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Date: April 30, 2024 Tue
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Results for proceeds of crime
42 results foundAuthor: Cavanagh, Ben Title: A Review Of Reinvestment In Financial Investigation From The Proceeds Of Crime Summary: In January 2010, the Scottish Government provided matched funding of £1 million (£500k from Scottish Government and £500k from the police) to 3 forces to improve their capacity for financial investigation, the range of uses to which it is applied and its overall impact. The funding was intended to increase the number of financial investigators working in police forces with the objective of targeting community level criminal activity. Decisions about the nature of the posts, where they would be based and how they would be tasked and managed, were left for forces to make in light of local needs and priorities. There were however important reference points for senior managers in Force Investigation Units (FIUs) to help inform these decisions. These included a joint Her Majesty's Inspectorate of Constabulary for Scotland (HMICS) and Inspectorate of Prosecution in Scotland (IPS) report about proceeds of crime and financial investigation, with recommendations for the improvement of financial investigation and Proceeds of Crime Act (POCA) systems. They also included a number of training and guidance manuals developed by the National Policing Improvement Agency (NPIA). The stated aims for the reinvestment project were to ‘improve financial investigation’ and ‘increase the number of financial investigators in local force divisions with the objective of targeting community level criminal activity.’ The assessment of the impact of the extra funding is therefore conceived in a number of ways related to these aims including: consideration of how far the new funding supported the achievement of the HMICS/IPS recommendations for POCA and financial investigation, the extent to which police forces realised their own hopes for the local development of financial investigation, and, how far the funding has helped it make its maximum and most efficient contribution to policing outcomes beyond those most directly related to the use of ‘proceeds of crime’ legislation. The research included interviews with senior managers, financial investigators, and officials from other parts of the financial recovery systems, including the Crown Office’s National Casework Division (renamed in March 2011 as the Serious Organised Crime Division) and Civil Recovery Unit, who use the products of financial investigators in their asset recovery work, as well as the collation of available administrative and management data, and analysis of apparent trends. Details: Edinburgh: Scottish Government Social Research, 2011. 34p. Source: Internet Resource: Accessed October 25, 2011 at: http://www.scotland.gov.uk/Publications/2011/10/20092612/10 Year: 2011 Country: United Kingdom URL: http://www.scotland.gov.uk/Publications/2011/10/20092612/10 Shelf Number: 123144 Keywords: Asset ForfeitureCriminal Investigation (U.K.)Financial InvestigationsMoney LaunderingOrganized CrimeProceeds of Crime |
Author: Yikona, Stuart Title: Ill-gotten Money and the Economy: Experiences from Malawi and Namibia Summary: Over the last 20 years, the international community has significantly stepped up its efforts to prevent, detect, and deter money flows related to criminal activities and terrorism financing. Since the early 2000s, this drive has extended to developing countries, with most of them introducing anti-money laundering (AML) policies. The primary driver behind this is law enforcement; these policies are aimed at detecting and tracing flows of ill-gotten money, which would enable authorities to fight and prevent crime and recover assets of crime, corruption, and tax evasion. Insufficient attention has been paid to the economic side of ill-gotten money and the efforts to combat such flows, particularly in developing countries. Why is it critical for them, and what is the case for combating the flows of ill-gotten money in countries severely constrained by a lack of resources and limited technical capacity to implement a full AML-framework? Moreover, why are ill-gotten proceeds relevant to the issue of economic development? What is the magnitude of the ill-gotten money flows from activities that generate such flows? Added to this are concerns that anti-money laundering policies may at times actually jeopardize certain development objectives, such as access to finance for poor people. The core objective of this study is to introduce economics into the international debate about anti-money laundering, and to introduce the idea of the usefulness and effectiveness of such policies. We also hope that we might be able to bridge the gap between the law enforcement and economist communities. Indeed, the 2011 World Development Report (WDR) on conflict, security, and development provides us with a critical framework to think through the link between organized crime and development from an economic perspective. The study focuses on two developing countries: Malawi, a low-income country, and Namibia, a middle-income country. The central questions asked are: Why are “proceeds of crime” relevant for economic development? Do “proceeds of crime” and related policy responses help or harm economic development? One critical step in such analysis is to obtain a better understanding of the magnitude of the domestic or cross-border sources of ill-gotten money in a country: how it is recycled through the economy and across its borders or spent and invested. Only then is it possible to discuss the economic effects of the circulation and allocation of ill-gotten money in developing countries and the economic impact of the underlying activities. While not intended to be exhaustive or definitive, this study is meant to contribute to a better understanding and quantification of the issues relevant to the proceeds of crime and economic development. For practical and operational purposes, and to be grounded in country specifics, this study only focuses on Malawi and Namibia. However, it is hoped that the approach developed in this study will be useful to other developing-country governments in identifying the main sources and magnitude of the flows of ill-gotten money, and the main recycling patterns and their effects on the economy. Such a framework will help governments in developing countries to systematically analyze the potential impact of AML and design and prioritize AML policies. The findings presented in this study are based on an extensive literature research; World Bank discussions with numerous public- and private-sector officials and representatives of the Governments of Malawi and Namibia during a Bank mission in November 2010; and workshops conducted in both countries in February 2011 to obtain feedback on the preliminary findings. In conducting this study, the team adopted an interactive approach. This was critical because mobilization of local expertise is essential not only in establishing a complete picture of current and future AML challenges, but also in designing policy considerations that subsequently are widely supported. Details: Washington, DC: The World Bank, 2012. 114p. Source: Internet Resource: Accessed February 14, 2012 at: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/10/31/000386194_20111031015900/Rendered/PDF/651760PUB0EPI100money09780821388877.pdf Year: 2012 Country: Africa URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/10/31/000386194_20111031015900/Rendered/PDF/651760PUB0EPI100money09780821388877.pdf Shelf Number: 124132 Keywords: CorruptionEconomic DevelopmentEconomics and CrimeFinancial CrimesMoney Laundering (Malawi, Namibia)Organized CrimeProceeds of crimeTax Evasion |
Author: U.S. Government Accountability Office Title: Asset Forfeiture Programs: Justice and Treasury Should Determine Costs and Benefits of Potential Consolidation Summary: Since 2003, the Departments of Justice (Justice) and the Treasury (Treasury) have taken some steps to explore coordinating forfeiture program efforts, including sharing a website for posting notifications and pursuing a contract for seizure efforts abroad. However, limited progress has been made to consolidate the management of their assets. According to department officials, when Congress established the Treasury Forfeiture Fund in 1992, it recognized the differences in the programs' missions, which warranted creating separate programs, and this encouraged independent operational decisions that eventually created differences between the programs. There are some differences between the programs, but both departments seize similar assets such as vehicles. Nevertheless, the departments have not assessed the feasibility of consolidation, including whether such efforts would be cost-effective, and continue to duplicate efforts by separately managing and disposing of their seized and forfeited property. Specifically, Justice and Treasury maintain four separate information technology (IT) asset tracking systems, which perform similar functions to support their respective asset forfeiture program activities. In addition, both departments procure separate national contracts for the management of real property and they separately store assets seized under each program that are in some cases located within the same geographic area. For example, both the United States Marshals Service (Marshals)--the primary custodian of Justice's seized assets--and Treasury maintain vehicle storage facilities, 40 percent of which are within 20 miles of each other. GAO recognizes the separate legal authorities of the asset forfeiture funds, but those authorities do not preclude consolidating certain management activities within the programs. Conducting a study to evaluate the feasibility of consolidation that considers associated costs and benefits, among other things, could help Justice and Treasury effectively identify the extent to which consolidation would help increase efficiency, effectiveness, and cost savings. Both Justice and Treasury operate separate asset forfeiture programs that are designed to prevent and reduce crime through the seizure and forfeiture of assets that represent the proceeds of, or were used to facilitate, federal crimes. Annually, participating agencies within Justice and Treasury seize millions of dollars in assets as a result of their law enforcement activities. In fiscal year 2011, the combined value of assets in these two programs was about $9.4 billion. Beginning in 1988 and through 2003, Congress and GAO have called on Justice and Treasury to consolidate management activities between their programs. GAO was asked to assess the extent to which Justice and Treasury have assessed and acted on opportunities to coordinate or consolidate forfeiture property management activities since 2003 to reduce any duplication and achieve cost savings. GAO interviewed officials to determine actions under way or completed to consolidate their management activities. GAO also analyzed IT asset tracking systems functions and the geographic proximity of contracted facilities that store vehicles, vessels, and aircraft. GAO recommends that Justice and Treasury conduct a study to evaluate the feasibility, costs, and benefits of consolidating their asset management activities. Justice and Treasury concurred with GAO's recommendation. Details: Washington, DC: GAO, 2012. 32p. Source: Internet Resoruce: GAO-12-972: Accessed October 1, 2012 at: http://gao.gov/assets/650/648098.pdf Year: 2012 Country: United States URL: http://gao.gov/assets/650/648098.pdf Shelf Number: 126529 Keywords: Asset Forfeiture (U.S.)Proceeds of Crime |
Author: Doyle, Charles Title: Crime and Forfeiture Summary: Forfeiture has long been an effective law enforcement tool. Congress and state legislatures have authorized its use for over 200 years. Every year, it redirects property worth billions of dollars from criminal to lawful uses. Forfeiture law has always been somewhat unique. By the close of the 20th century, however, legislative bodies, commentators, and the courts had begun to examine its eccentricities in greater detail because under some circumstances it could be not only harsh but unfair. The Civil Asset Forfeiture Reform Act (CAFRA), P.L. 106-185, 114 Stat. 202 (2000), was a product of that reexamination. Modern forfeiture follows one of two procedural routes. Although crime triggers all forfeitures, they are classified as civil forfeitures or criminal forfeitures according to the nature of the procedure which ends in confiscation. Civil forfeiture is an in rem proceeding. The property is the defendant in the case. Unless the statute provides otherwise, the innocence of the owner is irrelevantit is enough that the property was involved in a violation to which forfeiture attaches. As a matter of expedience and judicial economy, Congress often allows administrative forfeiture in uncontested civil confiscation cases. Criminal forfeiture is an in personam proceeding, and confiscation is possible only upon the conviction of the owner of the property. The Supreme Court has held that authorities may seize moveable property without prior notice or an opportunity for a hearing but that real property owners are entitled as a matter of due process to preseizure notice and a hearing. As a matter of due process, innocence may be irrelevant in the case of an individual who entrusts his or her property to someone who uses the property for criminal purposes. Although some civil forfeitures may be considered punitive for purposes of the Eighth Amendments excessive fines clause, civil forfeitures do not implicate the Fifth Amendments double jeopardy clause unless they are so utterly punitive as to belie remedial classification. The statutes governing the disposal of forfeited property may authorize its destruction, its transfer for governmental purposes, or deposit of the property or of the proceeds from its sale in a special fund. Intra- and intergovernmental transfers and the use of special funds are hallmarks of federal forfeiture. Every year, federal agencies share among themselves the proceeds of jointly conducted forfeitures. They also transfer hundreds of millions of dollars and property to state, local, and foreign law enforcement officials as compensation for their contribution to joint enforcement efforts. Details: Washington, DC: Congressional Research Services, 2015. 998p. Source: Internet Resource: CRS Report 97-139: Accessed February 16, 2015 at: https://www.fas.org/sgp/crs/misc/97-139.pdf Year: 2015 Country: United States URL: https://www.fas.org/sgp/crs/misc/97-139.pdf Shelf Number: 134626 Keywords: Asset Forfeiture (U.S.) Proceeds of crime |
Author: Savona, Ernesto U. Title: From Illegal markets to Legitimate Businesses: the Portfolio of Organised Crime in Europe Summary: This is the final report of Project OCP - Organised Crime Portfolio (www.ocportfolio.eu). Aim of OCP is to carry out an exploratory study of the economics of organised crime in Europe, and in particular to address three research questions, which are covered by the three sections of this report: - Where organised crime proceeds are generated, from which illicit markets (Part 1); - Where these proceeds are then invested in the legitimate economy, in which regions, assets and business sectors (Part 2); - The extent to which these proceeds are confiscated by European authorities (Part 3). The project focuses on seven EU member states (Finland, France, Ireland, Italy, the Netherlands, Spain and the United Kingdom), represented by OCP partners, and for which provides an in-depth analysis. However, the report also presents a broader examination of the situation in Europe as a whole. OCP deals with issues crucial from a policy standpoint but which are characterised by a lack of data and of previous studies. OCP addresses this research gap by adopting an innovative methodology and using a wide range of information, both qualitative and quantitative, deriving from very different sources. Despite its pioneering nature and its data limitations, this report represents a first step towards better understanding of how the organised crime business works. In line with the Transcrime research agenda, it is a starting point for a better identification and reduction of the opportunities exploited by criminals to infiltrate illicit and legitimate markets in Europe. In this sense, this report constitutes an important tool for both public and private institutions to improve the assessment of the risks of organised crime infiltration and to strengthen the tracing and the confiscation of criminal assets in Europe. Details: Milan, Italy: Transcrime, 2015. 341p. Source: Internet Resource: Accessed July 13, 2015 at: http://www.transcrime.it/en/pubblicazioni/the-portfolio-of-organised-crime-in-europe/ Year: 2015 Country: Europe URL: https://www.int-comp.org/media/1997/ocp-full-report.pdf Shelf Number: 136004 Keywords: Asset ForfeitureEconomics of CrimeIllicit MarketsOrganized CrimeProceeds of Crime |
