Thematic session 2: The value of confiscated proceeds of crime related to money-laundering arising from drug trafficking at the global level remains low
Angela Me, UNODC Research and Trend Analysis Branch: (…) This area requires sophisticated data collection and analysis. I have been working in the UN in my career with all kinds of data and statistics on the social and economic areas. I believe crime is one of the areas where there is the most reluctancy to share data across countries and also within countries. So, one of the things that we do in UNODC when we provide assistance on crime statistics for example, one of the first things is to really define this national coordination system with different agencies. Thank you.
Venezuela: You showed the different sources where the culture of drug trafficking and drug crime in general was similar, what do you think it will be the percentage of GDP if we compare this figures to (…) it is not a very precise amount since we don’t have the right number. Would it be also as high as the one that you can actually show or it will be lower?
Angela Me, UNODC: Okay, a proportion of illicit financial flows that I showed is a component that relates to illicit financial flows – the way how the international community talks about the flows has more to do with tax evasion, more macroeconomics. So, what is the proportion between the crime and the tax macroeconomic… I don’t think we have a good estimate, but there are a lot to say about capital flows coming out particularly from developing countries to developed countries. But again, in terms of all the more structural framework, we don’t really have a precise number so I think it’s hard to say. We have anecdotal information that drugs are the biggest component in terms of the criminal income. The ratio of drugs income compared to the GDP of Mexico and Colombia will be much lower because they are much more economically developed than Afghanistan. So, in Afghanistan, the drug economy is a substantial part of the national economy while in Mexican and Colombian economy, drugs remains still a very low percentage of the national economy. Thank you.
Iran: According to the World Drug Report, there is an increase in production of synthetic drugs in Afghanistan. My question is, do you have any concrete data regarding the illicit financial flows of synthetic drugs?
Angela Me, UNODC: Not at the global level. We did an estimate for Southeast Asia, now it doesn’t come precisely on my mind but it can be found in a transnational organized crime threat assessment that we did for Southeast Asia.
Michiel Van Dyk, Head of the Global Programme Against Money Laundering, UNODC: It’s my pleasure to address you this morning, and to specifically talk about this challenge we have in front of us to implement sustainable development goal target 16.4 that calls on member states by 2030 to significantly reduce illicit financial flows, strengthen the recovery and return of assets, and to combat all forms of organised crime. Now as you’ve heard previously from Angela, the reality that we observe is different in the sense that there was report by UNODC estimating the illicit financial flows, and in that report, the conclusion was that less than 1% of proceeds were confiscated. So the reality is that much less is confiscated than we need to do to address this this target. So we have our work cut out for us. A major challenge that we observe while providing capacity building and training to developing countries, is that while countries are very good at investigating the predicate crime of drug trafficking, following the money is more often than not, is still lacking. So the challenge for us is then to help the states, address this. Since 2018, we assisted 11 countries, between Burkina Faso, Cote d’Ivoire, Ghana, Guinea, Mali, Asia, Nigeria, Senegal, Sierra Leone and Togo 473 practitioners have been directly trained on financial investigations. And out of this number 124, including 14 women, received the full training, and are certified as trainers. We embed our training courses with the national training academies, so another outcome under this project was that we observed that over, 3500, law enforcement, and judicial authorities in their respective countries were trained by the certified trainers and we saw an increase convictions for money laundering – specifically in Ghana, Mali and Senegal. Also the authorities of the concerned country stated that these successes were directly attributed attributable to the training that they received. So, this is an excellent outcome. Also in the Western Balkans, on the project called Building Regional Anti Money Laundering and Counter Financing of Terrorism capacity for Albania Bosnia, Bosnia Herzegovina, Montenegro North Macedonia, Serbia and Kosovo, under UN Security Council resolution 1244, we implemented a similar training programme where over 456 officials were trained, and 61 certified as trainers. UNODC has also been helping and assisting member states to develop informal networks of law enforcement and traditional practitioners in the field of asset tracing, freezing, seizure and confiscation – in the asset recovery interagency networks. The first one was established in 2009, and the most recent one in Western-Central Asia in 2018 with different levels of development. This is a real success story. So how it works is you have your law enforcement contact point and you have your prosecutor contact point, who support the complete asset recovery process. So, from the starting point of investigating, we are tracing freezing, seizure, the management, and finally the forfeiture confiscation. These informal networks play a key role to recover assets. To conclude, what is clear is that the international community, UNODC, member states, as well as the private sector should increase efforts to have effective anti-monitoring systems in place. So, we should double our efforts, to better understand the existing risks of how criminals operate. The evidence in this area, as Angela mentioned, is limited. So, can we do more for sure. Efforts should not only investigate the drug trafficking but predict the crime and conduct the parallel financial investigation, as was mentioned earlier. Thus actively following the money. We should also not only confiscate drugs, but criminal profits and related assets. Thus, demonstrating to criminals that crime does not pay, Inter-agency collaboration is always very high as a priority. Sou you need to have your law enforcement investigators, who can bring in the financial reporting entities, your Financial Institutions your DEA and FPPS, your designated non financial businesses and professionals. What do I mean by that, casinos, lawyers, real estate – so in the public sector interagency collaboration is key. And you need to involve the private sector. So, you should strengthen public-private partnerships and leverage these partnerships to effectively address drug trafficking and money laundering. The UNODC stands ready to continue to work with Member States and other partners to strengthen the Member States money laundering regimes linked to drug trafficking. And today, countries are being evaluated under their mutual evaluation systems, we’ve moved away from technical compliance, today we are looking at having effective systems in place. So, that is the main goal of UNODC to assist you as a member state to have an effective system in place. Thank you very much.
Mexico: Thank you very much for the presentation. You ended with two specific commitments, the one containing challenge 43 of the ministerial statement of 2014, where we strengthened networks for the exchange of information and information related to the detection or seizure and confiscation of proceeds of drug trafficking and related crimes, and criminal asset recovery, as well as calling for develop and strengthen bilateral, regional, international mechanisms so it’s good to learn that there are new tools that have been developed in order to help us implement those commitments. So, given that the first of these networks was established in 2009 and the last in 2018, how come we didn’t recognize them in our three political documents? Why we don’t have earnings in all regions – there were some there are some regions missing. Also, how are they working regionally communicating with each other, and the outcomes of the work?
Michiel Van Dyk, Head of the Global Programme Against Money Laundering, UNODC: The networks are all based on the Europol system. If you belong to one network, then you automatically have this connection because they all have relationships with each other – to give you a practical example: There was a case in our Southern Africa region, where one of the member states wanted to exchange information between contact point to contact point, it was a specific request in relation to assets located in Switzerland, and by the networking, through the Secretary, he got an answer back from the contract. Why do we only have it in certain regions? It comes down to resources, and political will. because this is a system that the countries in the region should want themselves, and, as you will hear later today states could see the benefit
EU: Maybe you could also elaborate a bit on what is the added value of these netwroks, for instance, to other existing channels of communication like Interpol communication network and to enlighten us a bit more but what really is the function of setting up another network of networks in addition to already existing networks and the channels?
Michiel Van Dyk, Head of the Global Programme Against Money Laundering, UNODC: Excellent question. The added value that is communicated to us by MS and that we also see is that: number one it’s an informal network so it’s very easy for a contact point in a country A to contact a counterpart in Country B. You have regular steering group meetings of the networks, you have annual general meetings where various issues are being discussed, and that gives them a different platform. Based on the informality, I think the contact points feel very comfortable with each other and open to exchange information. I think it’s very important that, yes, you shouldn’t just establish one for the sake of establishing one.
Jamaica: Organised Crime presents significant security challenges for the state. It’s for this reason that Jamaica have created comprehensive legislations, in particular the Proceeds of Crime Act and the Financial Investigations Division, just to name a few. The investigative tools, for example, compel a person in possession of any record or document, which has to do with financial crime, to produce this information, and there’s a similar approach to disclosures with proceeds of crime. More importantly, this legislations is providing restitution to victims and communities (…) So, my question is: How can we strengthen interagency collaboration? What tools can we use to assist with the enhancement of analysis of data and tracking financial flows.
