Quantifying the impact of illicit financial flows on sustainable development

2020 ◽  
pp. 127-148
Author(s):  
Keyword(s):  
Sustainable Development ◽  
Financial Flows ◽  
Illicit Financial Flows ◽  
The Impact

Illicit Financial Flows, Sovereign Debt, and Human Rights

2018 ◽  
pp. 317-336
Author(s):  
Cephas Lumina ◽  
Mulesa Lumina
Keyword(s):  
Sustainable Development ◽  
Human Rights ◽  
Sovereign Debt ◽  
Poverty Reduction ◽  
External Debt ◽  
Legal Framework ◽  
Financial Flows ◽  
Illicit Financial Flows ◽  
External Borrowing ◽  
The Impact

In recent years, there has been increasing attention to the problem of illicit financial outflows—broadly defined as funds that are illegally earned, transferred and utilized outside the country of origin in contravention of that country’s relevant legal framework. Illicit financial outflows divert resources away from activities that are essential for poverty reduction, sustainable development and the realisation of all human rights. They also contribute to the accumulation of external debt as governments that lack domestic resources as a result of these flows may resort to costly external borrowing. This chapter examines the nature of illicit financial flows, the factors that facilitate them and the measures taken by states, individually and collectively, to tackle them. It also discusses the impact of these flows on the realisation of human rights in the countries of origin and proposes concrete measures by which to curb illicit financial flows.

scholarly journals Remedies to Illicit Financial Flows from Transfer Pricing of Services and Hosting Intellectual Property in Kenya

2017 ◽  
Vol 3 (1) ◽  
pp. 113-130
Author(s):  
Charles Gordema
Keyword(s):  
Transfer Pricing ◽  
Primary Concern ◽  
Financial Flows ◽  
Taxable Income ◽  
Global Corporation ◽  
Intellectual Assets ◽  
Global Corporations ◽  
Illicit Financial Flows ◽  
The Impact ◽  
Pricing Of Services

Numerous reports in the last decade have focused on the challenges to African economies that emanate from the illicit transfers of funds and other valuable assets within some global corporations. A primary concern is the impact of these transfers on the taxable income of African subsidiaries. Two broad categories of intra-group transfers are of particular interest, partly because of the complexities they raise. One comprises transfers in payment of services exchanged among associated enterprises, while the other pertains to transfers by subsidiaries in payment of the value of intellectual assets attributed to the corporate centre of the global corporation. This article highlights the challenges raised by these transfers through case studies. It examines possible mechanisms to mitigate the challenges, drawing attention to current and impending developments. It concludes that there are good prospects for curbing illicit transfers linked to the examined types of transactions.

FINANCIAL PRIORITIES OF ECOLOGICAL SAFETY SUPPORTING (BASED ON THE PRINCIPLES OF SUSTAINABLE DEVELOPMENT)

2017 ◽  
pp. 5-10
Author(s):  
Ганна Олександрівна Обиход ◽  
Алла Анатоліївна Омельченко
Keyword(s):  
Sustainable Development ◽  
Environmental Economics ◽  
Associate Professor ◽  
Public Institution ◽  
Ecological Safety ◽  
Financing System ◽  
Financial Flows ◽  
Structural Funds ◽  
Regional Budget ◽  
The Impact

UDC 330 : 502.57 : 504 Hanna Obikhod, PhD (Economics), associate professor, senior researcher. Alla Omelchenko, PhD (Economics), researcher. Public Institution «Institute for Environmental Economics and Sustainable Development of NAS of Ukraine». Financial Priorities of Ecological Safety Supporting (based on the principles of sustainable development). The authors distinguished the need for further development of the funding system of guaranteeing ecological safety is established and a conceptual scheme of approaches to defining its priorities. There are described in the article the areas of optimization of financial flows in view of continued decentralization processes. These areas include: improvement of budget funds use (at national and regional levels) in environmental and natural and technogenic safety area; monitoring of funding; focus on balancing expenditures and revenues to the regional budget; strengthening of fiscal capacity of the latter; paradigm shift of financial support for environmental security of the region; development of environmental insurance. Possibilities for improving the financing system in the field of safety based on the potential involvement of EU structural funds, especially The Cohesion Fund, which is not currently available in Ukraine, are grounded. This structure makes investments through appropriate mechanisms to overcome territorial disparities, including the environmental field. Special attention should be paid to the developed technique of evaluating the effectiveness of the use of its funds by indicators of the environmental state, energy to overcome the impact of climate change, the development of trans-European transport network (TEN-T). Key words: ecological safety, financial priorities, reserve fund, sustainable development.  