Author: Matrix Insight Title: Assessing the effectiveness of EU Member States' practices in the identification, tracing, freezing and confiscation of criminal assets Summary: The EU Action Plan to combat organised crime of April 19971 States that: "The European Council stresses the importance for each Member State of having well developed and wide ranging legislation in the field of confiscation of the proceeds of crime..." Furthermore, the EU Millennium Strategy States that "The European Council is determined to ensure that concrete steps are taken to trace, freeze, seize and confiscate the proceeds of crime". In line with these undertakings, and having regard to the urgency of controlling criminal assets in the face of terrorist threat, the Action Plan for the Hague Programme is currently reviewing EU legislation in this area and, if necessary, will strengthen it. The target date for completing this process is 20083. Obtaining an accurate, reliable and comprehensive overview of the practice of, and provisions for, criminal asset identification, tracing, freezing and confiscation across EU Member States is a critical phase in this process. The European Commission DG JLS therefore commissioned Matrix Knowledge Group (referred to in the text as "Matrix") to provide an overview of the enforcement of confiscation provisions in all EU Member States. For this purpose, Matrix has undertaken a literature review, interviews, case studies and a statistical and qualitative quota sample survey in order to: - map current practice around the investigative, judicial and disposal phases of the asset recovery process, noting use of specific tools and techniques in investigation (with relative frequency of use) and levels of cooperation with banks, financial and nonfinancial institutions; - identify effective practice by country (with a view to knowledge transfer); - identify obstacles to effective implementation of existing legal provisions by country; distinguishing where possible between jurisprudential and other causes of impediment and, where jurisprudential causes are identified, whether modification of the relevant EU instrument would be appropriate; - examine the potential for cooperation and information exchange between EU Member State asset recovery agencies and between those agencies and similar agencies in third party jurisdictions; - set up and, as far as practicable, populate a statistical model of Member States' asset recovery activities; - propose a performance index for asset recovery operations of Member States (such an index may contain input, output and outcome elements); - produce a set of overarching summary conclusions about the effectiveness of asset recovery procedures at an operational level, diagnosis of shortcomings classified by type of cause and recommendations about potential points of treatment intervention and the nature of plausible treatments; - estimate the likely benefits accruing from implementing recommended treatments and identifying the main points of institutional and agency impact; - provide an impact map identifying which Member States are likely to experience the greatest degree of positive change if recommendations are implemented. Details: Brussels: European Commission, Directorate-General Justice, Freedom & Security, 2009. 189p. Source: Internet Resource: Accessed July 13, 2015 at: http://ec.europa.eu/home-affairs/news/intro/docs/20120312/final_asset_recovery_report_june_2009.pdf Year: 2009 Country: Europe URL: http://ec.europa.eu/home-affairs/news/intro/docs/20120312/final_asset_recovery_report_june_2009.pdf Shelf Number: 136006 Keywords: Asset ForfeitureEconomic SanctionsOrganized CrimeProceeds of Crime |
Author: Gavrilova, Evelina Title: Uncovering the Gender Participation Gap in the Crime Market Summary: Using data from the U.S. National Incident Based Reporting System we document a gender gap in the number of crimes committed in the property crime market: only 30% of the crimes are committed by women. Starting from the classical Becker's model on crime we investigate some potential reasons for the participation gap looking at the differential incentives, measured in terms of earnings and probability of arrest. We observe that women obtain on average 32% less criminal earnings and face a 10% higher probability of arrest with respect to males. Once we account for type of crime and the attributes of offending, such as weapons, we find that the earnings gap is zero on average, while females still face a 1% higher probability of arrest than males. We also observe that females sort into offense types, characterized by a lower variation in the earnings risk, which reveals that females in the crime market are more risk averse than males. Furthermore, we analyze the participation gap by looking at the perceived incentives. We estimate the elasticities of crime with respect to the expected earnings and to the expected probability of not being arrested for both genders. We find that males respond to both these incentives, while females respond less to the incentive for higher earnings than males and they do not respond to the probability of arrest. Finally, we use a Blinder-Oaxaca type decomposition technique to measure crime differentials between females and males that arise due to different responses to incentives. We find that, in a counter factual scenario where the female elasticities increase to the level of the male ones, women would commit 40% more crimes than they actually do, reducing the male-female participation gap by almost 50%. Details: Bonn: Institute for the Study of Labor, 2015. 39p. Source: Internet Resource: IZA Discussion Paper No. 8982: Accessed July 20, 2015 at: http://ftp.iza.org/dp8982.pdf Year: 2015 Country: United States URL: http://ftp.iza.org/dp8982.pdf Shelf Number: 136111 Keywords: Crime StatisticsFemale OffendersProceeds of CrimeProperty Crimes |
Author: Galabov, Antoniy Title: Legislation Meets Practice: National and European Perspectives in Confiscation and Forfeiture of Assets: Comparative Report. Summary: In order to disrupt organised crime activities it is essential to deprive criminals of the proceeds of crime. Organised crime groups are building largescale international networks and amass substantial profits from various criminal activities. The proceeds of crime are laundered and re-injected into the economy to be legalised. The confiscation/forfeiture and recovery of criminal or illegal assets is considered as a very effective way to fight organised crime, which is essentially profit-driven. Seizing back as much of these profits as possible aims at hampering activities of criminal organisations, deterring criminality and providing additional funds to invest back into law enforcement activities or other crime prevention initiatives. The relevance of this problematic is in removing the economic gain from serious crime (including, but not limited to drug trafficking, corruption, money laundering, organised crime) in order to discourage the criminal conduct. Its importance is evidenced by the number of multilateral treaties that have been concluded and provide obligations for states to cooperate with one another on confiscation, asset sharing, legal assistance, and compensation of victims. Several United Nations conventions and multilateral treaties contain provisions with regard to confiscation and forfeiture. The issue is also a matter of interest at European Union (EU) level with the new legislation adopted. However challenges still remain and should be addressed, so that cooperation can be more effective, since anti-fraud policy should be targeted in a trans-border perspective. The Stockholm programme called upon the Member States and the Commission to make the confiscation of criminal assets more efficient and to strengthen the cooperation between Asset Recovery Offices (AROs)3; EC report on cooperation between AROs (2011) has identified common capacity problems (insufficient personnel and resources, lack of common legislative framework), inadequate access to databases and judicial statistics. In this context, three national chapters of Transparency International, being also EU Member States, (TI-Bulgaria, TI-Italy and TI-Romania) are conducting a 24-month research and independent civil monitoring over the legal, institutional, and operational modes of the Asset Recovery Offices (AROs) and policies to outline their main strong and weak aspects in terms of competencies, capacity, performance and integrity. The aim of the project "Enhancing Integrity and Effectiveness of Illegal Asset Confiscation - European Approaches", funded by the "Prevention of and Fight against Crime" programme carried out by DG Home Affairs of the European Commission, is to support the effectiveness, accountability and transparency of asset confiscation/ forfeiture policies and practices in Europe, allowing for improved cooperation between authorities in Member states (MSs). The research provided for objective understanding of main strong and weak points in asset confiscation/ forfeiture legal, institutional and policy practices in Bulgaria, Romania and Italy. It became the basis for the independent civil monitoring and the exchange of know-how and good practices. The addressed shortcomings and recommendations will trigger improvement of the institutional and procedural capacities of national confiscation/forfeiture authorities at local and EU level, especially regarding transparency, accountability, integrity, modes of operation, human resource management, coherence with other relevant authorities, access to databases, use of expertise in asset assessments, cost effectiveness. The project findings from the monitoring (lessons learnt) will also be disseminated via the Transparency International network on regional, EU and international level. Ultimately, this means strengthened capacities of AROs, better chances for cooperation between MSs and civil society representatives. The publication is based on the work of the three national chapters of Transparency International that analyse and monitor the national models of confiscation/forfeiture of assets in Bulgaria, Italy and Romania. The aim is to provide information on the national approach on confiscation/forfeiture as regulated by the national law as well as to provide information on its implementation, based on civil monitoring on real cases tackled by the national confiscation authorities. The publication includes summaries of the three national models of confiscation/forfeiture of illegal/criminal assets (Bulgaria, Italy and Romania). In this part a critical analysis of the legislation is made to be used as a basis for identification of strong and weak features of each model. This is the basis for concrete recommendation for improvement of each model. The second part of the publication includes summaries of the reports for monitoring of the activities of the national confiscation/forfeiture authorities in the three countries. The actual reports are presented as attachments at the end of the book. Each monitoring report includes specific recommendations for improvement. The analysis of the indicators for transparency, integrity, accountability and efficiency in the work of confiscation authorities, based on the active monitoring, is provided as well. In addition the paper provides for a model for civil monitoring of the activities of national confiscation/ forfeiture authorities, which is irrelevant of the specific national model and could be used by civil society organizations in any country to monitor the activities of institutions in this respect. The presentation gives a special focus on the elaboration of an "ideal model" for confiscation/forfeiture at national level. This model is perceived as a set of common standards which should be applied in all EU MSs, in order to achieve transparency, accountability, integrity, efficiency and human rights protection, when confiscation/forfeiture procedures are at stake. Last but not least, the book provides for recommendations for adoption of more advanced common European standards at EU level in the field of confiscation/forfeiture of assets. Further improvement of the existing EU regulations shall contribute to the more successful work of national authorities. Details: Sofia: Transparency International Bulgaria, 2015. 132p. Source: Internet Resource: Accessed August 24, 2015 at: http://www.transparency.bg/media/publications/Final_Report_EN_web.pdf Year: 2015 Country: Europe URL: http://www.transparency.bg/media/publications/Final_Report_EN_web.pdf Shelf Number: 136565 Keywords: Asset ForfeitureDrug TraffickingMoney LaunderingOrganized CrimeProceeds of Crime |
Author: Council of Europe Title: Impact Study on Civil Forfeiture Summary: From the late 1980s onwards, the imperative for those (at both international and national levels) seeking to combat serious organised crime and other transnational offences (including corruption, economic crime and drug trafficking) has been to deprive those benefiting from such criminality of the financial rewards that they thereby obtain. As a result, one of the key changes in approach has been a shift in sentencing policy both nationally and as expressed in international instruments from the traditional aim which centred on penal measures up to and including imprisonment, rather than denying criminals of their illicit gains. Although confiscation had been available to courts in a number of jurisdictions from much earlier on, it tended to relate to confiscation of items such as seizure and destruction of drugs, or to weapons if used as instrumentalities to commit crimes. To address the modern trend of increasingly acquisitive (and very often cross-border) criminality the traditional approach was found to be insufficient as the fruits of the offending were still available for a criminal's enjoyment at the end of a prison sentence. The criminal justice sector across regions came to recognize that, if the aim of sentencing policy was to be effective deterrence, then it needed to hit the true aim of such criminality: making a profit. International instruments such as the 1988 Vienna Convention on Drug Trafficking, as the pioneering instrument, introduced the mechanism of confiscation for drug trafficking. This paved the way for extending confiscation to all other acquisitive crimes, including for bribery and corruption (first in a limited way in the UN Convention on Transnational and Organised Crime (UNTOC) and then, in 2003, more comprehensively in the UN Convention Against Corruption (UNCAC)). Meanwhile, in Europe, both the Council of Europe and the EU led the way in taking decisive steps to obligate their respective member states to put in place a framework for the restraint/seizure and confiscation of illicitly obtained assets. This was achieved through, in particular, the Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime and on the Financing of Terrorism 2005 (the Council of Europe 2005 Convention) and four key EU Framework Decisions (2001/500/JHA; 2003/577/JHA; 2005/212/JHA; 2006/783/JHA). It should be noted, however, that the international instruments, although seminal to the development of asset recovery, have focused on post-conviction confiscation/asset recovery and have not, generally, addressed the subject matter of this study, civil forfeiture (sometimes referred to as confiscation in rem). They have certainly not discouraged it and, to that extent, they have left the way open to states to introduce it, but they have not taken the concept forward in any concerted way. The exception, and a powerful indicator of the importance of civil forfeiture in countering corruption, is UNCAC, which obligates each state party to consider whether civil forfeiture should be introduced within its jurisdiction . As a result of the (understandable and necessary) drive to establish a post-conviction confiscation framework in states, the reader is likely to be familiar with the legal mechanism for the recovery of illicitly obtained assets through criminal proceedings, where, at the end of a criminal trial, the Court, upon the application of the prosecution, or as a requirement of law, considers whether property derived from criminal activity should be forfeited so as to deprive the convicted person from enjoying the fruits of his criminality. This is the usual course of events and will, generally speaking, be the preferred option where the accused is found in the territory of a State and there is sufficient evidence to support a criminal prosecution. Indeed, this is, today, the position in most states. Details: Belgrade: Council of Europe, Belgrade Office, 2013. 96p. Source: Internet Resource: Accessed November 9, 2015 at: https://www.coe.int/t/dghl/cooperation/economiccrime/corruption/Publications/CAR/Impact%20Study%20on%20Civil%20Forfeiture_EN.pdf Year: 2013 Country: Serbia and Montenegro URL: https://www.coe.int/t/dghl/cooperation/economiccrime/corruption/Publications/CAR/Impact%20Study%20on%20Civil%20Forfeiture_EN.pdf Shelf Number: 137221 Keywords: Asset ForfeitureFinancial CrimesOrganized CrimeProceeds of Crime |
