London summit will improve global tax transparency

2016 ◽  
Keyword(s):  
Political Commitment ◽  
Slow Process ◽  
Political Leaders ◽  
Financial Flows ◽  
Content Type ◽  
Beneficial Ownership ◽  
Illicit Financial Flows ◽  
High Level ◽  
New Instruments

Subject Anti-corruption summit outcome. Significance New transparency initiatives at the anti-corruption summit promise to inhibit illicit financial flows. The summit has given political momentum to the traditionally bureaucratic and slow process of implementing anti-corruption conventions, together with creating new instruments. Impacts Transparency over beneficial ownership will make it harder for individuals to avoid tax and will increase scrutiny over financial flows. Nevertheless, corrupt elites and criminal gangs will still have numerous routes through which to channel their money. High-level political commitment to fight corruption will provide a benchmark against which political leaders can be held to account.

Illicit money flows pose Africa development dilemma

2015 ◽  
Keyword(s):  
African Union ◽  
Financial Flows ◽  
Content Type ◽  
Macroeconomic Fundamentals ◽  
Money Flows ◽  
Commodity Export ◽  
Illicit Financial Flows ◽  
Sub Saharan ◽  
High Level ◽  
Effective Use

Subject Illicit money flows from Africa. Significance Illicit financial flows (IFFs) could cost sub-Saharan African (SSA) states up to 50 billion dollars per year in lost revenues, according to a high-level UN panel. The new report, commissioned by the African Union and SSA finance ministers, highlights the detrimental development consequences of IFFs -- in a context where many states are battling with declining commodity export revenues and rising debt burdens. Impacts In SSA states with weak macroeconomic fundamentals and rising debt servicing costs will exacerbate fiscal losses caused by IFFs. Nevertheless, the attractiveness of bond issuances as a form of cheap capital (with minimal conditions) means further issuances are likely. Yet buyers of SSA paper are likely to become more discerning, making it harder for issuers to borrow on favourable terms. Efforts to curtail poaching will be assisted by drone technology in Southern Africa, but their effective use risks community-level blowback.

Illicit financial flows: HSBC case study

2018 ◽  
Vol 21 (2) ◽  
pp. 231-246 ◽  
Author(s):  
Mohammed Ahmad Naheem
Keyword(s):  
Money Laundering ◽  
Financial Services ◽  
Banking Sector ◽  
Financial Flows ◽  
Content Type ◽  
Services Sector ◽  
Financial Services Sector ◽  
Beneficial Ownership ◽  
Illicit Financial Flows ◽  
The Impact

Purpose This paper provides examples of how illicit financial flows (IFFs) are occurring through the formal banking and financial services sector. The purpose of this paper is to explore which elements of anti-money laundering (AML) compliance need to be addressed to strengthen the banking response and reduce the impact of IFFs within the banking sector. Design/methodology/approach The paper uses a number of sources of secondary data including the Swiss leaks data for HSBC and also the Permanent Sub Committee Report on HBUS in the USA, the OECD report on money laundering compliance and Financial Action Task Force (FATF) guidelines on beneficial ownership. It links this information to the relevant IFF reports produced through Global Financial Integrity to highlight the connection between banking AML compliance and IFF transfers through the banking sector. Findings The main findings from the analysis are that banks have a greater legal responsibility towards detecting and reporting suspicious transactions than they would have previously considered. This includes identifying the source and purpose of fund transfers and establishing the beneficial ownership of recipients. Research limitations/implications The research topic is new; therefore, analysis papers and other academic writing on this topic are limited. Practical implications The research paper has identified a number of implications to the banking sector on addressing AML deficiencies, especially the need to improve standards of beneficial ownership verification and customer due diligence (CDD) checks for politically exposed persons. Social implications This paper has implications for the international development and the global banking sector. It will also influence approaches to AML regulation, risk assessment and audit within the broader financial services sector. Originality/value The originality of this paper is the link between the HSBC cases and IFFs and the implications this will have for future AML compliance processes across the banking sector.

