Global report on the illegal wildlife trade

First global report on the illegal wildlife trade was recently released by FATF. It is called the “Money Laundering and the Illegal Wildlife Trade” report.

Financial Action Task Force (FATF) has described illegal wildlife trade as a “global threat”, which also has links with other organised crimes like modern slavery, drug trafficking and arms trade.

Key findings:

1. The illegal trade is estimated to generate revenues of up to $23 billion a year.
2. Criminals are frequently misusing the legitimate wildlife trade, as well as other import-export type businesses, as a front to move and hide illegal proceeds from wildlife crimes.
3. They also rely regularly on corruption, complex fraud and tax evasion.
4. There is a growing role of online marketplaces and mobile and social media-based payments to facilitate movement of proceeds warranting a coordinated response from government bodies, the private sector and the civil society.
5. According to the 2016 UN World Wildlife Crime report, criminals are illegally trading products derived from over 7,000 species of wild animals and plants across the world.

Challenges:

Jurisdictions often do not have the required knowledge, legislative basis and resources to assess and combat the threat posed by the funds generated through the illegal trade.

Criminal syndicates are misusing formal financial sector to launder the proceeds.

• Funds are laundered through cash deposits, under the guise of loans or payments, e-banking platforms, licensed money value transfer systems, and third-party wire transfers via banks.
• Accounts of innocent victims are also used and high-value payments avoided to evade detection.

Front companies, often linked to import-export industries, and shell firms are used for the movement of goods and trans-border money transfers.

What needs to be done?

1. The report says financial probe is key to dismantling the syndicates involved, which can in turn significantly impact the associated criminal activities.
2. Jurisdictions should consider implementing the good practices. They include providing all relevant agencies with the necessary mandate and tools; and cooperating with other jurisdictions, international bodies and the private sector.
3. Legislative changes are necessary to increase the applicability of anti-money laundering laws to the illegal wildlife trade-linked offences