Author: Forsaith, James Title: Study for an impact assessment on a proposal for a new legal framework on the confiscation and recovery of criminal assets Summary: The confiscation and recovery of criminal assets, which has a long pedigree within the criminal justice systems of many Member States, has in recent decades assumed a prominent position in the fight against organised crime. Led by Italy, many EU Member States have introduced asset confiscation laws which, by targeting the motivation for profit-driven crime, aim to deter would-be criminals. The force of this logic is easily demonstrated at the microeconomic level (by examining the choices facing individual decision-makers) but the macroeconomic consequences of asset confiscation remain poorly researched. Nevertheless, the logic is widely accepted - no doubt in part because depriving criminals of their ill-gotten gains is a politically attractive concept. Although asset confiscation is a popular concept with a basis in international law, EU law and Member State laws, these laws remain underdeveloped and underutilised. It is unlikely that any Member State confiscates a significant proportion of criminal assets and, accordingly, it is unlikely that the laws themselves are achieving their stated aim. To a large extent this may be because asset confiscation presents as a paradigm shift in criminal justice and agents of the state are likely to remain focused upon their tradition roles (arrest and prosecution) unless they face specific incentives to use the available tools. There are noticeable trends towards improved laws and greater utilisation, but these trends are not so strong as to render EU-level action unnecessary. This study for an impact assessment on a proposal for a new legal framework on the confiscation and recovery of criminal assets aims to assist the European Commission by providing inputs in aid of a formal impact assessment. These inputs consist of policy options for EU-level intervention analysed against evaluation criteria. The evaluation criteria and policy options have both been derived in consultation with the European Commission: the former based on the European Commission's own Impact Assessment Guidelines and the latter based on a problem definition produced as part of this study. This problem definition is based on extensive desk research and fieldwork which generated a detailed map of Member State asset confiscation laws, sought to understand their operation in practice and collated available statistical data. Details: Santa Monica, CA: RAND Europe, 2012. 259p. Source: Internet Resource: Accessed November 14, 2015 at: http://ec.europa.eu/home-affairs/doc_centre/crime/docs/RAND%20EUROPE%20Study%20Final%20Report.pdf Year: 2012 Country: Europe URL: http://ec.europa.eu/home-affairs/doc_centre/crime/docs/RAND%20EUROPE%20Study%20Final%20Report.pdf Shelf Number: 137286 Keywords: Asset ForfeitureOrganized CrimeProceeds of Crime |
Author: Clemens, Austin Title: Asset Forfeiture in Texas: DPS and County Interactions Summary: Between 2003 and 2012, law enforcement agencies in Texas confiscated approximately $486 million in asset forfeiture cases. Texas is a target-rich environment for this law enforcement method due to the state's proximity to the Mexican border. Large shipments of drugs are sent north on Texan highways, while money earned from drug trafficking heads south. One of the most active interdiction agencies is the Texas Department of Public Safety (DPS). Stops made by Highway Patrol can sometimes lead to multi-million dollar asset seizures. DPS can pursue either federal or state prosecution of suspects in these cases. This decision has important implications for District Attorneys (DA) in Texas, who receive a share of forfeited funds when state prosecution is pursued but will usually receive nothing in a federal prosecution. The choice can create tension between DAs and DPS. As requested by the legislature, this report explores the dynamic between DPS and the DAs in DPS-initiated forfeitures. Case data in 20 sampled counties from 2003 to 2012 are analyzed to determine: 1) trends in DPS interdiction behavior, 2) net benefits for counties of an average forfeiture case, and 3) patterns of expenditures and reliance on forfeiture funds in counties. Statewide forfeiture audit data reported to the Office of the Attorney General and interviews with DPS officials and nine district attorneys were also incorporated into the analysis. Details: Austin, TX: Texas Office of Court Administration, 2015. 62p. Source: Internet Resource: Accessed November 14, 2015 at: http://www.txcourts.gov/media/782473/sting-report-final.pdf Year: 2015 Country: United States URL: http://www.txcourts.gov/media/782473/sting-report-final.pdf Shelf Number: 137290 Keywords: Asset ForfeitureDrug TraffickersProceeds of Crime |
Author: Transparency International UK Title: Combating Money Laundering and Recovered Looted Gains: Raising the UK's Game Summary: As an anti-corruption body, Transparency International UK (TI-UK) is concerned with preventing money laundering since the facility to launder the proceeds of corruption gives rise to the commission of bribery and corruption offences in the first place. TI helped international banks to establish the Wolfsburg Principles (the global anti-money laundering guidelines for private banking) in 2000. Reports by TI-UK in 2003 and 2004 focused on corruption and money laundering in the UK and the regulation of trust and company service providers, respectively. This report focuses on the following main areas: - Strengthening the UK's defences against dirty money with particular emphasis on improving due diligence by financial and other institutions and organisations required to conduct due diligence on Politically Exposed Persons; - Criminal and civil mechanisms for the recovery of assets that are the proceeds of corruption; and - Bolstering the efforts of the UK's law enforcement agencies and improving the UK's ability to help developing countries in identifying and recovering stolen assets through more efficient processes and procedures. Details: London: Transparency International UK, 2015. 72p. Source: Internet Resource: Accessed November 14, 2015 at: http://www.transparency.org.uk/publications/15-publications/154-combating-money-laundering-and-recovering-looted-gains-raising-the-uks-game/154-combating-money-laundering-and-recovering-looted-gains-raising-the-uks-game Year: 2015 Country: United Kingdom URL: http://www.transparency.org.uk/publications/15-publications/154-combating-money-laundering-and-recovering-looted-gains-raising-the-uks-game/154-combating-money-laundering-and-recovering-looted-gains-raising-the-uks-game Shelf Number: 137766 Keywords: Asset ForfeitureCorruptionMoney LaunderingProceeds of Crime |
Author: Spain. Ministry of Interior Title: White Paper on Best Practices in Asset Recovery. CEART Project Summary: The recovery of assets with a criminal origin is one of the priorities of criminal policy within the European Union, as reflected in several legal instruments on this topic that have been adopted in recent years. The CEART Project, which tries to be a small contribution to the efforts carried out by the European Union in this field, had some ambitious objectives that could not have been reached without the unconditional support of its partners: Rey Juan Carlos University, Europol and the Asset Recovery Offices from Belgium, Scotland (United Kingdom), Hungary and Poland. With the publication of this White Paper on Best Practices in Asset Recovery, a compendium of the most effective current practices in the asset recovery field, in both the European Union and United States and Canada, one of the main goals of the CEART project has been achieved. The exchange of best practices is already included as a key point in Decision 2007/845/JHA, of 6 December 2007 concerning co-operation between Asset Recovery Offices of the Member States in the field of tracing and identifying proceeds from, or other property related to crime, a regulation that represents one of the cornerstones in the field of asset recovery in the European Union. Likewise, the CEART Project has given great importance to the training of the people working in this field. Without these two key points, training and the exchange of best practices, it is difficult to improve the effectiveness of the efforts of the Member States in the tracing and identification of assets coming from crime. Both topics were already highlighted in the Communication from the Commission to the European Parliament and the Council of 20 November 2008 - Proceeds of organized crime: ensuring that "crime does not pay". Details: Madrid: Ministry of Interior, 2012. 292p. Source: Internet Resource: Accessed November 14, 2015 at: http://vangogh.fcjs.urjc.es/~jesus/Home_files/WBoBPiAR_CEART_2012.pdf Year: 2012 Country: International URL: http://vangogh.fcjs.urjc.es/~jesus/Home_files/WBoBPiAR_CEART_2012.pdf Shelf Number: 137295 Keywords: Asset ForfeitureFinancial CrimesMoney LaunderingProceeds of Crime |
Author: Asian Development Bank Title: Denying Safe Haven to the Corrupt and the Proceeds of Corruption Summary: International cooperation among law enforcement agencies and prosecutorial authorities is a key in the fight against corruption. Corrupt officials hide and launder bribes and embezzled funds in foreign jurisdictions. Bribers often keep secret slush funds in banks abroad and launder the proceeds of their crimes internationally. Mutual legal assistance and extradition in corruption cases to gather evidence and bring fugitives to justice has become critical. States need to work together to use these tools more effectively. At present, international judicial cooperation is insufficient. This book captures the legal and practical challenges of mutual legal assistance and extradition, as well as solutions for improvement, discussed during a March 2006 training seminar in Kuala Lumpur, Malaysia. Experts from 26 Asia-Pacific countries and countries party to the OECD Anti-Bribery Convention attended this ADB/OECD Anti-Corruption Initiative for Asia and the Pacific seminar on "Enhancing Asia-Pacific Cooperation on Mutual Legal Assistance, Extradition, and the Recovery and Return of the Proceeds of Corruption". Details: Manila: ADB/OECD, 2006. 167p. Source: Internet Resource: Accessed November 16, 2015 at: http://www.oecd.org/site/adboecdanti-corruptioninitiative/37574816.pdf Year: 2006 Country: Asia URL: http://www.oecd.org/site/adboecdanti-corruptioninitiative/37574816.pdf Shelf Number: 137285 Keywords: CorruptionEmbezzlementProceeds of Crime |
Author: Marshall, Andrew Title: What's Yours Is Mine: New Actors and New Approaches to Asset Recovery in Global Corruption Cases Summary: This study is about recovering money stolen by corrupt politicians and officials. Asset recovery is a key element in deterring and punishing the corrupt, and the reduction of corruption is critical to development. The money can be put to better uses once recovered, and it amounts to billions. But there's another reason why this is significant for those who are primarily focused on development: among the key issues in asset recovery are greater accountability and transparency, which are also increasingly regarded as key to long-term development success. The main argument of this study is that corruption investigations and asset recovery are being tackled in new ways by new actors from the private sector, civil society, and media, and that this can help improve the prospects for justice. It would be too much to call this a revolution: it's an evolutionary process. It needs long-term support if it is to prosper as a policy choice, and it raises some issues for policymakers and those who carry out the recoveries. But if the agenda for accountability is to advance at the same pace as transparency, the prosecution of the corrupt and the return of the money they stole is critical. Details: Washington, DC: Center for Global Development, 2013. 42p. Source: Internet Resource: CGD Policy Paper 018: Accessed January 28, 2016 at: http://www.cgdev.org/sites/default/files/whats-yours-is-mine_0.pdf Year: 2013 Country: International URL: http://www.cgdev.org/sites/default/files/whats-yours-is-mine_0.pdf Shelf Number: 137702 Keywords: Asset ForfeiturePolitical CorruptionProceeds of Crime |
Author: Ribadu, Nuhu Title: Show Me the Money: Leveraging Anti-Money Laundering Tools to Fight Corruption in Nigeria. An Insider Story Summary: The Financial Action Task Force was created during the 1989 G-7 summit in Paris in response to growing concerns over money laundering. It is an intergovernmental body that develops policies and measures to prevent criminals from using the financial system. It studies money laundering and terrorism financing trends and techniques, develops and promotes adequate measures to fight these financial crimes, and monitors its 34 member countries' progress implementing these measures. In 1990, the task force published a plan of action to fight money laundering embodied in a set of 40 recommendations. These recommendations were revised in 1996, and again in 2003, to reflect the evolution of money laundering techniques. Following the attacks of September 11, 2001, the FATF mandate was expanded to support the global fight against terrorism. In October 2001, the Task Force published another set of eight recommendations, dealing specifically with terrorism financing. Another recommendation was added in October 2004, completing what is now known as the FATF's 40+9 Recommendations. These recommendations cover the criminal justice system and law enforcement, the financial system and its regulations, and international cooperation. They are meant to prevent financial institutions from becoming safe havens for criminal activities. In the late 1990s, the FATF cast its net beyond its members with an initiative seeking to identify major weaknesses in anti-money laundering systems worldwide. The idea was to encourage countries identified as weak links to implement international standards. In 2000 and 2001, the task force reviewed laws and regulations in 47 countries, selected on the basis of FATF members' experience. The review pitted rules and practices in these countries against 25 criteria. Of the 47 countries, 23 were found to be severely lacking and were declared non-cooperative. Nigeria was one of these 23 black sheep. In June 2001, following the lack of response to its letters, the FATF concluded that Nigeria was unwilling or unable to cooperate in the review of its system, and therefore should be blacklisted. The task force noted a lack of obligation from financial institutions to identify their clients or report suspicious transactions, inadequate criminalization of money laundering, incompetence or corruption within government, judicial or supervisory authorities, and an obvious unwillingness to respond constructively to requests. In 2002, the U.S. Treasury followed suit and issued an advisory warning to its financial institutions to use extra caution and scrutiny when dealing with transactions involving Nigeria. This was bad news for Nigeria. Being branded as non-cooperative meant that Western financial markets held up their noses. Financial institutions around the world, and particularly those in major financial centers, further scrutinized transactions involving Nigeria, resulting in crippling delays. Nigerian banks had trouble dealing with foreign counterparts. Nigerians wanting to do business abroad faced extra hurdles and were viewed with suspicion. Foreign banks were hesitant to grant letters of credit or loans to Nigerians. The country was becoming a financial pariah. Unlike the high echelons of government, which were blissfully unaware of the FATF decision for a while, local banks and businesses were directly affected and knew all about it. At the same time, Nigerian authorities were keen to obtain relief from the $30 billion in foreign debt owed to the Paris Club of creditors. In a country blessed with such mineral wealth, this crippling debt was another symptom of the mismanagement and corruption that had plagued Nigeria for decades. With the FATF frowning at Nigeria's financial practices and safeguards - or lack thereof - donors were unlikely to be in a debt-forgiving mood. Failure to correct course could result in escalating measures from the FATF. The original blacklisting meant that foreign financial institutions were advised to use extra caution when dealing with Nigeria. But continued failure to cooperate could result in FATF member countries adopting further countermeasures, which could ultimately result in the suspension of all financial transactions with Nigeria. Details: Washington, DC: Center for Global Development, 2010. 76p. Source: Internet Resource: Accessed February 2, 2016 at: http://siteresources.worldbank.org/EXTPUBLICSECTORANDGOVERNANCE/Resources/Showmethemoney.pdf?resourceurlname=Showmethemoney.pdf Year: 2010 Country: Nigeria URL: http://siteresources.worldbank.org/EXTPUBLICSECTORANDGOVERNANCE/Resources/Showmethemoney.pdf?resourceurlname=Showmethemoney.pdf Shelf Number: 137739 Keywords: CorruptionFinancial CrimesMoney LaunderingProceeds of CrimeTerrorist Financing |