Michiel Van Dyk, Head of the Global Programme Against Money Laundering: I would have to get back to you on the first question. As for your second question in relation to interagency cooperation and collaboration… as a start, when we bring different agencies for training, the first goal is obviously to promote the networking, training, but a more formal system is always recommended so in some countries they call it a National Coordinating Committee, made up of various ministries that will look at money laundering and counter financing of terrorism and then they can be joined in discussions and decision making. A very effective system is a round table that one of the member states in the country would convene – the Embassy of the country will convene it once a month and bring different ministries and agencies together. But more importantly, they will discuss challenges – a different challenge at every meeting. To give you a practical example, at one of the meetings that they did, they invited the Revenue Service to talk about challenges that foresee and various other topics… so that that is also a best practice for the enhancement of analysis of data in our sphere and now I’m not talking about the research tools because I’ll leave it to Angela to answer that one. UNODC developed softwares for financial intelligence units, so when the reporting entities log the suspicious transaction, the analysts can analyze the data, and then distribute it to law enforcement
Drug Control and Prevention, regional office for Southeast Asia and the Pacific: I was involved in the initial discussions for the setting up of Karen, and the first meeting was attended by 10 countries who wanted to set up the network. So today, the number in the network is 33 countries in the Caribbean Basin. And there are also observers, OAS, United Kingdom, Canada, … The question which was specifically asked by Jamaica, we will address later.
Stephen Fry, Commander of the Criminal Assets Confiscation from the Australian Federal Police: Obviously, taking the profit out of crime is the work that we do in the Criminal Assets Confiscation force here in Australia. In the brief time I have, I’m just going to cover three factors in relation to the issue which we are discussing today – in relation to why the value of confiscated assets arising from drug trafficking on those foreign remains so. Regarding successful asset confiscation, that we have found important in Australia is how jurisdictions or how even organisations or law enforcement agencies or authorities actually define transnational organised crime or serious organised crime. We refer to the UNODC in this regard and what I really like about that is that it talks about organised crime being rationally working to profit from illicit activities, or responding to great public demand. Too often, organisations are referred to organised crime as three or more persons involved in drug trafficking, human trafficking or criminal activities without really defining the underlying issue that organised crime and drug traffickers use anything because of the profits. So, if you frame the problem without the fact that it is all about driving illicit profits, your response is not tailored to addressing the underlying motivation. Another important point I think is that whilst a lot of law enforcement authorities focus on the predicate offences, the illicit commodities, they focus on drug interdiction and often not do a parallel financial investigation and asset confiscation, which misses the underlying factors of the criminal business model. So, we have good investigators doing a range of activities, but I think over time that financial literacy is such an important part to help understanding criminal business models. And lastly, I want to talk about the takedown of a huge cryptid platform in Australia and of course, around the world. It gave us an insight that we saw that perhaps maybe some of the traditional organised crime are still at the start of cryptocurrencies, and again that needs another level of literacy and understanding for investigators because we’re starting to see traditional organised crime turning to cryptocurrencies to escape their wealth from authorities and transfer value, that’s another important skill set that is very important to guide our work in the future. I think the third reason is that there are very differing international legislations in relation to asset confiscation. Some jurisdictions have conviction-based confiscation, others have non-conviction-based and that provides challenges when you’re tackling organised crime and drug trafficking that knows no borders. Just to give you a very brief case study here – we did an investigation in Australia where an offender were found with 4 to 5 million dollars of unexplained wealth. Under the investigation, that offender fled to Southeast Asia which obviously then prolonged the confiscation process. A number of years passed and the offender came to notice independently in the Southeast Asian jurisdiction from another investigation, where he was then found in possession of almost $10 million Australian cash overseas but that jurisdiction is a conviction-based jurisdiction. So with this quick case study I wanted to show you the complexities that you can experience. I’ve talked to you before about our provider compensation model, and there is a model where we bring multidisciplinary people together in one place – we have investigators and lawyers, so we do our own litigation in relation to confiscating the assets, we have forensic accountants and we have partners from a range of other agencies. And so the agencies that we bring together are all part of that task force – our police officers, intelligence, of course we’ve got tax office and an official trustee to manage assets as well. And all of those come together for like a one stop shop model to sort of undertake criminal organisations and confiscate instruments and proceeds of crime. Another important thing is using alternative strategies to investigate suspicious money laundering related assets. And here is a case here in the media in Australia. This was a referral by an NGO, in relation to the flight of illicit flows. So we’re able to undertake a convalescent investigation in relation to those funds, but not necessarily have to rely upon original evidence or information that come from a host jurisdiction, and that was an effective way to sort of confiscate assets. The last point I’ll make is that we’ve developed a model in Australia through our legislative system, where we are able to divert money from the criminal economy to be reinvested into projects that are authorized in our legislation – it can be used for reinvestment into drug rehabilitation and drug diversion programmes. So it’s essentially kind of the classic thing of taking away money from the bad guys and giving it to the community, ensuring safety and security for Australians. At the moment we’re at about $460 million of assets and we’re striving to get to a five year target of $600 million. So we’re doing quite well. And lastly, we have an estimated return on investment of approximately 2.5 dollars to every $1 invested, demonstrating value to the communities affected. Thank you.
Speaker: One of the things that was mentioned in the presentation prompted me to intervene in reference to cryptocurrencies in illicit drug trafficking and other activities. And I wonder if based on the experts´ experience at the national level, whether there any mechanisms or tools that member states can utilize to seize cryptocurrency proceeds of crime and provide restitution to victims?
Mexico: …cryptocurrencies might present a number of challenges, we will have to address that new reality that we’re facing.
Nigeria: ..new challenges in many countries, and that also brings us to the point of international cooperation and seeing how we can take some of the best practices in different jurisdictions improve what happens at a national level. I saw this on the slide – can you only confiscate assets after a conviction has been established? I noted, you said proceeds go to invest back our communities, but I saw only Australia so I would like to find out whether or not the confiscated assets, usually belong to Australia that are applied to improve the communities
Stephen Fry, Commander of the Criminal Assets Confiscation from the Australian Federal Police: Thank you for those comments and questions. To the colleague from Nigeria: assets can only be confiscated or restrained, so to speak, whereas the conversation can only occur upon the conviction for a criminal offence. In Australia we have both conviction-based confiscation and non-conviction based on the basis of suspicion. And then we also have unexplained wealth, where assets can be confiscated. In Australia, our legislation does permit the sharing of assets with a foreign jurisdiction. So if there is joint cooperation between one country and other country, then yes, assets can be shared or the legislation sets out that all funds need to go into what we call the confiscated assets account. In our legislation Australia sets out the assets you can shoot back with a participating jurisdiction or a participant in country, however, that discretion is at the ministerial level. So, yes we have done asset sharing with foreign jurisdictions in the past, and we will hopefully continue to do so in the future.
Russia: I also have a question about cryptocurrency, what services are you using within investigations online?
Ghana: I want to know what happens to the assets, if the case is ongoing. Are you allowed to invest that money to yield something? And also, have you ever experienced it, that at the end of that case, ruling was that the money should be returned to the suspects? Most of the time you’ll hear them saying that it’s business money and it’s been locked for years so they are demanding.
Stephen Fry, Commander of the Criminal Assets Confiscation from the Australian Federal Police: I think it was in the previous comments, yes the issue of crypto it is still a challenging space. We talking having to coordinate to improve our financial investigation skills and understand cryptocurrency. This is another level of expertise that we continue to try to improve and we’ve started to develop a cryptocurrency team to assist our investors because we see it that certainly there is a move toward cashless societies, certainly in a number of economies. I certainly see the importance of cryptocurrency and understanding from law enforcement purposes are really important. There are a number of software tools out there, commercial software tools that provide tracing facilities that are commercially viable. And we seek to use a number of those different sort of softwares to assist us in our tracing and cryptocurrencies and to assist us with our investigation so that is what we are doing at the moment but as I say, we are very small, I don’t want to overestimate that we have a massive level of sophistication. To the colleague from Ghana, think your question was in relation to the money. So yes, when we restrain the assets that is basically money in a bank account, you’re quite rightly that the money that is restrained goes to our official trustee that upholds the money and to generate interest that has been gained from that money. So, the money is held in trust so to speak, until the completion of the proceedings. And I think the last question was, has the money have been returned to the suspect – Yes, there has probably been some cases where we have been unsuccessful in our asset confiscation, however that is not common. So if we aren’t successful then we may have to pay costs or damages to the person. But as I say, it does not happen often.
