COVID-19 – and Criminal Exploitation
News    ·   30-03-2020
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AUTHOR: Louis de Gabriele; Jasmine Abela

At the height of the COVID-19 international crisis, EUROPOL released a report titled ‘Pandemic Profiteering: how criminals exploit the COVID-19 crisis’. At a time when Member States of the European Union are predominantly preoccupied with measures aimed at stopping the spread of the virus and controlling a raging outbreak, EUROPOL’s report is a stark reminder that society’s need to continue the fight against criminality, is however, hardly misplaced.

The mayor of Palermo has recently issued a blunt warning – crime gangs are preying on people’s hardship and inciting violence. In turn, EUROPOL warns on the alarming adaptability of the criminal underworld and the novel spin given to crimes as old as time, targeting not only the more vulnerable members of society, but also people’s general sense of foreboding. EUROPOL reports on the predominance of the sale of counterfeit and/or sub-standard goods including pharmaceutical products – a practice also confirmed through INTERPOL’s Operation Pangea; as well as several incidents of thefts through deception, with fraudsters approaching their unsuspecting victims by pretending to be law enforcement and/or healthcare officials.

However, COVID-19 is not only a source of a fresh surge of what some may deem as ‘petty’ crime. At a time when businesses have packed up their operations and moved them to several home offices, EUROPOL warns “Cybercriminals are likely to seek to exploit an increasing number of attack vectors as a greater number of employers adopt telework and allow connections to their organisations’ systems”. Malta is hardly immune to such attacks. It is therefore imperative for businesses to ensure that their relocation does not in any way endanger their operations, trade secrets and data, including sensitive information and/or information subject to professional secrecy.  

The present situation also serves as a stark reminder of the requirements set out under the Market Abuse Regulation, Regulation (EU) No 596/2014 which seeks to ensure the integrity of financial markets in the European Union and to enhance investor protection and confidence in those markets by specifically prohibiting any person from (i) engaging or attempting to engage in insider dealing; (ii) recommend that another person engages in insider dealing or induces another person to engage in insider dealing; (iii) unlawfully disclose inside information; (iv) engage in or attempt to engage in market manipulation. Engaging in the said prohibited activities constitutes a criminal offence, punishable by effective, proportionate and dissuasive criminal penalties.

Indeed, several international news organisations have already reported that United States’ senators have allegedly sold stock holdings after being briefed about COVID-19 and the massive impact it will have on the economy, right before prices plummeted. The alleged perpetrators face not only intense media scrutiny, but also the possibility of judicial proceedings in view of a possible breach of the United States’ STOCK Act. Similar to the elements which constitute the general offence of insider trading, this Act provides specifically for information to which public officials may only become privy to by way of their respective roles.

All in all, several challenges lie ahead.  Bearing this in mind, governments, businesses and financial institutions alike should take stock of the situation and act with a view of removing, or at the very least mitigating, the adverse effects of a possible surge in criminal activity, particularly in view of the exceptional circumstances the world at large is labouring under today.

EUROPOL’s report may be found here:

https://www.europol.europa.eu/publications-documents/pandemic-profiteering-how-criminals-exploit-covid-19-crisis

 

 

 

 

 

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