Author: Financial Action Task Force Title: Specific Risk Factors in Laundering the Proceeds of Corruption: Assistance to Reporting Institutions Summary: 1. Laundering the Proceeds of Corruption, the first FATF Working Group on Typologies (WGTYP) effort in the area of corruption, discussed the interrelationship between corruption and money laundering, discovered the most common methods used to launder the proceeds of corruption, and highlighted the vulnerabilities leading to an increased risk of corruption-related money laundering. It listed some of the most significant grand corruption cases and created a useful historical understanding and reference point for further work in understanding the interrelationships between corruption and money laundering. Laundering the Proceeds of Corruption ultimately concluded that significant acts of corruption are fruitless without the politically exposed person (PEP) involved having a secondary capability to move and disguise the proceeds of his crime. 2. Laundering the Proceeds of Corruption identified areas in which future work could be done, including gaining an understanding of the correlation between certain risk factors and corruption. It also concluded that while effective anti-money laundering and countering the financing of terrorism (AML/CTF) systems can assist in the detection of the proceeds of corruption and prevent the perpetrators of corruption-related offences from enjoying the proceeds of corruption, historically, reporting institutions have not been effective in detecting corruption-related proceeds. This has occurred for a number of reasons, including that in a number of instances, reporting institutions have failed to engage in appropriate customer identification or otherwise failed to apply AML/CFT controls effectively. In some instances, they were actually complicit, and sometimes willfully blind, in the laundering of funds. 3. This paper is written to assist reporting institutions - those financial and non-financial institutions that have a legal obligation to file suspicious transaction reports, or otherwise engage in AML/CFT due diligence - to better analyse and better understand specific risk factors that may assist them in identifying situations posing a heightened risk of corruption-related money laundering risk. It seeks to answer the question: Are there specific types of business relationships, customers, or products which should lead a reporting institution to pay particular attention to the risk of corruption-related money laundering? As with all FATF typology projects, we seek to answer the question by looking to reported cases to see if we can detect commonalities. In addition, we draw on the industry's and academia's best thinking about risk, as reflected in the published literature, to determine what situations truly represent risk. 4. Within the FATF standards3, Recommendation 12 requires a reporting entity to have in place appropriate risk management systems to determine whether a customer or beneficial owner is a PEP. It must also take specific measures, in addition to performing normal customer due diligence measures for business relationships, with foreign PEPs: senior management approval for establishing (or continuing) business relationships, take reasonable measures to establish the source of wealth or funds, and conduct enhanced ongoing monitoring. For domestic PEPs and persons entrusted with a prominent function by an international organisation, reporting institutions are required to apply the specific enhanced due diligence (EDD) measures set out in Recommendation 12 where there is a higher-risk business relationship. This scrutiny stands at the forefront of the effort to detect and deter the laundering of proceeds of corruption and is certainly necessary. The premise behind the effort is clear: customers in these categories can pose an inherently high risk for money laundering. 5. Understanding risk within the Recommendation 12 context is important for two reasons: First, Recommendation 12 requires a reporting entity to have "appropriate" risk management systems in place to determine whether the customer or the beneficial owner is a foreign PEP, and take "reasonable measures" to determine whether a customer or beneficial owner is a domestic PEP or an individual entrusted with a prominent function by an international organisation. To gauge whether a system is "appropriate," or whether "reasonable measures" have been taken, requires an assessment of risk. Second, understanding risk is important after identifying domestic PEPs or relevant individuals from international organisations, in order to assess what level of EDD is necessary. 6. Moreover, experience teaches us that combating corruption-related money laundering must be more than simply ensuring that PEPs receive an appropriate level of scrutiny. Rather, an effective AML scheme requires an assessment of corruption-related risk and protecting against the laundering of corruption proceeds across the spectrum of customers and business relationships, regardless of whether a FATF-defined PEP is involved. 7. Such an approach acknowledges the realities of the methods of laundering the proceeds of corruption. It is a rare case (although not unheard of) for a PEP to enter a financial institution and deposit (or transfer) significant amounts of suspicious money; such action would likely create unacceptable risks to the PEP of detection by reporting institutions. Instead, as Laundering the Proceeds of Corruption noted, corrupt PEPs will take great pains to disguise the identity and the source of the funds in order to place corrupt money in the financial system without suspicion. PEPs use corporate vehicles, sophisticated gatekeepers, cash, and countries with weak money laundering controls to disguise their funds. Their corrupt transactions will often involve an intermediary of some kind, (including family members and close associates), whether within the PEP's jurisdiction or beyond. In some cases, corrupt PEPs will also try to control the mechanisms of detection and regulation within their home jurisdiction to "game the system" in order to disguise the proceeds before the money gets to another jurisdiction. In such cases, implementation of Recommendation 12 by other jurisdictions is necessary, but is not sufficient to detect and deter the movement of corrupt proceeds. Details: Paris: FATF, 2012. 48p. Source: Internet Resource: Accessed February 8, 2016 at: http://www.fatf-gafi.org/media/fatf/documents/reports/Specific%20Risk%20Factors%20in%20the%20Laundering%20of%20Proceeds%20of%20Corruption.pdf Year: 2012 Country: International URL: http://www.fatf-gafi.org/media/fatf/documents/reports/Specific%20Risk%20Factors%20in%20the%20Laundering%20of%20Proceeds%20of%20Corruption.pdf Shelf Number: 137796 Keywords: CorruptionFinancial CrimesMoney LaunderingProceeds of CrimeTerrorist Financing |
Author: Villa, Edgar Title: Illicit Activity and Money Laundering from an economic growth perspective : a model and an application to Colombia Summary: This paper contributes to the economic analysis of illicit activities and money laundering. First, it presents a theoretical model of long-run growth that explicitly considers illicit workers, activities, and income, alongside a licit private sector and a functioning government. Second, it generates estimates of the size of illicit income and provides simulated and econometric estimates of the volume of laundered assets in the Colombian economy. In the model, the licit sector operates in a perfectly competitive environment and produces a licit good through a standard neoclassical production function. The illicit sector operates in an imperfectly competitive environment and is composed of two different activities: The first activity produces an illicit good that nonetheless is valuable in the market (for example illicit drugs); the second does not add value to the economy but only redistributes wealth (for example robbery, kidnapping, and fraud). The paper provides a series of comparative statics exercises to assess the effects of changes in government efficiency, licit sector productivity, and illicit drug prices. From the model, the analysis derives a set of estimable macroeconometric equations to measure the size of laundered assets in the Colombian economy in the period 1985 to 2013. The paper assembles a data set whose key components are estimates of illicit income from drug trafficking and common crime. Illicit incomes increased drastically until 2001, reaching a peak of nearly 12 percent of gross domestic product and then decreasing to less than 2 percent by 2013. The decline overlaps not only in a period of high economic growth, but also after the implementation of Plan Colombia. The data set is used to estimate the volume of laundered assets in the economy by applying the Kalman filter for the estimation of unobserved dynamic variables onto the derived macroeconometric equations from the model. The findings show that the volume of laundered assets increased from about 8 percent of gross domestic product in the mid-1980s to a peak of 14 percent by 2002, and declined to 8 percent in 2013. Details: Washington, DC: World Bank, 2016. 66p. Source: Internet Resource: Policy Research Working Paper 7578: Accessed March 5, 2016 at: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2016/02/25/090224b0841b08b8/1_0/Rendered/PDF/Illicit0activi0lication0to0Colombia.pdf Year: 2016 Country: Colombia URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2016/02/25/090224b0841b08b8/1_0/Rendered/PDF/Illicit0activi0lication0to0Colombia.pdf Shelf Number: 138113 Keywords: Drug Trafficking Economics and Crime Financial Crimes Illicit Goods Money Laundering Proceeds of Crime |
Author: Wood, Helena Title: The Big Payback: Examining Changes in the Criminal Confiscation Orders Enforcement Landscape Summary: The UK legislation for removing the proceeds of crime from the hands of convicted criminals, governed by the Proceeds of Crime Act 2002 (POCA), is viewed as particularly punitive due to its ability to capture a wide pool of income and assets, some of which are not linked to the indictable offence. While this is desirable in policy terms, the broad framing of the law has created unintended consequences for those charged with enforcing the orders and the system has faced increasing criticism, most prominently in a 2013 report of the National Audit Office (NAO), regarding the disparity between the levels of orders made in the courts and the amounts eventually collected from the criminal. The NAO's report and some of the wider media coverage could be criticised for their focus on revenue-raising and 'value for money' rather than the impact on criminals, and for their failure to highlight the complexity of the law and the extent to which this (and not administrative failures) has led to the backlog of uncollected confiscation orders - currently L1.6 billion and rising. However the report did make a number of valid points, including on multi-agency co-ordination, and provided a catalyst for the government to recognise the centrality of the enforcement process to the success of the confiscation-orders regime as a whole. This paper examines the legislative and systemic changes to the confiscation-order enforcement process introduced by the government in 2014 and 2015, and examines the extent to which these offer the needed shift in priority towards enforcement to reduce the current backlog and to prevent a future build-up. The paper then makes recommendations for consideration by policy-makers. Details: London: Royal University Services Institute for Defence and Security Studies (RUSI), 2016. 34p. Source: Internet Resource: RUSI Occasional Paper, February 2016: Accessed March 14, 2016 at: https://rusi.org/sites/default/files/201602_op_the_big_payback.pdf Year: 2016 Country: United Kingdom URL: https://rusi.org/sites/default/files/201602_op_the_big_payback.pdf Shelf Number: 138223 Keywords: Asset ForfeitureConfiscation OrdersOrganized CrimesProceeds of Crime |
Author: Wood, Helena Title: Enforcing Criminal Confiscation Orders: From Policy to Practice Summary: The enforcement process for criminal confiscation orders operating under the Proceeds of Crime Act 2002 (POCA) has faced considerable criticism from both parliamentary and media commentators. The POCA was indeed a significant step forward and addressed the need to adopt effective measures to tackle the proceeds of criminal activity. However, the criminal-confiscation regime has a number of flaws, particularly in the practical challenges of enforcement. These were most prominently highlighted by the 2013 review conducted by the National Audit Office which led to calls for the development of a more effective system. The headlines make for stark reading: L1.6 billion in unenforced confiscation orders, an amount which is continuing to rise. This paper is structured around two key issues. First, it examines how the law has been framed and applied. It provides a detailed analysis of the process, shedding light on some of the weaknesses of the current legislative environment. In addressing the second issue - unenforced confiscation orders - the paper specifically examines the assets on which these orders are based. The paper's overall purpose is to assess the extent to which the law, rather than administrative failings, is the root cause of the large value of uncollected orders. In short, to what extent do real assets exist against which the authorities can take enforcement action? Details: London: London: Royal University Services Institute for Defence and Security Studies (RUSI), 2016. 26p. Source: Internet Resource: Occasional Paper: Accessed March 14, 2016 at: https://rusi.org/sites/default/files/201602_op_enforcing_criminal_confiscation_orders.pdf Year: 2016 Country: United Kingdom URL: https://rusi.org/sites/default/files/201602_op_enforcing_criminal_confiscation_orders.pdf Shelf Number: 138224 Keywords: Asset ForfeitureConfiscation OrdersOrganized CrimeProceeds of Crime |
Author: Great Britain. National Audit Office Title: Confiscation Orders: Progress Review Summary: government's administration of criminal confiscation orders has seen a greater focus on enforcing the orders, according to the NAO. Many of the fundamental weaknesses identified two years ago remain, however, and the system of managing confiscation orders has not been transformed. Confiscation orders are the main way through which the government carries out its policy to deprive criminals of the proceeds of their crimes. The spending watchdog reported on the administration of confiscation orders in December 2013, concluding that the process was not working well enough and did not provide value for money. The Committee of Public Accounts subsequently made six recommendations for the system's improvement, which were accepted by the government. Today's report found that the criminal justice bodies involved have made some progress against most of the Committee's recommendations. Despite this, the NAO considers that the only recommendation which has been fully addressed is that the sanctions for non-payment should be strengthened. The Home Office introduced new legislation which includes longer default prison sentences and powers for judges to impose travel bans for non-payers. It is too early to conclude, however, whether these changes will prove successful. Since 2014, the criminal justice bodies have improved how they administer confiscation orders, with greater focus on enforcement and better joint working across bodies including the Ministry of Justice and the Home Office. This has led to a $22 million (16%) increase in confiscated income in two years and the highest amount collected to date. The number of orders imposed, however, has fallen by 7% and are made in only a tiny fraction of total crimes. According to the NAO, more could be done to reduce confiscation order debt, which has risen by $158 million to $1.61 billion in the last two years. Much of the debt now relates to orders which are at least 5 years old and HM Courts & Tribunals Service assessed that only $203 million of this total debt can realistically be collected. There are, however, fewer financial investigators, which has reduced the capacity needed to help recover high-value orders, and the use of restraint orders to freeze an offender's assets has also fallen by 12%. Both are key to successful enforcement. There is also the potential for more collection, for example through greater involvement of the Foreign & Commonwealth Office to find and repatriate assets transferred overseas or changes in the law to stop criminals hiding illicit assets under other people's names. The Criminal Finances Improvement Plan, which set out 11 objectives covering the whole administrative process of managing confiscation orders, has helped galvanise efforts to improve the enforcement of orders since its launch in 2014. The government has not however met its ambitious targets for the plan's implementation. In addition, the plan does not set out agreed success measures nor make clear the priority of the government's objectives for confiscation. Competing priorities have also affected the push to increase the use of confiscation orders, as while the government aspires for law enforcement agencies to treat confiscation orders as a priority, most police forces do not consider asset recovery a priority compared to other areas of law enforcement, such as countering extremism. Details: London: NAO, 2016. 57p. Source: Internet Resource: HC: 886, 2015-16: Accessed March 16, 2016 at: https://www.nao.org.uk/wp-content/uploads/2016/03/Confiscation-orders-progress-review.pdf Year: 2016 Country: United Kingdom URL: https://www.nao.org.uk/wp-content/uploads/2016/03/Confiscation-orders-progress-review.pdf Shelf Number: 138254 Keywords: Asset ForfeitureConfiscation OrdersProceeds of Crime |