Strategies for preventing illicit financial flows in developing countries

2020 ◽  
Vol 23 (3) ◽  
pp. 601-608
Author(s):  
Bello Umar ◽  
Martins Mustapha Abu ◽  
Zayyanu Mohammed
Keyword(s):  
Developing Countries ◽  
Task Force ◽  
Journal Articles ◽  
Financial Flows ◽  
Content Type ◽  
Effective Strategies ◽  
Beneficial Ownership ◽  
Assessment Techniques ◽  
Illicit Financial Flows ◽  
Financing Of Terrorism

Purpose This paper aims to critically review the strategies for prevention of illicit financial flows to and from developing countries with a view of ascertaining the most effective strategies to be selected and implemented by developing countries to stem the scourge. Design/methodology/approach The peer-reviewed journal articles were studied; those that discussed illicit financial flows were selected and reviewed critically using the systematic quantitative assessment techniques together with an output table. Findings The critical review deduced that enacting effective trade laws, trade regulations, creating a beneficial ownership registry, multinational companies disclosing information on business, automatic exchange of information on tax issues, the Financial Action Task Force 40 guidelines on anti-money laundering and countering financing of terrorism and domestic and international cooperation are the most reliable strategies that should be implemented by developing countries. Research limitations/implications The wide geographic scope of developing countries, use of only high-quality databases that restricted the use of other articles and use of public sector perspective are the limitations for this paper. Originality/value This study is amongst the limited works to discuss the most reliable and effective strategies to prevent illicit financial flows in developing countries.

scholarly journals Global e-government development: besides the relative wealth of countries, do policies matter?

2020 ◽  
Vol 14 (3) ◽  
pp. 381-400 ◽  
Author(s):  
Gonçalo Paiva Dias
Keyword(s):  
Low Income ◽  
Public Policies ◽  
Low Income Countries ◽  
Political Commitment ◽  
Content Type ◽  
Secondary Sources ◽  
Relative Wealth ◽  
Innovative Thinking ◽  
High Level ◽  
Government Development

Purpose This study aims to investigate whether, discounting the effect of the relative wealth of countries, it is possible to observe the relevance of policies for e-government development. Design/methodology/approach The deviations of countries' results from what could be expected, considering their relative wealth is calculated by using the residuals of a linear regression using the Gross Domestic Product per capita as the independent variable and the UN E-Government Development Index as the dependent variable. The countries that achieve better and worse results than expected are then identified and their cases are analyzed by resorting to secondary sources, namely, published research referring to their cases. Those research documents were identified by successively searching the Scopus database, the Google Scholar database and the Web of Science. Findings The existence of formal e-government strategies and plans and the capacity to implement them can make a difference, allowing countries to achieve better results than expected or, in their absence, to perform worse than expected. Research limitations/implications The proposed methodology can be useful to e-government researchers, particularly as a basis for deeper and more detailed studies. Practical implications Countries should invest in well-developed and focused strategies and continuity of public policies and their capacity to deliver results. For that purpose, political commitment and high-level coordination are key factors. For low-income countries, long-lasting cooperation with external experienced partners is crucial. For high-income countries, innovative thinking is a key enabler. Originality/value This study uses an innovative method to look beyond the effect of the relative wealth of countries and investigate the relevance of public policies for e-government development.

Impediments affecting the curbing of illicit financial flows of organised crime in developing economies

2019 ◽  
Vol 26 (1) ◽  
pp. 5-21 ◽  
Author(s):  
Emmanuel Sotande
Keyword(s):  
Developing Countries ◽  
Developing Economies ◽  
Task Force ◽  
Organised Crime ◽  
Policy Implications ◽  
Periodic Review ◽  
Financial Flows ◽  
Content Type ◽  
Serious Crime ◽  
Illicit Financial Flows

