events/news/press-releases/2024/07/ftc-moves-block-tempur-sealys-acquisition-mattress-firm
- Authority: Environmental Protection Agency (EPA)
- Summary: The EPA settled with Sunrise Power Company over Safe Drinking Water Act violations at its Sunrise Power Plant in Kern County, California, requiring a penalty payment of $55,788 for permit violations related to its underground injection wells.
- Impact: The violations involved failure to maintain mechanical integrity of an injection well, potentially compromising underground sources of drinking water in the Upper Tulare formation. This settlement underscores the importance of strict adherence to permit conditions to safeguard groundwater resources.
- Action Required: Sunrise Power must rectify the violations, ensure ongoing compliance with the Underground Injection Control Program, and implement measures to prevent future incidents of non-compliance with Safe Drinking Water Act regulations.
- Read More: https://www.epa.gov/newsreleases/epa-settles-safe-drinking-water-act-claims-power-company-southern-california
- Authority: Environmental Protection Agency (EPA)
- Summary: The EPA and DOJ decided to sue three Lower Yakima Valley dairies for nitrate contamination from their operations, endangering local well users. The authorities sought court action to test affected wells, provide alternative drinking water where necessary, and address ongoing pollution issues promptly.
- Impact: This legal action underscores the critical health risks posed by nitrate contamination, including potential risks like methemoglobinemia (“blue baby syndrome”). It aims to protect community members relying on affected wells from these health hazards and ensure access to safe drinking water.
- Action Required: The dairies must comply with court-ordered actions to monitor groundwater, provide nitrate testing and alternative drinking water solutions, and address infrastructure issues contributing to nitrate leakage promptly.
- Read More: https://www.epa.gov/newsreleases/epa-department-justice-sue-lower-yakima-valley-dairies-manure-practices-endangering
- Authority: Federal Trade Commission (FTC)
- Summary: The FTC took action against Arise Virtual Solutions for deceptive practices regarding earnings claims in its gig work opportunities. Arise misled consumers with inflated income promises, failed to disclose essential costs, and targeted vulnerable groups.
- Impact: Consumers were misled into believing they could earn up to $18/hour, but actual earnings were significantly lower due to hidden fees and expenses. This case highlights issues of fairness and transparency in the gig economy, particularly affecting marginalized groups like Black women.
- Action Required: Arise is required to pay $7 million for consumer refunds, substantiate future earnings claims, and comply with FTC rules on business opportunities. Consumers should be cautious of exaggerated income promises and ensure full disclosure before joining similar platforms.
- Read More: https://www.ftc.gov/news-events/news/press-releases/2024/07/ftc-takes-action-against-gig-work-company-arise-virtual-solutions-deceiving-consumers-about-pay
Date: 1 July 2024
- Authority: Federal Trade Commission (FTC)
- Summary: The FTC filed a complaint against groups in central Florida for defrauding consumers with unauthorized billing schemes involving CBD and Keto products, emphasizing consumer protection and regulatory compliance.
- Impact: This action highlights the FTC’s commitment to combating unauthorized billing scams, aiming to protect consumers from deceptive practices in online commerce, particularly related to health and wellness products.
- Action Required: The defendants are required to address the charges brought by the FTC, which include violations of the FTC Act, Restore Online Shoppers’ Confidence Act (ROSCA), and the Electronic Funds Transfer Act. They must respond to the allegations, comply with legal proceedings, and potentially face penalties if found guilty of the charges.
- Read More: https://www.ftc.gov/news-events/news/press-releases/2024/07/ftc-acts-stop-unauthorized-billing-scams-have-taken-over-200-million-consumers
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Key Sanctions:
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USA
Date: 1 July 2024
- Authority: Office of Foreign Assets Control (OFAC)
- Summary: The OFAC sanctioned a Mexico-based money launderer and China-based members of a money laundering organization with criminal links to the Sinaloa Cartel as part of ongoing efforts to disrupt the flow of illicit narcotics into the United States.
- Impact: This sanctioning effort is designed to cut off financial support to major money launderers facilitating the trafficking of fentanyl and other illegal drugs to the U.S., contributing to efforts to combat drug-related deaths and disrupt cartel operations
- Action Required: The Treasury Department, in collaboration with Mexican authorities, continues to target and sanction individuals and organizations involved in money laundering activities linked to drug trafficking, using the Counter-Fentanyl Strike Force to dismantle illicit financial networks.
- Read More: https://home.treasury.gov/news/press-releases/jy2439
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Compliance Tips Staying Compliant
- Tip 1: Regularly review and update compliance policies.
- Tip 2: Conduct internal audits to ensure adherence to regulations.
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