Author: Organisation for Economic Co-Operation and Development (OECD) Title: Tracking Anti-Corruption and Asset Recovery Commitments. A Progress Report and Recommendations for Action Summary: At the Third High Level Forum on Aid Effectiveness in Accra, Ghana in 2008, more than 1 700 participants from governments, aid agencies and civil society organizations came together to review progress on the Paris Declaration and to define the steps forward to further improve aid effectiveness. One result was the Accra Agenda for Action, in which donor countries committed themselves to fight corruption, in particular to "take steps in their own countries to combat corruption by individuals or corporations and to track, freeze, and recover illegally acquired assets." This declaration created momentum in the international fight against corruption, addressing a facet that had hitherto been largely neglected by the international development community, but which has important repercussions worldwide. Vast sums of financial assets are stolen from developing countries and hidden in financial centers around the world - money that could provide education, food or health services to the poor. Estimates reach into the hundreds of millions of dollars, and, although, there is some disagreement about these figures, it is clear that they probably exceed the level of official development assistance by a significant margin. Those stolen assets can be returned to their lawful owners and used for development programs, sending a clear message to corrupt political leaders that OECD countries are prepared to take action against corrupt practices at home. This publication reviews the compliance of 30 OECD donor countries with the anti-corruption commitments they made in Accra. It assesses progress in combating corruption and in tracking and recovering illegal assets to inform decision-makers of progress at the Fourth High Level Forum on Aid Effectiveness, which will be held in Busan in November 2011. The report shows that four countries - Australia, Switzerland, the United Kingdom and the United States - have repatriated a total of USD $ 227 million to foreign jurisdictions between 2006 and 2009, with another two countries - France and Luxembourg - having frozen assets pending a court decision. Assets frozen total slightly over USD $ 1.2 billion. The findings of the report highlight the need to develop a concrete follow-up action plan in Busan, as most countries have not yet taken sufficient steps to translate the commitments they made in Accra into policies generating concrete results. However, positive examples show that, with strong political leadership and institutional mechanisms in place, important results can be achieved in the fight against corruption and asset recovery. Details: OECD and the International Bank for Reconstruction and Development/The World Bank, 2011. 64p. Source: Internet Resource: Stolen Asset Recovery Initiative: Accessed March 30, 2016 at: https://star.worldbank.org/star/sites/star/files/Anti-corruption-and-Asset-Recovery-commitments-%28Accra%29.pdf Year: 2011 Country: International URL: https://star.worldbank.org/star/sites/star/files/Anti-corruption-and-Asset-Recovery-commitments-%28Accra%29.pdf Shelf Number: 138496 Keywords: Asset ForfeitureCorruptionFinancial CrimeProceeds of Crime |
Author: Europol Title: The THB Financial Business Model: assessing the current state of knowledge Summary: Europol's Report on Trafficking in Human Beings (THB) Financial Business Model 2015 is now available online. This document has been prepared by experts at Europol and is oriented towards explaining the current crime situation, providing an overview of all relevant factors e.g. organised crime groups (OCGs), criminal markets, and geographical dimension. The main key findings detailed in the report show how OCGs involved in THB tend to work independently from other groups and launder their own criminal proceeds with little use of experts. These OCGs are mainly small and based on family and ethnic ties. The family cell is used to support trafficking operations and money laundering activities. There are no new methods of money laundering specific to THB groups, but the exploitation of innovative technologies is increasing. Financial institutions, money service businesses and other types of financial providers are at most risk of being exploited by the money laundering activities of OCGs. Details: The Hague: Europol, 2015. 14p. Source: Internet Resource: Accessed April 13, 2016 at: https://www.europol.europa.eu/content/trafficking-human-beings-financial-business-model Year: 2015 Country: Europe URL: https://www.europol.europa.eu/content/trafficking-human-beings-financial-business-model Shelf Number: 138650 Keywords: Financial crimesHuman TraffickingMoney LaunderingOrganized CrimeProceeds of Crime |
Author: Cohen, Derek Title: Without Due Process of Law: The Conservative Case for Civil Asset Forfeiture Reform Summary: There is little dispute among the conservative movement that criminals who would threaten the safety of our communities deserve to be divested of the fruits of their illicit enterprise. Drug dealers should lose possession of vehicles used to facilitate offenses in addition to the criminal sanction they face. However, civil asset forfeiture-the practice of taking ownership of real or personal property allegedly connected to criminal activity but not requiring the criminal activity to be alleged, much less proven-has recently garnered significant outrage in the states. Tales of long-term abuses (such as those in Tenaha, Texas) and unconscionable takings (such as the entirety of Michigan grocer Terry Dehko's bank account containing over $35,000) have taken root in the public conscience as emblematic of what the state, given unchecked authority, is capable of (Cohen). This affront to central conservative ideals of property rights, due process, and rule of law has prompted several "red" states to enact comprehensive reforms, ranging from removing the incentives to engage in the practice to wholesale abolition. New Mexico, for example, has recently enacted a spate of reforms that essentially abolish civil asset forfeiture and equitable sharing, while remanding the proceeds of criminal forfeiture to a communal fund. Montana now requires a criminal conviction before assets can be forfeited and, in tandem, raised the threshold that the state must meet to perfect the forfeiture post-conviction. Even when states do pass individual protections such as raising the burden of proof or providing counsel in forfeiture proceedings, "equitable sharing" offers an easy mechanism to skirt these protections. While the majority of forfeitures are conducted under state law, local or state agencies may partner with the federal law enforcement agencies in enforcement efforts and select the least restrictive jurisdiction through which to process the forfeiture. North Carolina has long prohibited the practice, but unfortunately has been subject to above-average equitable sharing use. While commonsense conservative solutions to reform the practice have been attempted in nearly all states, efforts are stymied by special interests that directly benefit from forfeiture disbursements. These agencies have grown addicted to this unappropriated source of funding, with nearly 40 percent indicating that the money constitutes a necessary income source (Cohen). This paper highlights the two most comprehensive efforts to catalogue the relative ranking of the protections (or lack thereof) states provide their citizens, discusses commonly used fallacies by proponents of the status quo, and enumerates several reforms that states may implement to ensure criminals are held to account for their misdeeds while sparing the property rights of innocent property owners. Details: Austin, TX: Texas Public Policy Foundation, 2015. 8p. Source: Internet Resource: Policy Perspective: Accessed April 14, 2015 at: http://www.texaspolicy.com/library/doclib/PP-Without-Due-Process-of-Law-The-Conservative-Case-for-Civil-Asset-Forfeiture-Reform.pdf Year: 2015 Country: United States URL: http://www.texaspolicy.com/library/doclib/PP-Without-Due-Process-of-Law-The-Conservative-Case-for-Civil-Asset-Forfeiture-Reform.pdf Shelf Number: 138665 Keywords: Asset ForfeitureDue ProcessProceeds of Crime |
Author: Victorian Law Reform Commission Title: Use of Regulatory Regimes in Preventing the Infiltration of Organised Crime into Lawful Occupations and Industries - Consultation Paper Summary: Referral to the Commission 1.1 On 29 October 2014, the then Attorney-General, the Hon. Robert Clark, MP, asked the Victorian Law Reform Commission, under section 5(1)(a) of the Victorian Law Reform Commission Act 2000 (Vic), to review and report on the use of regulatory regimes to help prevent organised crime and criminal organisations entering into or operating through lawful occupations and industries. 1.2 Lawful occupations and industries may be used to enable or facilitate organised crime and to conceal or launder the proceeds of crime. In 2014, the Parliament of Victoria Law Reform, Drugs and Crime Prevention Committee recommended that the Victorian Government investigate the appropriateness of using administrative regulatory measures to reduce the opportunities available to organised crime groups for engaging in illegal activities in Victoria. 1.3 Regulatory regimes are the laws, regulations, policies and instruments that regulate particular occupations and industries; for example, laws that provide that only fit and proper people can obtain licences to operate in particular occupations or industries. Regulatory regimes may assist in preventing the infiltration of organised crime groups into lawful occupations and industries. 1.4 There are other legal responses to organised crime under Victorian and Commonwealth law which are, in general, not focused on specific occupations or industries. These include anti-association laws, anti-fortification laws, tools for the investigation and prosecution of criminal offences committed by organised crime groups, anti-money laundering laws, laws allowing for the forfeiture or confiscation of the proceeds of crime, and "unexplained wealth" laws. Scope of the review 1.5 The Commission's review is determined by the terms of reference. The terms of reference ask the Commission whether a framework of principles can be established for: - assessing the risks of organised crime infiltration of different lawful occupations or industries - developing suitable regulatory responses. 1.6 The Commission's report will present recommendations for these two sets of principles. In establishing these principles, the Commission has been asked to consider, among other matters: - the experience of Victoria and other jurisdictions in using occupational and industry regulation to help prevent organised crime infiltration of lawful occupations or industries - the implications for the overall efficiency and effectiveness of regulatory regimes of using such regimes to help prevent organised crime infiltration of lawful occupations or industries - the costs and benefits of regulatory options to assist in preventing organised crime infiltration of lawful occupations or industries. Details: Melbourne: The Commission, 2015. 88p. Source: Internet Resource: Accessed April 23, 2016 at: http://www.lawreform.vic.gov.au/sites/default/files/VLRC_Regulatory_Regimes_consultation_paper_%20for_web.pdf Year: 2015 Country: Australia URL: http://www.lawreform.vic.gov.au/sites/default/files/VLRC_Regulatory_Regimes_consultation_paper_%20for_web.pdf Shelf Number: 138790 Keywords: Asset ForfeitureMoney LaunderingOrganized CrimeProceeds of Crime |
Author: Council of Europe Title: White Paper on transnational organised crime Summary: Transnational organised crime (TOC) represents a major threat to global security. It threatens peace and human security, violates human rights and undermines the economic, social, cultural, political and civil development of societies worldwide. Because of its transnational character, TOC requires a targeted and comprehensive approach, including the swift application of international co-operation mechanisms. This white paper, drafted at the request of the Committee of Ministers, establishes five areas in which the Council of Europe could contribute to fighting TOC and identifies specific tasks that could be carried out better or more efficiently by the Organisation: 1. Problems related to police and judicial international co-operation, 2. The use of special investigative techniques, 3. The implementation of witness protection programmes and collaboration of state witnesses, 4. The need for increasing co-operation with administrative agencies and the private sector and 5. The essential need to target the proceeds of crime in order to discourage this type of crime and to improve the effectiveness of the fight against criminal organisations that operate in a transnational setting. With an innovative multidisciplinary approach and the choice to focus on improving the criminal response in a transnational setting, this White Paper is intended to become a helpful tool for policy makers and practitioners alike. Details: Paris: Council of Europe, 2015. 49p. Source: Internet Resource: Accessed October 26, 2016 at: https://edoc.coe.int/en/organised-crime/6837-white-paper-on-transnational-organised-crime.html Year: 2015 Country: Europe URL: https://edoc.coe.int/en/organised-crime/6837-white-paper-on-transnational-organised-crime.html Shelf Number: 140852 Keywords: Criminal Investigation Organized Crime Proceeds of crimeTransnational Organized Crime Witness Protection |
Author: Smith, Marcus Title: Procedural impediments to effective unexplained wealth legislation in Australia Summary: Australia’s unexplained wealth laws form part of a range of measures introduced in response to growing concern about the prevalence and impact of organised crime. The confiscation of criminal assets, including through the use of unexplained wealth legislation, seeks to undermine the business model of organised crime by removing its financial return, punishing offenders, compensating society, preventing the improper use of assets and deterring participation in crime (Bartels 2010a). The Australian Crime Commission has conservatively estimated that serious and organised crime cost Australia $36b in 2013–14 (ACC 2015). According to published national statistics, the total value of assets confiscated in Australian jurisdictions between 1995–96 and 2013–14 was approximately $800m, averaging around $44m annually. The discrepancy between these two amounts clearly shows more needs to be done to target the profits of organised crime. This paper reviews Australia’s current approaches to confiscating unexplained wealth and aims to identify any barriers to their implementation, to inform effective procedural reforms to the laws and better target the proceeds of crime of Australia’s most serious criminals. Details: Canberra: Australian Institute of Criminology, 2016. 9p. Source: Internet Resource: Trends & issues in crime and criminal justice, no. 523: Accessed December 5, 2016 at: http://aic.gov.au/media_library/publications/tandi_pdf/tandi523.pdf Year: 2016 Country: Australia URL: http://aic.gov.au/media_library/publications/tandi_pdf/tandi523.pdf Shelf Number: 140298 Keywords: Asset Forfeitures Financial CrimesOrganized CrimeProceeds of Crime |
