Illicit financial flows (IFFs) present a complex global challenge. The term refers to financial flows that are illicit because of their origin (e.g. stemming from environmental crime), their purpose (e.g. to finance terrorism) or the nature of the transfer (e.g. money laundering).
Their effects are especially devastating for low-income countries and undermine international efforts to promote sustainable development.
The criminal activities linked to IFFs can destabilise entire regions and increase the risk of violent conflict.
The United Nations estimates that USD 1.6 trillion are lost every year due to IFFs – dwarfing the amount low-income countries receive in official development assistance. IFFs prevent urgently needed investments in health, education and other public services.
Moreover, access to international finance depends on how well countries can prevent ‘dirty money’ from entering the financial system.
Global, regional and national systems for the development-oriented fight against illicit financial flows are strengthened.