Cannabis Black Market Luring Farmers in Morocco
In 2022, Morocco legalized the cultivation of cannabis for medical, pharmaceutical and industrial use and remains one of the world’s biggest producers. Morocco’s cannabis regulator, ANRAC, reports that about 5,000 farmers entered the legal sector in 2024, up from only 430 in 2023. Legal output also increased fourteenfold in 2024 compared to the first regulated harvest.
Despite this growth, the illicit trade remains far larger, driven by strong recreational demand across Europe and Africa. Official figures show roughly 5,800 hectares of land under licensed cultivation vs. more than 27,000 hectares still farmed illegally. Complex licensing procedures are major deterrents for many growers. Advocates argue that extending legalization to recreational use could help incentivize farmers to take the legal path.
The persistence of the black market brings significant risks if cooperatives source from illegal producers.
Implications for brokers and their clients:
- Explore coverage designed for the cannabis industry, which may cover regulatory investigations, product liability, and business interruption.
- Review policies for exclusions tied to unlawful activity.
- Coverage for crisis management and PR support may be crucial if links to illicit operations damage trust with customers or investors.
Source: Reuters. (July 29, 2025). Legal cannabis blooms in Morocco but black market still beckons.
AI Hallucinations: Impossible to Stop?
AI hallucinations are where language models generate fabricated information or unfounded claims. GPT-5 reportedly produces fewer false citations than previous versions and engages in less ‘deception’, where a system claims to have performed a task that it hasn’t.
Newer models tend to mimic human reasoning more closely and therefore, hallucinate more often. GPT-5 appears to be an exception to that trend. But researchers caution that hallucinations might be impossible to eliminate entirely as LLMs work by generalizing based on learned associations — and not verifying accuracy.
Recent studies highlight both the progress and the limitations of LLMs. One evaluation showed that GPT-5 had a correctness score of 55% when answering open-ended computer science questions, compared to 54% for scientists. It lagged behind the institute’s literature-review system, OpenScholar, which scored 57%.
The stakes of AI hallucinations are significant. They can distort trend analysis, skew recommendations, and lead to poor decision-making with direct compliance implications.
Implications for brokers and their clients:
- Ensure tech E&O policies cover the risks posed by emerging tech.
- Companies relying on external AI providers should ensure coverage extends to third-party risk.
- Hallucinations may generate content that infringes copyrights or trademarks. Review policies to ensure IP-related disputes are covered.
Source: Nature. (September 6, 2025). Can researchers stop AI making up citations?
Space Junk Risk: Catastrophic Collisions Could Trigger Liability Storm
Satellite insurance providers must rigorously analyze collision risk and the scale of consequence if collision occurs.
The chart from NASA’s EVOLVE model shows that the debris created from a collision is a function of the masses involved and their relative velocity. A catastrophic collision is defined as one where both objects are destroyed, which is shown in the yellow area of the chart. In a non-catastrophic collision, the item of lower mass is destroyed and the other, cratered.
Most close approaches in Low Earth Orbit occur at relative velocities around 10,000 m/s — high enough that, if objects are comparable in mass, a catastrophic collision can produce thousands of debris fragments. This dramatically increases liability for orbital pollution-related disputes and claims.
Implications for brokers and their clients:
- Verify that satellite insurance policies cover both launch and in-orbit phases.
- Ensure policies include collision risk, debris damage, and third-party liability from orbital incidents.
- Business interruption coverage can mitigate against loss of service from a damaged satellite.
Source: NASA. (September 28, 2023). Step 2 Close Approach Risk Assessment
Growing Cybercrime Challenges in Africa’s Fintech Sector
The expansion of embedded finance in Africa introduces new cybersecurity challenges. The integration of financial products into third-party platforms amplifies the attack surface for cybercriminals, increasing risks related to data breaches, fraud, and identity theft. What’s more, the dispersed nature of embedded finance ecosystems complicates traditional security oversight, making third-party risk management essential for maintaining financial system integrity.
Implications for brokers and their clients:
- Ensure cyber liability policies account for novel and advanced threats.
- Ensure coverage extends to breaches and fraud occurring through third-party platforms.
- Confirm coverage for forensic investigation, notification, and remediation expenses following a breach.
Source: The Business & Financial Times. (September 8, 2025). Financial Security (FinSec) Series with Philip Takyi (Dr): Embedded Finance and the New Age of Cybercrime in Africa: Navigating Third-Party Risks in a Global Ecosystem
International Hacking Ring Thwarted
The Seoul Metropolitan Police Agency (SMPA) recently dismantled one of the most sophisticated cybercrime operations in recent history, uncovering the theft of approximately $30 million (39 billion won) from 258 high-profile victims including corporate executives and celebrities.
The international hacking ring used advanced techniques such as hacking government and financial websites to steal personal information. They then used this information to create fraudulent phone accounts to access victims’ bank and crypto accounts.
Despite attempts to obscure their tracks using cryptocurrency, authorities used blockchain intelligence tools to trace the flow of stolen funds across multiple blockchains, leading to arrests and successful disruption of the criminal network.
Implications for brokers and their clients:
- Crime insurance for financial institutions should explicitly cover theft, hacking, and fraud involving cryptocurrencies and digital wallets. Traditional policies may exclude losses tied to digital assets.
- Policies should explicitly protect against losses while assets are held in custody, including theft from wallets, unauthorized transfers, or breaches of private key management.
- Ensure coverage for investigations or penalties from regulators arising from breaches or failures in digital asset management.
Source: Chainalysis. (September 8, 2025). Seoul Police Crack International Hacking Ring
Staggering $4.5 Million Fine Hits Norwegian Lottery Operator
Norway’s gambling regulator has fined state-owned lottery operator Norsk Tipping NOK 46 million ($4.5 million) after uncovering a long-running technical fault that skewed results in Eurojackpot and Lotto ‘super draws’. The error disproportionately favored group entries such as syndicates and betting pools, giving them far higher winnings than individual players. This had been going on since 2015, affecting millions of players.
Although Norsk Tipping fixed the issue in early 2025, regulators criticized its slow response despite earlier warning signs.
This is the latest in a series of compliance failures for Norsk Tipping, which has also faced penalties for payout errors and flaws in its self-exclusion system.
Regulators stress that restoring trust in fairness and transparency is now essential for the company as public scrutiny intensifies.
Implications for brokers and their clients:
- Gambling providers must ensure policies cover technical and operational failures, including software glitches that distort outcomes.
- Explore add-ons for PR/crisis management costs if trust is damaged by system errors.
- Confirm whether coverage includes defense costs and liabilities linked to investigations, compliance breaches, or license reviews.
Source: NewsNet5. (September 2, 2025). Norsk Tipping fined NOK 46 million over lottery draw errors.