UNODC: In 2018, the Global programme on cybercrime in the global programme against money laundering was merged into a new section called the cyber crime and anti money laundering section and one of the first joint work that we conducted was to establish a training course on cryptocurrencies. UNODC has a global e-learning site that you can access that will promote basic awareness on cryptocurrencies. The training course obviously goes into more detail as the previous speaker mentioned that there are various commercial software tools available.
Mohammed Nasrun, Interdiction and Verification, National Court of Indonesia: …
Thailand: (…) international relief agency on assess confiscation?
Mohammed Nasrun, Interdiction and Verification of the National Court of Indonesia: Thank you. I let you know that BNN has shared with other parties, for example, the tax assessment of drug dealers financial digest …
Abrahim Abdul, Director Assets and Financial Investigation, National Drug Law Enforcement Agency, Nigeria: … Nigeria´s legal system is conviction based. Competent authorities are allowed to confiscate once there is a conviction … The problems that we encounter during the COVID 19 pandemic when the protocols were put in place and public places went into a total shutdown…. the precursor chemicals that are used in the manufacture of opiates which are highly abused in northern Nigeria could not be imported as well … movable assets including large amounts of dollars at the airport and sea borders were intercepted, so we comply with international agreements. And one other problem that we encounter COVID-19 pandemic was actually regarding the execution of mutual legal assistance, especially, that has to do with the International assets on international project African. Most of those jurisdiction where we sent requests for assistance system did not show the political will to do that. Then we also have problems of legal system differences among jurisdictions, as a civil law jurisdictions making things a little cumbersome. This is a major stumbling block that we’re facing. It also affects the issue of extradition in specific countries. We also have difficulties with requests for information. Many countries don´t oblige section 14 of the international convention. These factors led to the reduction in the number of seized assets in Nigeria.
EU: This was an impressive impressively comprehensive list of challenges and reasons why there is this low rate of confiscation, and a lot has to do with efficiency and international cooperation. But I would also like to go back to something that the Australian colleagues said earlier which was that countries generally are very good at investigating the predicate offences, but they’re less good at then following up with financial investigations and freezing and ultimately confiscating assets, so I was wondering if that also in your jurisdiction?
Nigeria: With the help of UNODC, we trained many professionals on parallel investigations. There is a nature of suffering, arising from even proving the elements of crimes in Nigeria because, for you to prove an offence in money laundering, you must work with reasonable doubt, which means all different elements of proving money laundering must be advanced before the court. One there must be knowledge to, there must be intention, three there must concealment – if you’re only able to prove one or two elements, you will face issues in the courts of in Nigeria. So, capacity building programs that will take place around December in Nigeria, will definitely assist investigators to implement international best practices.
Vladimir Panov, Russian Federation: … The trend of globalization of alternative methods between buyer and seller including electronic means of payment and cryptocurrency, the Hydra international trading platform, … The blockchain technology allows a high degree of anonymity which undoubtedly makes his method most attractive in the course of illegal activity. Thus, more and more often it makes conducting financial investigation more sophisticated as was mentioned in earlier presentations. Thanks to new software/services, it is possible to track not only the date and time of transaction but also to track the transactions using the Bitcoin cryptocurrency, up to its withdrawal. However, due to the fact that the currency exchanges are located on the territory of various countries, financial investigation relies on international cooperation to locate criminal income. For example, we found an organized group in the central region of Russia, with an underground drugs laboratory in a rented household producing synthetic drugs. Their income in crypto was transferred to an account in the US (?) that we were able to track, and so also caught interactions and identified who the personal account belongs. We identified bank cards and found that it was related to income from criminal means.
Mexico: We’re learning a lot about cryptocurrencies – yet there’s not a single mentioning of such currencies in our political papers. It is disturbing that our commitments which are related to the recovery of assets, don’t even mention the issue of emerging technologies. We are grateful for the presenters raising awareness of acute issues we need to place on the political commitments
Chair: I wonder if you could share some data on sort of how often these currencies are used for money laundering
Vladimir Panov: Unfortunately, we see an increased number of criminals using of cryptocurrencies – thousands and thousands…
VNGOC / John Collins, Global Initiative against Transnational Organized Crime (GI-TOC): This presentation will focus on the theme for this session – the value of confiscated proceeds of crime related to money-laundering arising from drug trafficking at the global level remains low. In addressing this theme, it’s important to understand that there are multifaceted links between drug trafficking and illicit flows, and that it is very difficult to measure and monitor the volume of flows in monetary terms – and therefore to understand how proceeds confiscation figures relate to that. It is in the nature of illicit markets that money is moved in the shadows and is enabled by corruption – so law enforcement find themselves chasing those shadows and blocked by corruption. In fact what is sometimes a more useful measure of illicit flows, including from drug trafficking, is what impact they have on society, the economy – and on sustainable development. As this is a UN meeting, sustainable development is the lodestar of what we are trying to achieve. In particular SDG target 16.4: UN member states pledged to “significantly reduce illicit financial and arms flows, strengthen the recovery and return of stolen assets and combat all forms of organized crime, by 2030”. And the UN itself has stated that “[IFFs] allow wealthy and exploitative elites and criminal actors to launder the profits of their ill-gotten gains, to evade taxes, use political power for personal gain, [and] conceal the ownership of assets. They thereby undermine efforts to limit wealth inequality, reduce governments’ capacities to support development and inclusive growth goals, and significantly undermine the rule of law.” I echo this viewpoint and believe that IFFs represent the “life blood” of crime and corruption, importantly when those flows are related to drug trafficking. They facilitate the dominance of corrupt elites that maintain dominant power structures across geographies. They are perhaps the most significant obstacle to equality, fairness, and opportunity in transitioning economies. The term IFFs is actually a relatively recent one, promulgated by one single civil society institute, Global Financial Integrity, under their unique analytical framework. Since GFI’s first report, the term IFFs has been eagerly adopted as a rallying cry by developing economies, keen to see the international financial centres shoulder their responsibility for resource and value diversion. The term is now firmly embedded in the development lexicon, though without a clear and universally accepted definition, although UNODC’s recent work on IFF definitions has helped move improve understanding. GFI’s metric of trade mispricing estimates IFFs averaged a 4.0% of the developing world’s GDP over a twenty-year period. In 2014 alone they estimate US$620–970 billion was transferred out of developing countries. Drugs, of course, remains a huge component of the flow of IFFs. But the exact monetary value, due to the nature of illicit economies, is very difficult to measure. We have looked at regional examples to better understand, instead, the political economy of IFFs and the effects they have on society. Our 2021 study on the Western Balkans’ drug routes traces how the region has become a major distributor of drugs in areas from Latin America to Western Europe and Southern Africa. In particular, our study argues that weak governance and corruption are certainly two enabling factors for illicit financial flows related to drug trafficking. As demonstrated by the research, criminals originating from the Western Balkans region have set up a very lucrative business model favored by the increasing supply and demand for cocaine, heroin, and cannabis. The Balkan route, especially for heroin, provides access to Western Europe. UNODC previously estimated that 60-65 tons of heroin flow through south-eastern Europe each year – worth c. € 960m+ in 2020. 1kg heroin is approximately worth twice as much in the Western Balkans as it does earlier on in the Balkan route, and it doubles again in value when it is sold in the EU. Cannabis is the most commonly used and seized drug. Wholesale prices range from €1,000 , to €1,550 to €1,900 per kilogram across the Western Ballkans region, depending on quality and availability. Moreover, the GI-TOC research on the political economy of heroin markets in East and Southern Africa has highlighted how the flow of illicit finance deriving from the heroin market is not only a security problem but rather an increasingly development issue. In particular, the study deepens the impact that IFFs coming from drug trafficking has had on the growth of many small coastal villages. Firstly, the study argues that the drug trade has greatly increased the risk of urban violence. Secondly, it maintains that IFFs have long been advantaged by the development of transport infrastructures employed in multiple illicit trade networks – in varied countries across the region. IFFs deriving from drug trafficking in East and South Africa have become a prominent feature of urban politics and development, that should not be underestimated. Clearly, it is a concern that the volume of confiscated assets from these activities remains low. And to effectively tackle organized crime and illicit markets, states must make a greater effort to increase their seizure of assets arising from money laundering and illicit drug trafficking, including through better coordination and transparency. But what is more concerning are the development and security threats of these IFFFs. Our regional examples are illustrative of the global and local effects on development and security of illicit financial flows related to the drugs trade – poverty, violence, drug addiction and health impacts, and a general breakdown in good governance. The response not only lies in the seizure of drugs and money, but a holistic response including the prioritization of urban security, support for community resilience and including civil society voices at all stages.