Purpose The purpose of this paper is to examine the treats hindering war against illicit financial flows of organised crime in developing economies and Nigeria in particular. The examination shows that the impediments facing the fight against money laundering and organised crime financial flows vary from one country to another. It may be lesser in developed economies where most instruments, treaties and best practice recommendations to curb serious crime originated from. However, the impediments against the proceeds of organised crime in developing economies are overwhelming. Design/methodology/approach The research methodology adopted was qualitative analysis. This was applied through the use and analysis of documents and expert interviews. Findings The impediments jeopardising the success against organised crime and other related serious crime financial flows in developing economies are devastating. Consequently, the study offered some policy implications to help mitigate these impediments in developing countries. The dynamics and the phenomena of organised crime business model are operated with ingenious strategies within the global states. Therefore, staying in control of the menace and the threats originated from the organised criminal activities would require periodic review of the global initiatives, standards and strategies deployed by the standard setters to combat organised crime and its financial flows in developing and evolving economies. Additionally, the implementing countries should be carried along and allow to make inputs when such initiatives and standards are being developed. Social implications In Nigeria, there is a clear evidence of “collateral damage” in terms of social justice as result of financial exclusion of many bankable adults of the country that do not possess unique identities for account opening documentation and customer due diligence of the Financial Action Task Force recommendation 10. Originality/value There have been quite a number of studies on organised crime and still fewer have recognised the need to explore the success or failure of combating the proceeds of crime in developing economies. This study provides answer to these gaps by screening associated risks of fighting the proceeds of organised crime in developing countries and Nigeria in particular.

Effect of quality of governance on the relationship between illicit financial flows and economic growth

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hazlina Mohd Padil ◽  
Eley Suzana Kasim ◽  
Fazlida Mohd Razali ◽  
Ruhaya Atan ◽  
Haziq Aminullah
Keyword(s):  
Economic Growth ◽  
Measurement Theory ◽  
Empirical Support ◽  
Financial Flows ◽  
Content Type ◽  
Illicit Financial Flows ◽  
Quality Of Governance ◽  
Asean Countries ◽  
The Relationship

Purpose The purpose of this paper is twofold. First, the study aims to examine the direct effect of illicit financial flows (IFF) and quality of governance (QoG) on economic growth. Second, this study seeks to examine the moderating effect of QoG on the economic consequences of IFF. Design/methodology/approach This study collected data from nine The Association of Southeast Asian Nations (ASEAN) countries for the period of 10 years from 2008 to 2019. The study concerned an analysis of the testing of a conceptual framework which based on secondary data which may lack a comprehensive substantiation on the grounds of measurement theory. A partial least squares (PLS) modelling using the SmartPLS 3.2.8 version was used as a statistical tool to examine the measurement and structural model. Findings Key findings provide empirical support on the effect of IFF and QoG on economic growth. It also confirmed that QoG significantly moderated the relationship between IFF and economic growth by reducing the negative impact of IFF on economic growth. Practical implications Immediate corrective action needs to be implemented by policymakers of ASEAN countries to strengthen QoG to effectively curb IIF activities. Originality/value This study provides current empirical evidence on the relationship of IFF, QoG and economic growth within ASEAN countries.

Addressing illicit financial flows in Africa

2016 ◽  
Vol 23 (4) ◽  
pp. 1074-1091 ◽  
Author(s):  
Bernd Otto Schlenther
Keyword(s):  
Money Laundering ◽  
Tax Evasion ◽  
Tax Avoidance ◽  
Medium Term ◽  
Profit Shifting ◽  
Financial Flows ◽  
Content Type ◽  
Priority Areas ◽  
Long Run ◽  
Illicit Financial Flows

Purpose This paper aims to identify the underlying key components of illicit financial flows (IFFs) and highlights the priority areas where government resources should be pooled under a whole of government approach to mitigate the risks posed by IFFs. These areas are tax avoidance and tax evasion (specifically intra-company profit shifting, investment and profit shifting within the extractive sector, fraud and beneficial ownership), anti-corruption measures, governance and accountability measures, anti-money laundering effectiveness and effectiveness in the detection of falsified customs declarations. Design/methodology/approach The concept of IFFs is emerging as an umbrella term for bringing together seemingly disconnected issues. The concept is ill-defined, but there are various identifiable components supporting the term IFF such as capital flight, corruption, money laundering, tax avoidance, tax havens and transfer pricing practices. The author identifies the key areas of concern through a literature review and recommends prioritization of short- to medium-term risk areas and long-term policy imperatives. Findings In the short- to medium-term, an effective “whole-of-government” approach should be based on uniform risk identification and prioritization between mandated government agencies and in the long run, it should be focused on building responsive and effective institutions through a process of good governance and effective taxation. Originality/value A large body of literature deals with “IFFs” and the “whole-of-government approach” as separate concepts. This paper draws on the existing literature and identifies priority areas for addressing IFFs, and, for these to be successful, they are entirely dependent on a whole-of-government approach – both in the short and long run.