Author: Kruisbergen, Edwin W. Title: Combating organized crime: A study on undercover policing and the follow-the-money strategy Summary: This thesis presents empirical evidence on two counterstrategies to organized crime in the Netherlands: the criminal justice approach and the financial approach. For the criminal justice approach, it focuses on a specific method of criminal investigation: undercover policing. For the financial approach, it looks into what organized crime offenders actually do with their money as well as the efforts of law enforcement agencies to confiscate criminal earnings. Index General introduction Undercover policing: assumptions and empirical evidence Infiltrating organized crime groups: theory, regulation and results of a last resort method of investigation Profitability, power, or proximity? Organized crime offenders investing their money in legal economy Explaining attrition: investigating and confiscating the profits of organized crime Conclusion and discussion Details: The Hague: WODC, Vrije Universiteit Amsterdam, 2017. 204p. Source: Internet Resource: Dissertation: Accessed January 25, 2017 at: https://www.wodc.nl/binaries/Kruisbergen_dissertation_full%20text_tcm28-237785.pdf Year: 2017 Country: Netherlands URL: https://www.wodc.nl/binaries/Kruisbergen_dissertation_full%20text_tcm28-237785.pdf Shelf Number: 147799 Keywords: Criminal InvestigationOrganized CrimeProceeds of CrimeUndercover Policing |
Author: Kowalczyk-Hoyer, Barbara Title: Top Secret: Countries Keep Financial Crime Fighting Data to Themselves Summary: Financial systems depend on trust from citizens and businesses to function. A vital part of this trust is the belief that banks are not holding funds on behalf of corrupt individuals and organisations, criminals, or terrorists. In recent years, the financial sector has provided ample reason to question this belief. The majority of large-scale corruption scandals, from Ukraine to Brazil, have featured banks transferring or managing funds for the perpetrators and their associates. An analysis of 200 cases of grand corruption by Global Witness has identified 140 banks involved in handling a total of at least US$56 billion in corrupt proceeds. Following the Petrobras corruption scandal in Brazil, for example, Switzerland’s attorney general froze US$400 million held at more than 30 Swiss banks with suspected ties to the case3 . Corruption and money laundering (ML) – the act of disguising the origin of illegal and corrupt proceeds – undermine the basic rule of law, weaken democratic institutions and damage economies and societies. In 2013 alone, developing countries lost an estimated US$ 1.1 trillion to Illicit Financial Flows – illegal movements of money from one country to another. Effective anti-money laundering measures, in both developed and developing countries, are essential to end these illicit flows. Experience in recent years has time and again shown that the financial sector cannot be relied upon to police itself when it comes to dirty money in the system, requiring strong consistent and effective anti-money laundering (AML) supervision by authorities. Just like health and safety inspectors in restaurants, national financial supervisors have the power to visit and inspect banks (on-site monitoring), identify and record failings in their systems, and impose sanctions where necessary. Prosecutors also have the power to investigate and prosecute money laundering cases, including requesting information across borders, and judges have the power to sanction individuals and corporate entities found guilty of crimes. Public scrutiny is essential for the accountability of these mechanisms, but this report shows that in countries hosting major financial centres, data on anti-money laundering prevention and enforcement is treated as if it were Top Secret. Just one in three basic anti-money laundering indicators drawn from internationally accepted guidelines is available to the public and up to date across 12 countries hosting major financial centres, including the U.S., the U.K., Germany, Switzerland and Luxembourg. This low level of public data availability is a major obstacle to any independent monitoring of the effectiveness of anti-money laundering by civil society and the media. Details: Berlin: Transparency International, 2017. 41p. Source: Internet Resource: Accessed February 22, 2017 at: https://financialtransparency.org/wp-content/uploads/2017/02/Top-Secret-financial-data-report.pdf Year: 2017 Country: International URL: https://financialtransparency.org/wp-content/uploads/2017/02/Top-Secret-financial-data-report.pdf Shelf Number: 144841 Keywords: Financial CrimesMoney LaunderingProceeds of Crime |
Author: Miller, Rena S. Title: Anti-Money Laundering: An Overview for Congress Summary: Anti-money laundering (AML) refers to efforts to prevent criminal exploitation of financial systems to conceal the location, ownership, source, nature, or control of illicit proceeds. Despite the existence of longstanding domestic regulatory and enforcement mechanisms, as well as international commitments and guidance on best practices, policymakers remain challenged to identify and address policy gaps and new laundering methods that criminals exploit. According to United Nations estimates recognized by the U.S. Department of the Treasury, criminals in the United States generate some $300 billion in illicit proceeds that might involve money laundering. Rough International Monetary Fund estimates also indicate that the global volume of money laundering could amount to as much as 2.7% of the world's gross domestic product, or $1.6 trillion annually. Money laundering is broadly recognized to have potentially significant economic and political consequences at both national and international levels. Despite robust AML efforts in the United States, the ability to counter money laundering effectively remains challenged by a variety of factors. These include: the scale of global money laundering; the diversity of illicit methods to move and store ill-gotten proceeds through the international financial system; the introduction of new and emerging threats (e.g., cyber-related financial crimes); the ongoing use of old methods (e.g., bulk cash smuggling); gaps in legal, regulatory, and enforcement regimes, including uneven availability of international training and technical assistance for AML purposes; and the costs associated with financial institution compliance with global AML guidance and national laws. AML Policy Framework In the United States, the legislative foundation for domestic AML originated in 1970 with the Bank Secrecy Act (BSA) of 1970 and its major component, the Currency and Foreign Transaction Reporting Act. Amendments to the BSA and related provisions in the 1980s and 1990s expanded AML policy tools available to combat crime, particularly drug trafficking, and prevent criminals from laundering their illicitly derived profits. Key elements to the BSA’s AML legal framework, which are codified in Titles 12 (Banks and Banking) and 31 (Money and Finance) of the U.S. Code, include requirements for customer identification, recordkeeping, reporting, and compliance programs intended to identify and prevent money laundering abuses. Substantive criminal statutes in Titles 31 and 18 (Crimes and Criminal Procedures) of the U.S. Code prohibit money laundering and related activities and establish civil penalties and forfeiture provisions. Moreover, federal authorities have applied administrative forfeiture, non-conviction based forfeiture, and criminal forfeiture tools. In response to the terrorist attacks on the U.S. homeland on September 11, 2001, Congress expanded the BSA's AML policy framework to incorporate additional provisions to combat the financing of terrorism (CFT). Although CFT is not the primary focus of this CRS report, post- 9/11 legislation provided the Executive Branch with greater authority and additional tools to counter the convergence of illicit threats, including the financial dimensions of organized crime, corruption, and terrorism. Policy Outlook for the 115th Congress Although CFT will likely remain a pressing national security concern for policymakers and Congress, some see the beginning of the 115th Congress as an opportunity to revisit the existing AML policy framework, assess its effectiveness, and propose regulatory and statutory changes. Such efforts could further address issues raised in hearings and proposed legislation during the 114th Congress, including beneficial ownership, the application of targeted financial sanctions, and barriers to international AML information sharing. Drawing from past legislative activity, the 115th Congress may also revisit proposals to require the Executive Branch to develop a roadmap for identifying key AML policy challenges and balancing AML priorities in a national strategy. Some observers have gone further to propose broader changes to the BSA/AML regime. The 115th Congress may also seek to address tensions that remain in balancing the policy objectives of improving financial services access and inclusion while also accounting for money laundering risks and vulnerabilities that may result in the exclusion (or "de-risking") of others from the international financial system. Details: Washington, DC: Congressional Research Service, 2017. 30p. Source: Internet Resource: CRS Report R44776: Accessed March 6, 2017 at: https://fas.org/sgp/crs/misc/R44776.pdf Year: 2017 Country: United States URL: https://fas.org/sgp/crs/misc/R44776.pdf Shelf Number: 145581 Keywords: Financial CrimesMoney LaunderingNational SecurityOrganized CrimeProceeds of CrimeTerrorist Financing |
Author: Australian National Audit Office Title: Proceeds of Crime: Australian Federal Police; Australian Financial Security Authority Attorney-General's Department Summary: The objective of this audit was to examine the effectiveness of the Australian Federal Police's, the Australian Financial Security Authority's and the Attorney-General's Department's administration of property and funds under the Proceeds of Crime Act 2002. Background 1. The Proceeds of Crime Act 2002 (the POCA) provides a scheme (the"POCA scheme") to trace, restrain and confiscate the proceeds of crimes against Commonwealth law. It seeks to disrupt, deter and reduce crime by undermining the profitability of criminal enterprises, depriving persons of the benefits derived from crime, and preventing reinvestment of the proceeds in further criminal activity. 2. The POCA also provides a scheme that allows for confiscated funds to be given back to the community in an endeavour to prevent and reduce the harmful effects of crime in Australia. This mechanism has provided funding to non-government and community organisations, local councils, as well as Commonwealth and state police forces and Commonwealth criminal intelligence entities. Audit objective and criteria 3. The audit objective was to assess whether the Australian Federal Police (AFP), Australian Financial Security Authority (AFSA) and the Attorney-General's Department (AGD) effectively carried out key operational and advisory functions related to property and proceeds under the Proceeds of Crime Act 2002. 4. To form a conclusion against the audit objective, the ANAO adopted the following high-level audit criteria: effective restraint is achieved by the AFP and/or AFSA through the timely implementation of appropriate court orders; AFSA administers restrained property in an efficient and economical manner and consistent with relevant court orders; AFSA disposes of forfeited property in an appropriate manner and transfers the net proceeds to the Confiscated Assets Account; AGD provides advice to the Minister for Justice on which proposals for funding from the Confiscated Assets Account represent the best value for money; and the AFP and AFSA report against benchmarked performance measures. Conclusion 5. The AFP, AFSA and AGD effectively carry out key operational and advisory functions related to property and proceeds under the Proceeds of Crime Act 2002. 6. Risk based planning procedures are in place for deciding which property should be restrained and what conditions should be placed on the property when seeking a restraining order. The manner in which restraining orders are implemented depends on the type of property under restraint. For the major classes of property, AFP and AFSA processes have worked well and custody and control of property has been achieved in a way that minimises the risk of the property being dissipated. 7. AFSA has appropriate custodial arrangements in place for all types of property. Legislative and administrative constraints currently limit the ability the of Official Trustee to achieve improved rates of return from the substantial amount of funds held in the restrained and forfeited monies bank accounts and the Confiscated Assets Account. AFSA also manages property in a way that is consistent with the relevant court orders and disposes of forfeited property in an appropriate manner in order to maximise the sale proceeds. 8. The AGD has established effective processes to identify the possible use of funds from the Confiscated Assets Account. It has also advised the Minister for Justice on proposals to assist in achieving value for money from expenditure. During the financial years 2010-11 to 2015-16, the main beneficiaries of funding have been Commonwealth law enforcement and criminal intelligence agencies. Significant funding has also been approved for non-government, community organisation and local council projects, with the New South Wales, Victorian and Queensland police forces also receiving funding. 9. The AFP publicly reports the estimated recovery value of property restrained each year. When combined with the Australian Crime Commission's (ACC's) public reporting of the estimated value of property confiscated each year, this illustrates the trends in the amount of criminal proceeds intercepted by the POCA scheme. AFSA also undertakes limited public reporting on its administration of property. This reporting does not include information on the costs of administering property under its custody and control, which is an important aspect of its overall performance in relation to the proceeds of crime. However, AFSA has made some improvements in its internal reporting capacity about the costs of managing property and is in the early stages of developing benchmarks for some aspects of these costs. Supporting findings Restraining property 10. Planning and decision-making procedures by the Criminal Assets Confiscation Taskforce investigators and litigators relating to restraint are risk-based. Where the AFP has judged that the risk of dissipation is high, restraining order applications include a provision for custody and control of the property to be granted to AFSA. 11. Restraining orders are implemented in a timely manner and in a way that minimises the risk of property being dissipated. However, the AFP could do more to register orders involving motor vehicles on the Personal Property Securities Register (PPSR) in a timely manner. Custody and disposal of property 12. Custodial arrangements for property that has been placed into the custody and control of AFSA vary depending on the type of property restrained. Testing demonstrates that appropriate custodial arrangements are in place for all types of property. Management of the funds held in the restrained and forfeited monies bank accounts and the Confiscated Assets Account reflect legislative and administrative constraints that limit the ability of the Official Trustee to achieve improved rates of return from the substantial amount of funds held in these accounts. 13. AFSA manages property in a way that is consistent with the relevant court orders. Where consent, variation and/or exclusion orders are granted by the court, AFSA has acted consistently with the court order. 14. In 2015-16, the disposal processes utilised by AFSA have achieved sale proceeds from forfeited property which have exceeded the estimated value of the property, as determined by an independent and/or certified valuer, in 76 per cent of matters, including all of the higher-value property. How funds from the Confiscated Assets Account are used 15. The processes through which the possible use of funds - stand-alone projects or grant programs-are identified and submitted for the Minister for Justice's approval have evolved over time. In recent years, more structured and targeted processes have been implemented in order to assist in achieving better overall outcomes from Confiscated Assets Account funding. The AGD provided the Minister with relevant advice to assist him in meeting his decision making obligations. 16. The main beneficiaries of funding from the Confiscated Assets Account have been Commonwealth criminal intelligence or law enforcement entities. Significant funds have been approved for non-government, community organisation and local council projects, mainly through the Safer Streets Programme. The New South Wales, Victorian and Queensland police forces have also received funding. Performance Monitoring and Reporting 17. The AFP publicly reports on the estimated recovery value of property restrained each year and whether the AFP has met the benchmark set for that year. It also internally monitors another key performance measure-the estimated value of property confiscated each year-which is publicly reported by the ACC. These two measures illustrate the trends in the criminal proceeds intercepted by the POCA scheme. In the context of a current AFP wide review of performance measures, additional metrics could be developed to provide better information both on the AFP's performance in litigating POCA cases and, in the longer term, the effect of the POCA scheme on the underlying criminal economy. 18. AFSA's public reporting on its administration of property under its custody and control is limited to high-level information. It is in the early stages of developing an improved internal reporting capacity to monitor the costs of managing property under AFSA custody and control. This work could be also be used to enable public reporting of the costs to administer such property, which is an important aspect of AFSA's overall performance and responsibilities under the POCA scheme. Details: Canberra: ANAO, 2017. 56p. Source: Internet Resource: ANAO Report No. 43 2016-17: Accessed April 6, 2017 at: https://www.anao.gov.au/sites/g/files/net2766/f/ANAO_Report_2016-2017https://www.anao.gov.au/sites/g/files/net2766/f/ANAO_Report_2016-2017_43_0.pdf_43_0.pdf Year: 2017 Country: Australia URL: Shelf Number: 144738 Keywords: Asset ForfeitureCriminal AssetsFinancial CrimesProceeds of Crime |