Jamaica: I actually have a question for the previous presenter. What are the main types of cryptocurrencies being utilized? Are there are varying levels of difficulties in tracking these proceeds based on the character itself?
Chair: Our previous panelist is not online. John, I want to ask how you would see the role of the civil society in increasing the Italians confiscated.
Mexico: Not surprisingly the commandments which specifically address the issue of compensation of proceeds of crime section are not very explicit in the involvement of civil society organisations (…) perhaps you could speak about supporting these efforts.
VNGOC / John Collins: As an organisation that makes great strides to bring civil society organisations into the organised crime discussion of the drugs debate, we are particularly cognizant of the local understanding that civil society groups have on the impacts. So creating new entry point for CSOs to help understand illicit economies and how illicit financial flows and enter into the broader illicit economy. So, really it is about creating processes that are more accessible to civil society organisations, and thereby allow them into this process as well to give their inputs.
EU: Thank you for this presentation, you were referring to financial flows, and the lack of a clear definition. And indeed, it’s a term that encompasses many illicit activities. I’m wondering a bit whether from your perspective, it is actually a helpful term given it’s vagueness… and is it would make sense to define these clearer?
VNGOC / John Collins: I think there is much merit in what you’re saying. It is difficult because people want to encapsulate so many elements that which relate to the sustainable development goals within a term. There’s a complexity that gets lost about what is specifically criminal flow, which is related to the misallocation of money out of an economy or the flow of an economy. I think that personally I think that is an issue that is worth examining.
Nigeria: I think I might agree with you. We are one of the delegations that think the term refers to the illicit flows. As Angela Me said, when it comes to the different kinds of jurisdiction, a clearer definition could be helpful. So I think we should all make an effort to ensure that we address this because it is a challenge when we give the impression that we don’t need understand what we are talking specifically. I also agree that we should collaborate more to have better understanding.
Danilo Campisi, UNODC Country office Pakistan:. I will be brief to leave space for questions, and also because couple slides we already covered this morning by colleagues. So, what are the result of the first three years of operation of our network – It is an informant network or law enforcement and mission practitioners. The aim of the network is to build capacity in Western and Central Asia. We use three languages of the region – English, Russian and Farsi. The eight founding founding members of the network can stand the Islamic Republic of Iran, Kazakhstan, Kyrgyz Republic, Pakistan, Tajikistan, Turkmenistan and Uzbekistan. After a long period of discussions and negotiations among all members, others joined. The website or the network is currently available only in English but the plans to the website available in three official languages by the end of this year. So, let me, let me tell you first that the network is entirely handled from the administrative point of view by the Secretariat, who are providing technical support and funds and it is located at the General Prosecutor’s Office in the Republic of (…). There are regular meetings and steering group meetings, capacity building trainings and we have approved a five-year strategic plan in 2019. The global asset recovery arena is regularly invited to participate in the network’s in meetings. There is substantial increase in regional and interregional cooperation. I hope that the secretariat will issue report at the end of this year with complete data of the operations. Our trainings focus on the Civil Asset Recovery legislation and the different processes, on open source intelligence for financial investigation and asset tracing and international cooperation and mutual legal assistant specific in the area of asset recovery. Last year, due to pandemic, most of our activities switched to online. We will have follow-up trainings in November. What is also extremely interesting is that in the network. the members agreed to sort of launch a peer review programme on the asset recovery systems. So the reports have been drafted and are now are available to all members of the network. I’d like to mention that to us, cryptocurrencies are one of the main topics to be discussed, and also beneficial ownership. The first country to be reviewed was Afghanistan. The audit was completed before August. The second country will be reviewed next year. We have plans to expand membership. Three more countries actually joined our meetings: Georgia, Azerbaijan, and Ukraine. The objective of course is to strengthen cooperation at a regional at the regional level, and make sure that the amount of assets seized will increase. Please reach out if you are interested in further information.
Priya Biseswar, Special Director of Public Prosecution, stationed at the Asset Forfeiture Unit (AFU), National Prosecuting Authority (NPA) of South Africa: My presentation will focus on the technical assistance provided by the (…) network to the member countries that was established in terms of section 179 of the Constitution of the Republic of South Africa. It is supported a jointly by the National prosecuting authority of South Africa, and the UNODC in order to address the transnational organised crime in the region, including drugs. The network provides technical assistance to run the member countries through the network – the first of such type of assistance is referred to as the Prosecutor Placement Programme and is hosted by South Africa. The commenced in 2009 held three times a year, with the support of donors in the form of funding. It entails a one-month Placement Programme in South Africa. It involves a classroom type training where delegates are trained on various aspects of asset recovery legislation and the technical guidance on how to draft such applications, the following three weeks is exposure to practical work in a very operational office, and we have nine such offices in South Africa. The practical aspect entails drafting actual applications that can go to court, dealing with a post asset recovery applications, attending court proceedings as observers, and having the opportunity to witness a matter being proposed in front of a judge in the High Court of South Africa. We provided training to 156 delegates thus far from Botswana, Burundi, Ethiopia, …, Kenya, Lesotho, Madagascar, Malawi, Mauritius, Libya, Nigeria, South Sudan, Tanzania, Uganda, Zambia and Zimbabwe. Unfortunately, due to the restrictions imposed by COVID, we were unable to conduct the prosecutor training programme during the period 2020-2021. However, due to the success of the programme, financial investigators has developed. We were very successful in training our advocates our litigators in bringing such applications and we felt that there was a need to extend the programme to train the financial investigators in order to support such applications. The first programme is currently being piloted in Zambia. We faced some challenges, and such example was Mozambique because of the difference in legal systems. We often provide very informal assistance to other Member States. When these member states are experiencing opposition in certain aspects of the law, for example Namibia, when they were experiencing opposition with the concept of exclusion of property, forfeiture order so we provided mentorship and guidance to litigators and how the matter should be argued in court. In South Africa we have a body of internal policies and guidelines that guide our litigators and our investigators, when dealing with matters and also to ensure uniformity. We routinely approached the UNODC for assistance. I think the main issues were raised today regarding the differences between conviction and non-conviction based forfeitures. In Namibia and Botswana, we assisted our colleagues working with this judgement, provided clarity on numerous arising from this and we established precedent. So it was a long and detailed mentorship that went through enhanced the peer to peer mentorship. It is ongoing – building of trust in engagement in asset recovery in the region. And we also was very successful in building a regional body of jurisprudence in asset recovery assist legislation throughout the member states. Thank you.
Chair: Angela will be returning later to answer more questions.