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.

scholarly journals Orphan Imports and Lost Exports in India’s Trade: A Quantitative Assessment of the Significance and Implications for Illicit Financial Flows

2021 ◽  
Vol 9 (11) ◽  
pp. 92-107
Author(s):  
Javaid Akhter ◽  
Praveen Tiwari
Keyword(s):  
Quantitative Assessment ◽  
Mitigation Measures ◽  
Partner Country ◽  
Financial Flows ◽  
Trading Partners ◽  
Illicit Flows ◽  
Import And Export ◽  
Illicit Financial Flows ◽  
The Impact

Orphan imports and lost exports refer to import and export transactions that have been reported by only one of the two trading partners.They are excluded from computations of trade mis-invoicing based on comparing partner country trade statistics. We show that India’s trade with 19 trading partners over 2000-2018 not only indicates substantial trade mis-invoicing but alsosignificant orphan and lost trade in the commodities displaying mis- invoicing. We also show that the amounts involved show an uptrend and are more pronounced in imports, with the orphan imports recorded by India being more than 15 times the orphan imports recorded by partner countries. Therefore, any conclusion on illicit flows through mis-invoicing in these commodities will be incomplete without analysing the impact of orphan and lost trade. We analyse some possible causes and discuss specific commodity-level examples to demonstrate that orphan and lost trade could not only lead to re-adjustment of computed amounts of trade mis-invoicing but, in the worst scenario, indicate serious fraud, with important implications for illicit flows. The paper’s finding that only a few commodities account for bulk of the amounts in orphan and lost trade could facilitate better analysis and mitigation measures.

scholarly journals Empirical Investigation of Capital Flight and Illicit Financial Flows, Economic Growth in Palestine

2019 ◽  
pp. 1-15
Author(s):  
Nemer Badwan ◽  
Mohammed Atta
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
The State ◽  
Balance Of Payments ◽  
Capital Flight ◽  
Causality Test ◽  
Financial Flows ◽  
Study Results ◽  
Illicit Financial Flows ◽  
The Impact

In the present study was to verify the relationship between capital flight and illicit financial flows, exhibiting the impact of stable economic growth in Palestine during the period (2009-2018). We also use models of the balance of payments of the State, the study results showed that the total illicit financial flows, about $14.42 million annually, 16.4% of GDP. In addition, through the application of the net omissions and style error in the balance of payments and expenditures, the total capital flight estimated at $26.61 million, 19.6% of GDP. The Granger causality test shows that economic growth granger causes both the illicit financial flows and the capital flight. The study also found that there is a negative and significant relationship between economic growth and capital flight. Furthermore, there is a positive relationship between illicit financial flows and capital flight. We have examined theory (Granger) causality, which shows that economic growth causes all of the illegal financial flows and capital flight. The study showed also negative correlation and significant between economic growth and capital flight. Besides, it can be this relationship is negative between illicit financial flows and capital flight. This relationship can be detailed in this research. It seems this experimental investigation is also a strong relationship and engagement between capital flight and financial flows from the standpoint of their impact on economic growth in Palestine. It can be summarized in the study that the process of capital flows and capital flight represent an important role in raising the rate of economic recovery in the country and that the flow of capital within the state is one of the most important factors for national economic growth.

International Efforts to Combat Corruption

2021 ◽  
pp. 494-515
Author(s):  
Mathis Lohaus ◽  
Ellen Gutterman
Keyword(s):  
Soft Law ◽  
Future Research ◽  
Transnational Advocacy ◽  
International Treaties ◽  
Financial Flows ◽  
Advocacy Campaigns ◽  
Illicit Financial Flows ◽  
And Behavior ◽  
The Impact

Attempts to improve the domestic quality of government often involve international arrangements and the fight against corruption is a prominent example. Since the 1990s, anticorruption pledges, international treaties, soft law arrangements, transnational advocacy campaigns, and other commitments have proliferated to control bribery and corruption in a range of contexts. This chapter surveys the literature on the emergence and characteristics of these various initiatives and provides an overview of what is known about their impacts on policy and discourse, law, and behavior. While empirical evidence on the impact of international anticorruption efforts is mixed, existing studies and directions for future research suggest that the quality of government in highly developed states is crucial when it comes to controlling transnational business bribery, money laundering, and other illicit financial flows.

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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