The regime against money laundering: a call for scientific modelling

2018 ◽  
Vol 21 (4) ◽  
pp. 584-593 ◽  
Author(s):  
Emmanuel Sotande
Keyword(s):  
Money Laundering ◽  
Design Methodology ◽  
Developing Economies ◽  
International Standards ◽  
Dark Side ◽  
Financial Flows ◽  
Content Type ◽  
Illicit Financial Flows ◽  
Scientific Modelling ◽  
Combat Money Laundering

PurposeThe purpose of this paper is to examine the magnitude of the global problem of money laundering and the scholarly critics of money laundering concept. The paper further explores the scientific modelling to combat money laundering transactions.Design/methodology/approachThe research methodology adopted was qualitative analysis. This was applied through the use and analysis of documents and expert interviews.FindingsThe paper reveals how the global displacement on the fight against money laundering is being determined by “attractiveness index”. This attractiveness index is the dark side affecting anti-money laundering (AML) concept within developing economies. The critics of the AML accounts for major discrepancies associated with the context of the term AML regimes and international standards to combat illicit financial flows.Social implicationsThe regimes against money laundering compel countries to adopt the same recommendations and standards and were not given opportunity to proffer their own creative alternatives within their own circumstances.Originality/valueThe paper suggests AML Transaction Validation Model in the quest to combat illicit financial flows originated from organized and serious crime within the global jurisdictions.

Efforts to tackle Africa illicit flows will fall short

2015 ◽  
Keyword(s):  
Investor Sentiment ◽  
Sub Saharan Africa ◽  
Financial Systems ◽  
Financial Flows ◽  
Content Type ◽  
Trading Partners ◽  
Illicit Flows ◽  
Illicit Financial Flows ◽  
Financial Transparency ◽  
Sub Saharan

Subject Illicit flows from sub-Saharan Africa. Significance Illicit financial flows (IFFs) from sub-Saharan Africa (SSA) are estimated to be worth up to 50 billion annually, according to a recent UN report. The transfer of illicit flows through international financial systems has created opportunities for governments in European destination countries to recover plundered funds and prosecute those involved. These efforts set new legal precedents, but the rulings will be difficult to implement where governments are worried about the effect on investor sentiment. Impacts New and important African trading partners, from China to Dubai, will create new networks of illicit financial flows. Questions of financial transparency will arise, though irrespective of where the 'destination' negotiating partner is from. China's extra-territorial anti-bribery legislation shows efforts to comply with 'responsible' business, but so far lacks implementation.

Addis agenda lays down funding task for multilaterals

2015 ◽  
Keyword(s):  
New York ◽  
Sustainable Development ◽  
Sustainable Development Goals ◽  
Addis Ababa ◽  
Multilateral Development Banks ◽  
Financial Flows ◽  
Content Type ◽  
The Sustainable Development ◽  
Development Goals ◽  
Illicit Financial Flows

Subject Financing the Sustainable Development Goals (SDGs). Significance After a year of intensive negotiations, on July 16 the third UN conference for Financing for Development (FFD) culminated in 193 countries signing the Addis Ababa Action Agenda. The document sets out broad principles on how to mobilise finance in sufficient quantities to achieve the new Sustainable Development Goals (SDGs), which will be agreed in September in New York. The negotiations generated consensus around new norms on tax cooperation and illicit financial flows (IFFs), but also set ambitious expectations for multilateral development banks (MDBs). Impacts Addis begins a key year for development finance, culminating in December's Conference of the Parties (COP21) on climate change in Paris. The goal of COP21 is to draft the first universal climate agreement, which should take effect by 2020 at the latest. However, COP21 must also aim to map out a credible path towards mobilising 100 billion dollars per year in climate finance.

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