Chief of Conference Support Section UNODC Corruption and Economic Crime Section: We are focused on the question of recovery of proceeds of crime, obviously is primarily regarding corruption. You’re all I’m sure aware of or familiar with the Stolen Asset Recovery Initiative, a joint initiative between the World Bank and UNODC, which basically is the cornerstone of our efforts on in the area of asset recovery. I want to stress that we need to have a more strategic approach to this discussion of asset recovery and of recovery of proceeds of corruption. We heard from several speakers this morning about different elements, different regional or global approaches as well as experiences from countries, what we have understood in our engagement with countries in the area of recovery of proceeds of corruption is also the need for a more systemic approach at the national level. If we want to really have more success in this area, we need to understand where we are and where we want to be at the national level and at the global level – we heard this morning from Angela Mae on some information about the kind of lack of data in this area. This kind of picture is very similar in the area of of anti-corruption. We are working on updating our data, but we have data from 2014 that showed that from OECD countries in that six year period only $2.6 billion were frozen in relation to proceeds of corruption – during that same period, the amount that was returned to countries was nearly $423 million. And in comparison with any estimates of these kinds of illicit financial flows of course these were minor amounts. We are, as I said, in the process of updating this data and so far, basically we are not in a good place globally. Given that there are a range of different actors involved at the national level, having a common understanding of capacities and potentials and the issues that inhibits achieving the objectives at the national level is quite important. We all know that at national level, the authorities are dealing with limited resources, so these resources should be optimized and have a more systemic approach of having a strategic approach. There are of course several elements of that – you want to first deprive the criminals of assets or proceeds of crime, you may want to compensate victims of crime, you may want to underme organised crime and create an economically viable recovery system. Also of course, sustain that system itself with the resources that can come from those proceeds for the benefit of the state to society and victims of crime. And finally, of course, to make sure that the public sees that there is accountability and transparency in the system that increases the public confidence. There are several elements that needs to be in place for successful recovery. There are of course different stages in the criminal recovery or in case of corruption, certainly we also look at other alternative mechanisms like civil recovery or non-conviction based forfeature that can also very much be used of course in areas of other crimes. And we are looking at very lengthy processes all more complicated with the requirement of often international cooperation at every stage of the of the process with international cooperation which already complicates that picture even more. We have had of course shorter times, or success cases but typically looking at up to 12 years or more for recovery of proceeds. There are several elements that needs to be in place for that process to work, we need political support and we need legal tools we need institutional capacity, and we need operational capacity. We are lacking a clear Asset Recovery policy, there are legal impediments, we don’t have all the legal tools available, whether it’s on conviction-based confiscation, or extended confiscation that can be useful in some of these cases, whether it’s related to issues of international cooperation, there may be legal impediments, and there are institutional operational limitations. And finally, certainly on the international level, sometimes there are issues of communication very often – unfortunately, sometimes that issue even exists at the national level among different institutions. All this again reinforcing my initial and key point here of the need to have a more systemic approach that brings all the elements that we need to make this happen with clear political will. All of this of course is easier said than done but that’s why we have just set up a global anti-corruption, law enforcement cooperation network, which aims to help precisely with this type of a cooperation among the institutions. To wrap up, important elements are better data, stakeholder involvement, resource allocation and a clear action plan. Thank you.
Canada: The data that was presented was from 2006 – 2012 which is a while back and I look forward to the conclusion of the ongoing collection of data, especially when we’re talking about the trend over time so it was identified. And I’m wondering if you could tell us if there are any obstacles to collecting quality data? What the data collection process and the response rate is?
EU: Thanks for the presentation on the international aspect of asset recovery, as opposed to purely domestic freezing and confiscation. And I was wondering, of course the UNCAC has a dedicated chapter on asset recovery because international cooperation is so important… Would you say that in the field of asset recovery in the context of drug trafficking that is the same problem you know that maybe the majority of the funds are stored in other countries, or is it here maybe some extended lesser problem because we’re dealing more with domestic cases and the assets actually remain more in country?
Mexico: We’ll put basically the same question. Can cryptocurrencies be systematically confiscated? What can we do to establish the proper ownership of those proceeds?
Colombia: You mentioned a very important issue, the issue of trust … not only within the same country but among the other members of the network that is supporting this kind of system for asset recovery. How can we foster this kind of trust within this initiative?
Chief of Conference Support Section UNODC Corruption and Economic Crime Section: First, our distinguished delegates from Canada regarding data collection – it is always a challenge how we do it in this case. And of course, this was raised by Nigeria this morning as well. In 2014, the data was only collected from OECD countries. In 2019, when we started the new data collection, even though it would be more challenging, we decided to do it globally from all member states of the UN, so we sent a note verbal with a detailed questionnaire without any specifics of cases but just to aggregate data and to have some understanding of the mechanisms. The quality of data and the success of this kind of endeavor absolutely depends on what we receive from all of you and that’s why we constantly, regularly, continuously appeal for your cooperation in helping us collect the data that could then in turn, these kinds of forums have more informed discussions of the scope of the problems that we’re looking at. A reminder though – I think it was clear that the data I was referring to was purely on proceeds of corruption, which is not exactly the subject that we are discussing here but nonetheless, I think our success in any of these fields is a reflection is a reflection of the challenges that we’re facing altogether in dealing with proceeds of crime, more generally. So, we, how much response we have received. I believe we received data from around 68 countries. This may have increased by a few now but – it’s not too bad but we of course always hoping for better data, and I have to say that in many cases the response was, we don’t know. We don’t have the data which is itself a valuable response because that also reinforces the point that we need to really make an effort in collecting the data. So thank you very much for that question and certainly we are always welcoming more data, even if it is “We don’t have it “because that itself has value. Second question, from European Union – I would think it depends on also the country context., the landscape, economy and how easy it is to, to hide the money in the country and so on. I think there will always be an interest by criminals to take money away, not only to hide it, but also because often they want to spend it in destinations where they can basically reap the benefits of their enterprise or send their children to boarding schools in another country and so on. In any event there is, most often, an international element, certainly be some financial transaction that goes across the borders but I won’t be able to give an authoritative answer.
Regarding cryptocurrencies I’m not an expert but what I can say is that I don’t see any difference in terms of the legal provisions of UNCAC governing any type of assets. The problem lies with the implementation, and the know-how of the authorities and how to deal with those cases. Crypto went from $10 per coin to 50k per coin so that of course creates its own challenges, but in terms of application of the convention, there’s no problem. And there was a question from Columbia but I haven´t fully understood that.
Mexico: What I meant is that traditionally, the money will have an origin with deposit somewhere, but with the cryptocurrencies, what would be the system to establish the proper ownership…?
Chief of Conference Support Section UNODC Corruption and Economic Crime Section: Legally speaking, any type of asset is covered by those conventions, or for that purpose. Generally, establishing proper ownership is a challenge in many cases because of the old issue of the lack of transparency in the area of beneficial ownership which is an ongoing discussion. If I may go to the last question from Columbia: trust is one of those questions related to political will that we always talk about and it’s not very easy to tangibly define. However, it would say that establishment of these type of different networks and forums is certainly a step in the direction of building more trust because a big part of that trust comes from personal contacts, and a better understanding of what are the real issues that the other side is facing.
Chair: I wonder if you could give a good example where we’re in the asset recovery procedure was expedited somehow? And maybe if you can also name some elements which were crucial to have a good smooth procedure?
Chief of Conference Support Section UNODC Corruption and Economic Crime Section: Unfortunately, the typical cases are on the longer side of the spectrum, most cases we are still even talking about are remnants from the 80´s. there is a Malaysian case however that happened between 2014 and 2015 and it worked exceptionally quick with cooperation from Singapore, Malaysia and Switzerland, were they there was a task force-type of arrangement between these countries that really helped to expedite the process to a point that more than a billion dollars were are returned to Malaysia, and there is a couple of 100 Millions seized in the US. There are different elements in this case that made this happen – investigations for money laundering case related to these assets had already started in some other jurisdictions. And this is a good reminder that in a lot of these cases, you don’t even need to wait for the requesting country to come to you with a request, countries can start their investigations and prosecutions, certainly this was the case here. I think this is very important, that kind of creating an environment where the transnational jurisdictions can really work in tandem. On that point, I want to highlight actually, the set of guidelines by government of Switzerland for asset recovery, which touches exactly on these issues of how to build that trust, how to take these steps in a way that you’re not doing the work separately Thank you. Thank you.