Author: Heywood, Max Title: Tainted Treasures: Money Laundering Risks in Luxury Markets Summary: From Ukraine to Tunisia and Brazil , large-scale cases of grand corruption in recent years have involved the acquisition of luxury property, vehicles and goods. This report examines the risk of luxury goods and assets being used to launder the proceeds of corruption, including in the art world and the marketplaces for super-yachts, precious stones and jewels, high-end apparel and accessories, and real estate. In theory, businesses operating in the luxury sector should be well placed to prevent money laundering, as they are highly aware of the reputational risks to their brands and often seek to establish long-term relationships with their customers, which should make it easy to carry out due diligence. However, the available data suggests that compliance by high-value retailers with due diligence and reporting obligations is remarkably low. For instance, across jurisdictions luxury sector suppliers seldom act on any concerns about possible money laundering by filing suspicious activity reports (SARs). Legislation and policy to prevent money laundering in the luxury sector also have weaknesses. Based on an assessment of existing sources such as regulatory reports and sector-specific studies, this scoping report finds that, while there is some variation across countries, current levels of oversight and enforcement by authorities are limited in leading luxury markets including China, France, Germany, Italy, Japan, the UK and the US. Several characteristics of the luxury sector itself indicate heightened risks of money laundering. Some high-value goods such as jewellery, precious stones, art and luxury accessories are easily transportable. Others, such as luxury real estate and super-yachts have been associated with the use of anonymous shell companies or intermediaries to purchase and manage these assets, which are significant red flags. To these risks are added the traditions of discretion and confidentiality, which are present across virtually all luxury sectors, and represent a major money laundering risk. From fixing the gaps in international standards and national legislation to increasing the number of suspicious reports being submitted to authorities by luxury sector businesses, much remains to be done to reduce the scope for individuals using the proceeds of corruption to acquire and enjoy high-value goods and property, and to use these assets as a vehicle for laundering their ill-gotten gains. Details: Berlin: Transparency International, 2017. 33p. Source: Internet Resource: Accessed April 17, 2017 at: https://financialtransparency.org/wp-content/uploads/2017/04/2017_TaintedTreasures_EN.pdf Year: 2017 Country: International URL: https://financialtransparency.org/wp-content/uploads/2017/04/2017_TaintedTreasures_EN.pdf Shelf Number: 144985 Keywords: Corruption Financial Crimes Money Laundering Proceeds of Crime |
Author: D'Angelo, Elena Title: Organized Crime and the Legal Economy: The Italian Case Summary: Italy's economy is one of the largest, not only in Europe but also with reference to the global context. Its financial and industrial sectors are significant. In addition, domestic organized crime groups, especially the Camorra, the 'Ndrangheta, and the Cosa Nostra, operate across numerous economic sectors, both in Italy and abroad, and their illicit proceeds represent the main source of laundered funds. Illicit markets remain the main source of profit for organized crime groups in Italy, and more broadly in Europe. There have been various attempts to estimate the total revenue of organized crime in Italy. For example, the U.S. Department of State (2015) estimated Italy's black market to be to 12.4% of the country's GDP, approximately $250 billion. The Italian Parliament's Antimafia Commission estimated that the total turnover of endogenous organized crime in Italy valued at L150 billion in 2012. However, the border between illegal and legal activities of organized crime is hard to define. Financial as well as human resources are increasingly being circulated from one sector to the other, without interruption. While maintaining their interests in traditional fields of action related to illicit trade, organized crime groups have been expanding their presence and influence into the legal economy - creating threats to society on an array of levels. Research Questions Two main research questions (RQs) guide the present study: 1. How does organized crime infiltrate the legal economy? 2. What is the impact of organized crime infiltration in the legal economy? The qualitative section of the report answers the first RQ, further detailed in the following subquestions: 1. What are the main reasons behind the diversification of investments into the legal sector? 2. Which is organized crime's modus operandi? 3. How does organized crime exploit existing vulnerabilities and what are the facilitating factors? Details: Torino, Italy: United Nations Interregional Crime and Justice Research Institute (UNICRI), 2016. 111p. Source: Internet Resource: Accessed May 3, 2017 at: http://files.unicri.it/UNICRI_Organized_Crime_and_Legal_Economy_report.pdf Year: 2016 Country: Italy URL: http://files.unicri.it/UNICRI_Organized_Crime_and_Legal_Economy_report.pdf Shelf Number: 145251 Keywords: Illegal Markets Illicit TradeMoney LaunderingOrganized CrimeProceeds of Crime |
Author: U.S. Government Accountability Office Title: Anti-Money Laundering: U.S. Efforts to Combat Narcotics-Related Money Laundering in the Western Hemisphere Summary: Proceeds from narcotics-related illicit activities are one of the most common sources of money laundering in the United States. Though difficult to accurately determine, in 2015, Treasury estimated that drug trafficking generated about $64 billion annually from U.S. sales. Moreover, the Western Hemisphere accounts for about a third of the jurisdictions designated by State as of primary concern for money laundering. GAO was asked to provide information on U.S. efforts to impede illicit proceeds from drug trafficking from entering the financial systems of the United States and other Western Hemisphere countries. This report describes (1) U.S. agency oversight and monitoring of compliance with the BSA, including collaboration with counterparts in other Western Hemisphere countries, and (2) State's and Treasury's efforts to build capacity in other Western Hemisphere countries to combat narcotics-related money laundering. GAO reviewed laws and regulations; interviewed experts and U.S. officials; reviewed documents and examined State's and Treasury's budget data for fiscal years 2011 through 2015, the most recent at the time of the review, for anti-money laundering activities. GAO selected Colombia, Mexico, and Panama - three principal recipients of AML support - for site visits, in part, because each country was designated a major drug transit or illicit drug-producing country from fiscal years 2014 through 2016. Details: Washington, DC: GAO, 2017. 67p. Source: Internet Resource: GAO-17-684: Accessed September 11, 2017 at: http://www.gao.gov/assets/690/686727.pdf Year: 2017 Country: United States URL: http://www.gao.gov/assets/690/686727.pdf Shelf Number: 147217 Keywords: Anti-Money LaunderingDrug TraffickingFinancial CrimeMoney LaunderingProceeds of Crime |
Author: Schneider, Friedrich Title: Restricting or Abolishing Cash: An Effective Instrument for Fighting the Shadow Economy, Crime and Terrorism? Summary: This paper has four goals: First, the use of cash as a possible driving factor of the shadow economy is investigated. Second, the use of cash in crime, here especially in corruption, is also econometrically investigated. The influence is somewhat larger than on the shadow economy, but it is certainly not a decisive factor for bribery activities. Some figures about organized crime are also shown; the importance of cash is diminishing. Third, some remarks about terrorism are made and here a cash limit doesn't prevent terrorism. Fourth, some remarks are made about the restriction or abolishment of cash on civil liberties, with the result that this will extremely limit them. The conclusion of this paper is that cash has a minor influence on the shadow economy, crime and terrorism, but potentially a major influence on civil liberties. Details: Paper presented at International Cash Conference 2017 - War on Cash: Is there a Future for Cash? 25 - 27 April 2017, Island of Mainau, Germany. 39p. Source: Internet Resource: Accessed September 13, 2017 at: https://www.econstor.eu/bitstream/10419/162914/1/Schneider.pdf Year: 2017 Country: International URL: https://www.econstor.eu/bitstream/10419/162914/1/Schneider.pdf Shelf Number: 147226 Keywords: BriberyCivil LibertiesCorruptionFinancial CrimesMoney LaunderingOrganized CrimeProceeds of CrimeShadow EconomyTerrorist Financing |
Author: Snead, Jason Title: An Overview of Recent State-Level Forfeiture Reforms Summary: Civil asset forfeiture laws allow for the seizure of property suspected of having been involved in, or derived from, criminal activity. In most states and at the federal level, no criminal charges or convictions are necessary because the resulting civil proceeding targets theproperty - not its owner. Civil forfeiture laws grant individuals challenging forfeiture cases considerably fewer legal protections than they would enjoy if they were defendants in criminal cases, and allow the law enforcement agencies that execute the seizures to retain the proceeds of successful forfeitures, creating a significant incentive to seize property. For decades, states have expanded the scope and reach of civil forfeiture, but within the past few years-driven by a growing number of accounts of abusive forfeitures and a recognition of the power of the forfeiture funding mechanism to distort the priorities of law enforcement organizations - many have reevaluated their civil forfeiture laws, scaling back or totally abolishing the tool. The message is clear: outside the law enforcement community, there is little support for the forfeiture status quo. Details: Washington, DC: Heritage Foundation, 2016. 9p. Source: Internet Resource: Backgrounder: Accessed September 18, 2017 at: http://www.heritage.org/crime-and-justice/report/overview-recent-state-level-forfeiture-reforms Year: 2017 Country: United States URL: http://www.heritage.org/crime-and-justice/report/overview-recent-state-level-forfeiture-reforms Shelf Number: 147382 Keywords: Asset ForfeitureFinancial CrimeProceeds of Crime |
Author: Wood, Helena Title: Every Transaction Leaves a Trace: The Role of Financial Investigation in Serious and Organised Crime Policing Summary: THE INTERNATIONAL DRUG trafficker buying a plane ticket to Spain to arrange shipment of his next consignment; the people trafficker leasing a property to use as a safe house to keep his victims; the cyber fraudster purchasing computer equipment with which to commit his crimes. What do all these disparate activities have in common? They leave an indelible financial footprint. And it is this footprint which creates a vulnerability ripe for exploitation by law enforcement, through financial investigation. Whether as a means of gathering valuable building-block financial intelligence, supporting a strong evidential case for prosecution, or a tool for predicting future activity and movements, this paper makes the case for the wider use of financial investigation techniques in the fight against serious and organised crime. Currently, both the scope and value of these techniques is frequently misunderstood and underestimated by being assigned solely as a tool for tackling 'financial crimes' (such as money laundering, fraud and corruption) or as a route to asset recovery, while undervaluing their role in the broader policing response to serious and organised crime more generally. The government's Serious and Organised Crime Strategy (SOC Strategy), published in October 2013, aimed at countering a 'Tier Two' national security threat, also fell into this trap. Although the strategy should be given credit for committing to '[a]ttack criminal finances by making it harder to move, hide and use the proceeds of crime', it did not explicitly make the intellectual leap to seeing financial investigation as an integral investigative tool in the fight against serious and organised crime. It was, in fact, a retrograde step from its 2011 predecessor, Local to Global: Reducing the Risk from Organised Crime, which had committed to 'mainstreaming' financial investigation into organised crime policing. In short, the new strategy was a clear demonstration of the miscomprehension of the role of financial investigation and a missed opportunity to drive the discipline forward. In light of this lack of a clear policy commitment, this paper seeks to examine the current state of play regarding the use of financial investigation tools in the fight against serious and organised crime at the local and regional policing levels, setting this against wider factors in the policing landscape. This lack of direction is ill-timed, given the intense budgetary pressures within policing at a time when the service is being asked to respond to a growing array of strategic risks. This wider landscape leaves the future of the discipline at a precipice. While pockets of progress have been made to cement the use of financial investigation as a mainstream tool in some areas of policing, this is largely dependent on the vision of certain key individuals and not part of a systemic plan. In many forces and law enforcement units, the discipline remains culturally marginalised and housed within an Economic Crime Unit rather than badged as a tool for use in the broader policing response. In others, budgetary cuts are reversing previous gains. In sum, the discipline is at risk again, as before, of being seen as 'nice to do', rather than part of core policing. The remedies to this issue are multifaceted. However, this paper makes the case for implementing key measures to ensure that wider budgetary and political factors do not push the discipline into decline. At a local policing level, there is a case for financial investigation being explicitly referenced in The Strategic Policing Requirement (SPR) set by the Home Secretary. It is also crucial that the strategic communications efforts by the Treasury- and Home Office-chaired cross-government Criminal Finances Board (CFB) reach out more effectively to police and crime commissioners. Details: London: Royal United Services Institute for Defence and Security Studies (RUSI), 2017. 45p. Source: Internet Resource: Occasional Paper: Accessed September 20, 2017 at: https://rusi.org/sites/default/files/201709_rusi_everytransactionleavesatrace_wood_web.pdf Year: 2017 Country: United Kingdom URL: https://rusi.org/sites/default/files/201709_rusi_everytransactionleavesatrace_wood_web.pdf Shelf Number: 147421 Keywords: Criminal Investigation Financial Crime Financial Investigation Fraud and Corruption Organized Crime Policing Proceeds of CrimeSerious Crimes |
Author: Barone, Raffaella Title: Drug Trafficking, Money Laundering and the Business Cycle: Does Secular Stagnation Include Crime? Summary: The aim of the paper is to analyze theoretically and empirically the impact the macroeconomic cycle has on the accumulation of capital by organized crime, using estimates for the global drug market. So far the economic literature has neglected the relationships existing between illegal markets, money laundering, and the business cycle. We propose a dynamic model where the business cycle influences the criminal economy via two different channels. On the one side, illegal markets grow at variable rates, depending on the health of the legal economy. Secondly, a pass-through effect can exist, since the business cycle affects the legal markets which criminal operators use to launder their revenues. Furthermore, we analyze the consequences of a "saturation effect" limiting maximum accumulation of illegal capital. We find that overall illegal capital is affected by the business cycle through a capital multiplier; in addition to this, the dynamics of interest rates in financial markets can influence such multiplier. Details: Milan, Italy: BAFFI CAREFIN Centre, Bocconi University, 2017. 20p. Source: Internet Resource: BAFFI CAREFIN Centre Research Paper No. 2017-47: Accessed November 8, 2017 at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2896012## Year: 2017 Country: Italy URL: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2896012## Shelf Number: 148074 Keywords: Illegal Markets Money Laundering Organized Crime Proceeds of crime |
Author: Financial Action Task Force Title: Money Laundering Through the Physical Transportation of Cash Summary: Despite the increasing prevalence of non-cash payment methods in developed economies, cash remains an important means of settlement across the globe, with an estimated USD 4 trillion in circulation and between 46% and 82% of all transactions in all countries being conducted in cash. Similarly, cash is still widely used in the criminal economy and it remains the raw material of most criminal activity. In many cases, even when the proceeds of a crime are initially generated in electronic form (such as the theft of funds from a bank account), criminals choose to withdraw the funds from a bank account in cash, transport it to another country, and pay it into another account in order to break an audit trail. The physical transportation of cash across an international border is one of the oldest and most basic forms of money laundering, but this report shows that it is still widespread today. There are no fully reliable estimates for the amount of cash laundered in this way, but the figure would seem to be between hundreds of billions and a trillion US dollars per year. The majority of countries surveyed during the compilation of this report were of the opinion that cash smuggling is an increasing problem. Physical transportation of cash as a method of money laundering is not restricted to a particular type of crime. Although many jurisdictions report the use of this typology by drug trafficking organisations, it is also linked to the illegal trafficking of other commodities, such as alcohol and tobacco, and it is also used widely by criminals involved in other activity including tax fraud, weapons and arms smuggling, organised immigration crime and the financing of terrorism. There are no cash smuggling methods more associated to one form of criminality than another, and no guarantee that criminals committing the same type of crime will move their proceeds in the same way and by the same route. Instead, the methods used to physically transport criminal cash are dependent on a decision making process undertaken by the criminal. This process begins with the criminal deciding what the purpose of the cash movement is (for example, to break the audit trail, to pay a supplier, to bank it in another jurisdiction etc.). This will dictate the ultimate destination, which will in turn inform the method used, and ultimately the route chosen. At all stages, influences such as risk, familiarity, simplicity and the demands of partners will affect the decisions made. Understanding the decision making process can assist in developing control techniques by authorities tasked with combatting the problem. Once the cash has been moved to its destination and used for its intended purpose it will eventually enter the legitimate financial system and will be recycled by banks and other financial institutions. Countries that use their own unique currency have the opportunity to monitor the repatriation of their currency from overseas, and while this is by no means straightforward, proper analysis can in some cases identify high risk routes, money laundering networks and drive national programs to raise awareness of risk. Details: Paris: FATF/OECD and MENAFATF, 2016. 108p. Source: Internet Resource: Accessed November 18, 2017 at: http://www.fatf-gafi.org/media/fatf/documents/reports/money-laundering-through-transportation-cash.pdf Year: 2015 Country: International URL: http://www.fatf-gafi.org/media/fatf/documents/reports/money-laundering-through-transportation-cash.pdf Shelf Number: 148162 Keywords: Financial Crimes Money Laundering Proceeds of CrimeTerrorist Financing |
Author: Inter-Governmental Action Group Against Money Laundering in West Africa (GIABA) Title: Typologies Report on Cash Transactions and Cash Couriers in West Africa Summary: The geographical territory of West Africa is occupied by fifteen countries that make up the Economic Community of West African States (ECOWAS): Benin, Burkina Faso, Cape Verde, Cote D'Ivoire, (The) Gambia, Ghana, Guinea, Guinea Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo. Of these fifteen (15) countries, eight (8)belong to a common currency zone known as the Union Economique Monetaire de l'Afrique de l Ouest (UEMOA), which has common monetary regulations. The economy of the West Africa region is largely cash-based, characterised by a large and growing unregulated informal sector which is vulnerable to money laundering and terrorist financing. Money Laundering (ML) is a process whereby the origin and ownership of funds generated by illegal means is concealed. The process of ML usually involves three stages: (1) the introduction of the proceeds of crime into the financial system (placement); (2) transactions to convert or transfer the funds to other locations or financial institutions (layering); and, (3) reintegrating the funds into the legitimate economy as "clean" money and investing it in various assets or business ventures. Terrorist financing (TF), on the other hand, is the direct or indirect financial support provided to criminals for the purpose of carrying out acts that involve violence and or intimidation of populations. Such funds could be derived from either legitimate or illegitimate sources. Although there are factual differences between money laundering (ML) and terrorist financing (TF), both processes may use common intermediaries such as cash transactions. Indeed, money laundering and terrorist financing are a threat to international peace and security. Nature and Types of Cash Transactions Cash transactions are a particular problem, especially in developing economies where the formal payment systems are inadequate or where the populace has little confidence in their use. Even in some developed economies, cash transactions constitute a specific money laundering and terrorist financing problem. For example, about 52% of case files transmitted to prosecutorial authorities by the Belgian Financial Intelligence Unit (FIU) in 2005 featured cash transactions. The types and patterns of cash transactions that are at risk of money laundering and terrorist financing include the following : - exchange transactions, involving the exchange of one currency into another or the conversion of smaller denominations into bigger ones; - money remittance transactions, within or outside the country, often for mutual settlement. One of the potential risks here is that false identities may be used, thus making regulation, even where it does exist, difficult; - cash deposits on bank accounts, either by the account owners or by a third party; - cash withdrawals from accounts; and - cross-border transport of physical cash concealed in items such vehicle spare parts, pockets, commercial airlines parcels, suitcases and handbags. Details: s.l.: GIABA, 2007. 36p. Source: Internet Resource: Accessed December 1, 2017 at: http://www.giaba.org/media/f/107_typologies-report-november-2007.pdf Year: 2007 Country: Africa URL: http://www.giaba.org/media/f/107_typologies-report-november-2007.pdf Shelf Number: 148672 Keywords: Cash TransactionsMoney LaunderingProceeds of CrimeTerrorist Financing |
Author: Hunter, Marcena Title: Measures that Miss the Mark: Capturing proceeds of crime in illicit financial flows models Summary: Illicit financial flows (IFFs) are generally viewed as the financial side of criminal activity, and there is widespread agreement IFFs are a global threat. There is also agreement that IFFs, particularly prevalent and damaging in the context of weak, developing and fragile states, are a threat to sustainable development. International recognition of IFFs as a development threat include Sustainable Development Goals (SDGs) target 16.4, which states: "[b]y 2030, significantly reduce illicit financial flow". However, the concept remains vague and its content controversial. Furthermore, misalignment between terminology used to define IFFs and methodology to measure the scale of IFFs has troubling implications for policy response. Terminology encompasses a wide variety of illicit flows, while existing measures tend to be narrower and inherently give greater weight to IFFs linked to the classifications of commerce, as compared to those generated by crime and corruption. Furthermore, IFFs from the least developed states are at high risk of being undervalued. This paper examines how terminology and measurement frameworks can better reflect the form and scale of IFFs linked to crime.Due to the complex nature of the phenomenon, a more accurate and multifaceted approach to defining and measuring crime-related IFFs is critical to better reflect the detrimental impact these types of flows have on development and to formulating effective responses. Continuing to treat IFFs as a single, indivisible phenomenon inhibits the development of comprehensive and effective responses. Disaggregation of analysis and measures of IFF types is therefore essential.Key recommendations: Develop more accurate terminology and definitions, including better accounting for elements especially relevant to developing nations and crime IFFs; Represent estimates of IFFs more accurately and transparently; Adopt a multi-step model that makes use of both crime- and country-specific assessments and the gravity model, as well as information from both quantitative and qualitative sources; and, Utilize assessment frameworks that go beyond monetary values and account for harm. Details: Geneva: Global Initiative against Transnational Organized Crime, 2018. 39p. Source: Internet Resource: Accessed June 29, 2018 at: http://globalinitiative.net/wp-content/uploads/2018/06/TGIATOC-Illicit-Financial-Flows-report-1941-hi-res-2-1.pdf Year: 2018 Country: International URL: http://globalinitiative.net/wp-content/uploads/2018/06/TGIATOC-Illicit-Financial-Flows-report-1941-hi-res-2-1.pdf Shelf Number: 150735 Keywords: Financial CrimesMoney LaunderingOrganized CrimeProceeds of Crime |
Author: Neumann, Vanessa Title: The many criminal heads of the Golden Hydra: How the Tri-Border Area's Interlocking Arcs of Crime Create LatAm's #1 International Fusion Center Summary: The Tri-Border Area ('TBA') that straddles the intersection of Argentina, Paraguay and Brazil is considered the 'Golden Hydra,' as it is the lucrative regional entry point of many 'heads' of transnational criminal organizations (TCOs) and foreign terrorist organizations (FTOs) that all lead to the underworld of illicit trade for more than forty years. This is partly a consequence of its ethnic composition and open borders, set by a policy to facilitate immigration from the Middle East, and also the connecting infrastructure to facilitate cross-border trade. The TBA gained notoriety in the 1990s after the bombings of the Israeli embassy (1992) and the AMIA center (1994), both in Buenos Aires, by Lebanese Hezbollah militants. The money, operatives and bomb parts all moved through the TBA. After 9/11, it again became the target of US counter-terrorism surveillance, as a 'safe haven' for terrorists from groups like Al Qaeda and Hamas, in addition to Hezbollah. With the world's attention firmly focused on the Middle East since then, the TBA has grown into a mini-state that benefits a corrupt elite while maintaining a large and efficient money laundering center for the world's organized crime and terrorist groups, not just in the region, but throughout the world, yielding TCOs and FTOs an estimated US$ 43 billion a year. Illicit trade of all sorts (including the illicit trade in tobacco products, 'ITTP') has been growing rapidly in recent years, corrupting good governance in all three countries and exploiting the degrading security and economic situation in both Argentina and Brazil. The TBA has become a regional crime fusion center where corrupt politicians work with drug cartels from Bolivia, Colombia, Mexico and Brazil, as well as organized crime groups from China, in conjunction with a large Lebanese merchant community, part of which gives support to Hezbollah. Though illicit funding for Hezbollah is generally high on the US agenda, that is not the case for the countries of the TBA. For historical reasons, Hezbollah is on the political agenda of Argentina. Brazil, however, does not consider Hezbollah a terrorist group; it considers only three groups as terrorists: the Taliban, Al Qaeda and ISIS. Paraguay considers Lebanese Hezbollah a group that poses a problem for its neighbors Argentina and Brazil, but not for Paraguay. authorities and mandates, Paraguay is constitutionally structured for corruption and illicit trade. Despite its smaller population and economy, it is the source and economic driver of illicit trade and money laundering affecting the other two countries. At the heart is Paraguay's lame-duck president, Horacio Cartes, the architect of the region's ITTP; he is the owner of Tabesa tobacco company. Furthermore, the removal of Carts from the presidency and its assumption by his successor (and fellow party member) Mario Abdo Benitez , will not reduce this illicit trade: Cartes will continue to wield tremendous power as a senator; several of his close friends will also enter the Senate, and his party won the presidency in the April 2018 elections. Security is the highest-ranked agenda item in Brazil's upcoming presidential elections in October 2018. This is primarily because of the military operations in Rio's favelas, where the criminal group Comando Vermelho (CV) and its affiliates are so widespread and heavily-armed, they are challenging the state for supremacy. The CV is enabled and funded by drugs and weapons that come mainly from Paraguay. This growing illicit trade has also turned Brazil into a prime export point for narcotics from South America to North America, Europe, Asia and Africa. Because of the complexity of the TBA's organized crime cluster, as well as the weakness of regional counter-terrorist protocols, we recommend engaging international authorities with regional mandates over the core crimes of corruption, money laundering, and proceeds of crime, with the aim of dismantling the source from the fusion centre. These authorities include: the IMF, UNODC, UN CTED, and FATF. Given that the US is largely absent from the region, it is recommended to open pathways to the US and European enforcement communities and the aforementioned authorities through well-structured workshops in Washington, DC and other key cities to build awareness. The other way to influence regional ITTP is to become a larger stakeholder in the Paraguayan tobacco industry. Details: New York: Counter Terrorism Project, 2018. 119p. Source: Internet Resource: Accessed Dec. 12, 2018 at: https://www.counterextremism.com/sites/default/files/The%20Many%20Criminal%20Heads%20of%20the%20Golden%20Hydra%20%28May%202018%29.pdf Year: 2018 Country: South America URL: https://www.counterextremism.com/sites/default/files/The%20Many%20Criminal%20Heads%20of%20the%20Golden%20Hydra%20%28May%202018%29.pdf Shelf Number: 154457 Keywords: Illicit TobaccoIllicit TradeMoney LaunderingOrganized CrimeProceeds of CrimeSmugglingTerroristsTobacco |