Cindy Guadalupa Mendoza Perez, Director for International Affairs, Ministry of Finance and Public Credit, Mexico: I’m going to present a brief recap on the application of the international legal framework for confiscation of proceeds related to money laundering, as well as the use of financial intelligence to the detection of illicit financial flows from organised crime in Mexico. First of all, regarding the international framework on which the criminalization of money laundering is based on international obligations, related to identification, tracing for short and confiscation of receipts … the Palermo convention that contains identical provisions on the confiscated proceeds of crime or property and also contains identical provision regarding confiscated assets. Much of our work refer to these recommendations that states MS should criminalise, money laundering, on the basis of the Vienna Convention… including legislative measures to enable competent authorities to freeze forces confiscate the proceeds of money laundering. States should establish a Financial Intelligence Unit or a National Centre for analysis of suspicious transaction reports and information relevant to money laundering… dissemination of the results of that analysis. In Mexico, the first national risk assessment was published in 2016, and an update was made in 2020 … was identified as one of the highest rates in the country, and reasons, drug trafficking, the main sources of organised crime in Mexico. In accordance with the identified threats, Mexico has developed a national body to prevent and combat money laundering, and related offences such as drug trafficking. We provide the Attorney General’s office with financial intelligence and technical information submitted by the financial institutions, which allows the Attorney General’s office to inform litigations. Another mechanism is the signing of collaboration agreements for a wider range of export databases to fulfil its mandate to analyze and disseminate quality information regarding money laundering and terrorist finance. We established of economic and material intelligence unit, which is an element of the national security strategy including higher level groups on anti money laundering or terrorist financing, in which several national authorities participate to make policy decisions. And finally, the establishment of interagency working groups for specific cases. This regime is based on the competence of national authorities, and private sector in matters of prevention and combating money laundering. Confiscation of proceeds of crime generally follows a process with the identification and tracking of assets, followed by seizure for future confiscation and concluding with the final exposure … Based on the financial intelligence products that facilitate the investigation and prosecution of the crimes, it is possible for the investigative or law enforcement authorities to seize and confiscate the proceeds of these crimes. The work carried out by the administrative office it is part of the Ministry of Finance as its main objective is safeguard the financial system and national economy from money laundering and terrorist financing through the collection, analysis and dissemination of financial intelligence, therefore use the central National Library is in charge of received suspicious transactions reports of financial institutions, and disseminating intelligence reports and other relevant products to the competent authorities to detect transactions broadly related to money laundering. Therefore, we have developed a risk model to identify transactions related to money laundering by organised crime or drug trafficking groups… to identify connections to other subjects or crimes. In terms of pursuing this model, we identified more than 30 of those SDRs related to over 24,000 subjects from 2020 to September 2021 More than 5000 subjects related to drug trafficking were identified. Furthermore, from 2018 to September 2021, there are currently more than 6000 people on the list of blocked persons, and approximately 200 accounts are blocked. Currently this blocked amount presents to more than 1 billion Mexican pesos, more than 8 million US dollars, and more than 8000 euros. Thank you very much for your attention.
Venezuela: Allow us to explain our position on the relationship on proceeds of crime related to money laundering arising from drug trafficking. We are monitoring the connections between money laundering and drug trafficking. By following the patterns and behaviors of the financial flows that are intended for introduction in our financial system. We have implemented in practice some of the recommendations we are seeing being proposed by some of the distinguished panelists today. On the other side of the spectrum of the financial path, our government is working in ensuring that seized assets are invested into programmed for children and young people through sports culture and musical programmed is strengthening our anti-drug national institution, increasing food production for our citizens that are especially susceptible of being used for illicit purposes. We have seen many good practices are showcased by some countries. My country once against condemns all illegal actions taken against the government. And that is why we will reject all unilateral economic measures for the direct implication of these actions, and in many cases for the overt compliances by some third parties. As we can see these limitations not only affect the Venezuelan population, but they also imply restrictions to access technical assistance, particularly support by donors, international cooperation, peer to peer coordination. And so we ask the international community to grant a solution by rejecting the imposition of these measures in order to avoid this unbearable situation. That is by respecting UN Charter principles of common responsibility, equality, and self-determination of the nation. Thank you very much.
Europol, Economic and Financial Crimes Centre: Before I go into details about Europol´s fight in the fight against financial and economic crime, I would like to say a few words about our mission: to make Europe safer by supporting law enforcement in the fight against terrorism, cybercrime, and other forms and organised crime. As the EU agency for law enforcement cooperation, Europol collects information from ongoing investigations in EU member states and third countries to make connections and find relevant things to provide. We make connections and find relevant links to provide actionable intelligence to member states or for operational partners like Australia, Canada, US, and others. Speaking of our partners, they are of utmost importance and the UNODC clearly plays a very central role in this regard. As of January this year, we have a new Europol external strategy for the period of 2021-2024, which sets the internal framework for external cooperation and the Balkans remains a top priority of this strategy. We have established four centers dealing with specific crime areas. We have a European series organised crime center dealing with organised crime, the European Cybercrime Centre, and the European Counterterrorism Center. Since June last year, we had to establish the Financial and Economic Crime Centre called EFEC. Over the last few years, member states have increasingly expressed their need to receive more support from Europol in addressing and converting economic and financial crime – as we see that complex fraud transnational money laundering schemes, corruption and counterfeiting creasing criminal trends need to be addressed more effectively at the level of the European Union. Consequently, financial and economic crime was one of the priorities identified by our Executive Director, leading to the creation of the new programme. We have enhanced the operational effectiveness and reinforced the support provided to the member states to promote the systematic use of financial investigations, forge alliances with public and private entities. And of course, we support asset recovery by assisting the member states and partake in the CARIN network (?) which is an informal network of practitioners, cooperating and it also makes the regional asset recovery networks. And we all know that money laundering, is a huge threat. Also, globally, we see that the import of cocaine is unprecedented levels of the European Union, money laundering causes massive economic damage, reduces economic growth and distorts economies that also causes damage to the trust that citizens have in our financial system. We all know that trust is the cornerstone of a functioning financial system. We have seen that organised crime is increasingly using violence and corruption is also infiltrating the economy as was the case of a journalist in July in the Netherlands. Developments show in various forms and formats, cash, gold, and increasingly, that was mentioned today as well, crypto currencies… Expensive cars, expensive watches also boats and also including planes, but we believe that we are still scratching the surface, the real money is often beyond the reach of law enforcement. Our estimations indicates that about 7.5 trillion US dollars are parked in the offshore centres on a global level. We assume that a considerable part of it will be linked in one way or the other to srime. Let me give you a brief case example. One of the successes of the cooperative with one member states, leading to the biggest single case seizure. 16.5 million euro found in house searches in various locations. That is an outstanding operation. The criminal organisation took control of one of the largest seaports in Europe, strategically placed between Europe, Africa and South-Central America. Over a period of seven years colleagues working in the field overheard rumours of corruption, they couldn’t work inside the port because criminals were always informed. This criminal group had the total control of the port, important importing large volumes of mainly cocaine. If another criminal group wanted to use the port, they would have to ask permission and pay commission – our operation and the results were tremendous. Besides the cash, a number of arrests were made and about 1.6 pounds of cocaine was seized so the overall value of the assets was altogether 76 point 5 million euros, and that is one operation, very significant one. We know that crime is financially driven and so asset recovery is of course a powerful deterrent in fighting crime. The effectiveness, not on a global level, but also at European level is rather low. We estimated in 2016 that more than 90% of the proceeds of crime were remaining in the hands of criminals. I believe that confiscation rate is increasing, I am confident that the situation will really improve in the coming years. Serious quantification of criminal proceeds is of course difficult as was mentioned already before, and it remains guesswork unfortunately. We have our dedicated Asset Recovery offices established in the 27 member states. They are specialised in tracing, freezing, and confiscating the crime proceeds, and the volume of information exchanged between the recovery offices for the last four years more than doubled. The current network is another example of best practice in asset recovery, cooperating at a global level. Direct and swift cooperation of practitioners at a global level is a prerequisite in improving the overall confiscation figures, and we need to continue our efforts in this regard. And it is also clear that the considerable investment in asset recovery capabilities is needed as a priority to tackle and to prevent organised crime from further undermining our economy and society. So, this was my short intervention, I thank you very much for your kind attention.
Colombia: The issue that concerns us today in the area of confiscation of proceeds of crimes related to money laundering arising from drug trafficking, for Colombia, to address and manage the proceeds of crime is a fundamental part of the comprehensive approach required to combat illicit drug trafficking, as well as to address transnational organised crime in all its forms. We need to fight crime and the profits, derived from it in the national and international context has imposed a challenge to legality and the rule of law. For these reasons, since 2000, Columbia has been an active member of the Financial Action Task Force of Latin-America. And we are active members of the initiatives that seek to address the complex issue of the administration of the proceeds of crime and money laundering. Despite the global trend, the Colombian effort to seize and administrate the proceeds of crimes related to the money laundering arising from drug trafficking continues representing one of the most outstanding aspects of our national institutions. Currently, our Special Assets Society manages around 24,000 properties, 1600 companies, both active and in liquidation, 6000 means of transport, and 8000 livestock. Nevertheless, one of the challenges that we have identified in the administration of these assets, is the long duration of the forfeiture of ownership process, the loss of value of the assets, low productivity of the assets, high administration costs for the state, and even the race for wrongful damage. Faced with this challenge for Columbia, one of the effective mechanisms in terms of administration and management of assets is the early disposal. We also included a legislative reform in that allows certain assets to be sold, such as those that are at risk of destruction, very shareable – thanks to the implementation of this tool, only in 2020, the Special Assets Society of Columbia was able to transfer the accumulate of more than $61 million to entities, such as the Attorney General’s Office, the National Police and in general, to the country’s anti-drug policy. Consequently, the sale and lease of these assets has allowed the state of Colombia to secure a large amount of funds for the recovery of territories, affected by the distribution and commercialization of illicit drugs, to programmes of social inclusion, reduction of the consumption of psychoactive substance, and to degeneration of knowledge, follow up, and evaluation of Colombia’s drug policy. We have to strengthen the bonds of trust and transparency at the regional and global levels in an integral and multi-dimensional approach. This is an appropriate occasion to emphasise the importance of international cooperation, and the promotion of the inter-institutional approachment based on the principle of common and shared responsibility in all the elements that make up transnational organised crimes, and the fight against drug trafficking. It is observed that organisations such as the Colombian National Liberation Army have expanded their illicit activities, including drug trafficking related crimes in the territory of one of our neighbors, which calls itself as just a transit state. But while the reality is that they are providing a safe harbor for such criminal actors that are recognised by other member states as narco-terrorists.
EU: Actually I don’t want to preempt any questions but I thought this would be a good moment to complement your presentation with the statement that we have prepared for the session. Madam Chair, distinguished colleagues, I have the honor to speak on behalf of the European Union and its member states and the following countries align themselves with the statement, the Republic of North Macedonia, Montenegro, Serbia, Albania, Bosnia and Herzegovina, Iceland, Ukraine, the Republic of Moldova and San Marino. Again, we would like to thank you for organizing this intersessional meeting in which we can exchange information on drug supply production and related measures. The illicit trafficking of drugs remains the largest criminal market in the European Union, with an estimated minimal minimum retail value of 13 billion euros per year. It continues to be one of the most lucrative businesses for organised crime groups, more than 1/3 of the group’s active in the EU are estimated to be involved in the production trafficking or distribution of drugs. The sophisticated criminal networks are using a variety of wholesale trafficking activities, as well as mid-level, and retail distribution. The scale and complexity of money laundering activities in the EU have previously been underestimated the confiscation, and recovery of criminal assets is disproportionately small in comparison to the vast proceeds generated through the drug trafficking value chain. One Europol report estimates that only 1.1% of the criminal proceeds were confiscated at EU level. Serious Organised crime in the EU relies on the vast amounts of criminal profits. For this purpose, professional money launderers have established a parallel underground financial system to process transactions and payments, isolated from any oversight mechanisms governing the legal, financial system. This parallel system ensures that criminal proceeds cannot be traced – professional money laundering networks continue to pose a major threat of the European Union. Criminal networks appear to be increasingly outsourcing their money laundering activities. The reasons this could include the desire of criminal networks to distance themselves from the predicate offence, or the need for expert help on how to launder money without being detected. Professional money laundering networks have the expertise and necessary infrastructure to exploit legitimate financial industries and offer a wide range of money laundering services to other criminal networks and in exchange for a fee or commission. Overall, despite robust legislation, the global anti money laundering (AML) framework has a poor success rate in identifying and seizing illegal funds generated by criminal organizations. In many cases, investigations into drug trafficking activities are not complemented by money laundering, or criminal assets investigations. However, efforts to investigate money laundering and dismantle syndicates that specialize in these activities are being strengthened and for the majority of our member states AML is now a national priority. Dedicated money laundering, investigations, the better implementation of AML strategies, and more efficient collection of financial data are expected to enhance the ability of law enforcement authorities to identify illegal funds, funds transfers and increase the number of investigations. In addition, a notable development in this field with the recent European Commission proposal to harmonize AML across the EU, and to strengthen financial intelligence coordination and EU wide supervision, through a new EU authority for anti-money laundering and countering the financing of terrorism. Moreover, to ensure that crime does not pay, the European Commission is working on a proposal for a stronger asset recovery framework with the aim to scale up the capacities and cooperation of asset recovery officers, improve confiscation rates and promote a better management of confiscated cruel assets cooperation through effective multilateralism. The EU strongly supports the efforts to promote coordination between relevant UN entities and regional and international organizations. The EU also highlights the importance of the commitment to the effective implementation of the 3 international drug control conventions. We welcome the continued support of the international community to these conventions and welcome the broad consensus on relevant international human rights instruments. These are the cornerstones of the international drug control system. To conclude, I would like to emphasise that the EU and its member states will continue to contribute to our collective efforts at national, regional, and international levels to accelerate the implementation of our joint commitments to address the world drug situation.. Thank you very much.
Iran: I just want to present a short report regarding the measures taken in my country regarding money laundering. Let me begin with drug seizures in the country during the first months of the year 2021 More than 756 tonnes of different types of drugs were seized in the country. And it shows around 21% more than the same period of last year. The Islamic Republic of Iran has put on the agent as a priority the issue of combating money laundering – a unit known has been set up at drug control headquarters, the State Department seeks to shatter financial foundations of drug trafficking networks, uprooting money laundering activities, and coordinating national measures. A money laundering committee has also been established at the Drug Control headquarters with relevant bodies. Its members led by the state prosecutor. The committee monitors and technically addresses important matters. In this regard, in order to detect and block financial flows related to illicit proceeds in particular proceeds from drug trafficking. My country has taken major steps forward and developing the AML system for one of the most important factors in this regard is the establishment of the financial intelligence unit. The unit is tasked with reception, inquiry, analysis and exchange of information pertaining to suspicious proceeds obtained from criminal activity. The Islamic Republic of Iran has signed memorandum of understanding for cooperation, aimed at combating money laundering and financing with 15 countries in the region and beyond. The unit enjoys greater administrative and financial independence, and more executive power. Finally, we are submitting for implementation an Anti-Money Laundering Act, we are offering training to judges, including methods used by criminals in money laundering activities. And we are translating and publishing contents by research units, and relevant parties.
United States: The United States supports initiatives that address money laundering, and proceeds of crime arising from drug trafficking. But while drug trafficking is a critical piece of the puzzle.It appears through research to be the largest generator of illicit income, it’s important to understand that money laundering is not exclusive to drug trafficking, rather all forms of organised crime generating profits must hide their ill-gotten gains in order to benefit from them and thus rely on and continually evolve their money laundering operations and practices. Member states are encouraged to take full advantage of the 1988 convention which addresses confiscation of proceeds related to drug trafficking crimes and other useful tools to counter drug offences. In addition to the 1988 Convention. The UNTAC and UNCAC have standards and measures related to confiscating proceeds of crime, which may apply in cases involving money laundering and proceeds derived from drug trafficking. Member States should take full advantage of all available tools provided by these conventions to dismantle drug trafficking organisations and prosecute international criminal cases related to money laundering should make concrete efforts to assist each other through effective technical assistance, aimed at building capacity to address these issues, and strengthening information sharing among criminal justice authorities. We look to the UN Office on Drugs and Crime and other relevant UN bodies as well as other expert intergovernmental and multi stakeholder bodies to continue to exchange information on matters related to money laundering to explore ways to increase cooperation among Member States to combat these crimes. The United States is committed to working with partners across the globe to combat the diversion of precursor chemicals, and the laundering of illicit proceeds by transnational criminal organisations which increase the production of synthetic drugs and contribute to the rising number of overdose deaths, implementing the standards put forth from the UNTAC and UNCAC to holistically address money laundering, because many organisations launder proceeds with all kinds of criminal activity. In particular, states should consider non conviction-based confiscation. So, the proceeds controlled by fugitives or criminals who have died, can be forfeited, even without a conviction. This will prevent enriching the associates are families of those criminals. In the United States non conviction-based authorities have been successfully used to combat antiquities trafficking. Most recently, resulting in the confiscation of a rare tablet bearing a portion of the Epic of Gilgamesh considered to be one of the world’s oldest works of literature. This month, the confiscated tablet was repatriated to the Iraqi government. Recent successful uses of non-conviction based confiscation includes the recovery, and the assistance with the recovery of over a billion dollars in proceeds of crime, identified through the United States Department of Justice’s kleptocracy initiatives – investigation which you heard a bit about from the earlier presenter. As a result of these efforts, over $1.2 billion has been transferred to Malaysia, so that they may be returned to benefit the people harmed by corruption. Further, using its non conviction-based authority, in February 2020, the United States Department of Justice confiscated over $311 million in criminal proceeds tied to the corruption of former dictator of Nigeria, for the benefit of its citizens harmed by corruption. United States uses guidelines for its anti-money laundering measures the recommendations of … and strongly encourages other states that have not yet done so, to establish a domestic regulatory and supervisory regime using as a guideline the relative relevant initiatives of regional inter-regional and multilateral organisations against money laundering – as states parties are called to do under the convention. From the presentations thus far at this intersessional meeting it appears that some drug trafficking organisations may be shifting from cash to cryptocurrency. This changes the tools and skillsets needed to follow the money – in drug and money laundering investigations. In addition, the law enforcement community would do well to devote effort to better understanding the business models of drug trafficking groups and other criminal organisations. Thank you very much for the opportunity to make a statement on behalf of the United States.
Kylly Feernandes, President of ARINWA, ASSIMP: In ARINWA, we are 15 countries in West Africa to deal with organized crime, corruption, money laundering, etc that are aggravated by sophisticated criminal matters. Funds from criminal business models in increasing at the rate of tens of billions of dollars that is affecting our social system. That’s why we decided to create ARINWA. So to have recovered assets to combat all this organised crime following the international practice and join CARIN. In 2013, UNODC, had a talk with the government authorities to decide to work with u and in March of 2014, we had workshops and seminars for our professionals. November of 2014, an intelligence network for West Africa was created. Our general objectives include effective recovery of criminal assets, strengthening operational cooperation among members, enhance national coordination, raise awareness and more. We have technical and financial partners across the World. The data is not complete, but we have been collecting since 2018. We have processed 57 application, such as establishment contact with authorities of the member states. Most of our activities is related to seizure, confiscating and asset recovery. We have faced challenges in international cooperation s that is a link to another challenge that we have to collect, analyze and combine data to have a good understanding of the situation but that needs a lot of trainings, setting up more focal points more communication and trust. Thank you very much.
Fitz-Roy Dayton, Professional Development Systems for Financial Investigators, UNODC Regional office in South East Asia and The Pacific: What are we speaking about is the initiatives which are currently taking place to develop financial investigations in Southeast Asia and the Pacific. This has been stated several times today: if you want good quality confiscation cases you need good quality financial investigations. So the framework that we’re looking at relates to Sustainable Development Goals 16.4. But we also have the Financial Action Task Force recommendations and further recommendations that deal with financial investigation, and also the confiscation of assets. So, as far as developing financial investigations are concerned, within this region of the world that UNODC is doing, primarily starts with the establishment of an accreditation service within the country. So, this enables the country to start to determine how its financial investigation training is going to be developed and how it’s going to be delivered as well. The Accreditation Centre also keeps records of all those people that have attended financial investigation training, and the different levels for which that training has been received. In order to enable countries to manage the records, and also to deliver online training, UNODC has developed an online learning management system, and the software is available for countries free of charge. So the new intake of financial investigators will undergo the following process: First of all, they will undertake online training dealing with financial investigation, how to conduct searches, what money laundering means, what it looks like, and also proceeds of crime investigations. The next step then is to attend a practical workshop based around a case study – so theoretical knowledge which has been gained online will be turned into practical skills by the use of these practical workshops. On successful completion of the workshops, the participants now enter a new phase of their training. This phase is mentorship, working with an experienced investigator for a period of a year – they’ll be given tasks that they must complete during the course of the year. On successful completion of that year of mentorship will be the first time that a new financial investigator will be allowed to conduct a financial investigation on their own. What is important about financial investigation is, this is a highly dynamic work. 10 years ago, none of us had heard of crypto currency, and none of us know what criminals are going to be using in 10 years’ time – that means that there is an obligation upon people that are entering the field of financial investigation to keep on top of what the latest developments are. So the next phase, continuing professional development is highly important. Those people that are financial investigators will have an obligation to report every year as to the training that they’ve undertaken and the learning that they have done outside of their work environment, to keep them up to date with the latest developments as far as financial investigation is concerned, and they will be responsible for reporting to the accreditation centre. We are working on engaging a university in Thailand, they will do an assessment of the combination of online training, practical workshops and mentorship and assess as to whether or not that will give an exemption from first a degree, for those that have undergone this process, which means that they will be able to join a master’s programme and pursue their academic studies. We’ve also been approached and asked whether or not this sort of system can be applied to prosecutors that are specialising in financial investigations and recovering the proceeds of crime, and also the judiciary. We have two programmes currently running in the Pacific and Southeast Asia. The first programme is being run in Thailand and Indonesia, and the new programme which was started in October of this year covers, Laos, Malaysia, Philippines, and we’re establishing two centres to cover the Pacific, one in the north and one in the south. So the coverage for this programme is growing quite rapidly. Thank you very much.
VNGOC / Milutin Milosevic, International Drug Policy Consortium (IDPC) : am here as part of the delegation of IDPC, an NGO in consultative status with ECOSOC, but the work I will present today is that of the Drug Policy Network South East Europe. We are a network of 26 member organisations from 11 countries of this region of Europe.The issue of confiscated proceeds of crime related to money-laundering arising from drug traffickingis of great importance for the countries of South East Europe, especially so called Western Balkans Six. Out of 44 countries of the continent analysedby the Global organized crime index(presented here by Dr John Collinsfromthe Global Initiative Against Transnational Organized Crime), eight SEE countries are ranked between second and 14th place by criminality (33th to 92th in the World).More than 80 per cent of the citizens of the region have underlined organised crime as the biggest security threat, while the fight against organised crime is formally on the list of top governments’ priorities.Not only that the region is famous as the “Balkan route” on the drug trafficking line entering Europe, but in recent years criminalgangs from South East Europe more and more control drug production, smuggling and trafficking in Europe, South America and worldwide.Consequently, law enforcement actions against organised crime gangs are numerous, both in the region and in other countries. As drug-related crimes generate tremendousincome, the resultsof these actions include confiscation of significantproperty.The international community actualised the social use of proceeds from crime in the Western Balkans Six, as it did ten yearsago. The approach aims to ensure that property seized by the state from criminals satisfies the public interest and a sense of justice. At the same time, the social use of illicit-gained assets encouraged civil society participation in crime-fighting.There is an agreement in the region that confiscating illegally-gained assets and tracing dirty money are indispensable instruments in fighting organised crime. That’s why parliaments in the previous decade adopted concrete laws on property confiscation under the strong influence of the European Union and the Council of Europe. As a result, the current legal framework in the region is solid.Although there is an agreement, decision-makers have not placed the confiscation of illegally-gained property high on the political priority list. No one in the Western Balkans Six has a specific strategy for confiscating property, but other planning documents cover this area. That is why the situation in practice is different from the law.Institutions for conducting financial investigations and managing seized assets exist but are not sufficiently developed. Capacities for financial investigations are low, which is confirmed by the reports of the European Commission. Financial investigations are often conducted after the arrest, which is not a good solutionbecause it allows criminals to alienate or hide property. I would talk more about the re-use of confiscated assets for social or judicial purposes, which is a growing practice globally. Social and state re-use of assets is an opportunity that is often overlooked by governmentsin the region.We from the civil society, are worried that there are no long-term ways to promote the social use of confiscated property exist in the region. The social use of illicit-gained assets encouraged civil society participation in crime-fighting. The key is to show that property gained through criminal actions can actually serve strengthening society.For now, only two countries of the region have examples where civil society organisations socially use confiscated property.Civil society in Albania has been enabled to propose ideas for confiscating property through social entrepreneurship through a public competition. Three out of 23 proposals passed: KinFolk Coffee Libraryyouth club in Durres, A Buono! Social Pastryin Fierand craft shop Social Craftin Garage in Saranda.In Serbia, people with autism live in confiscatedhouse, while villas are given to organisations that help people with disabilities, children with cancer or young people without parental care. In addition,the property was used by milk and bread factories, agricultural companies and hotels.Unfortunately, we recently noticed lack of transparency around the region related to confiscated property. Last available reports presenting how many houses, apartments, shops, garagesare available for social use are seven and more years old. The institutions that manage confiscated property must be transparent and provide access to records of the seized property so that civil society organisations can apply for use, which requires clear procedures.There are just over 200 civil society organisations in the Western Balkans Six countries fighting crime and corruption. Their role is essential in the command chain of crime prevention and control. They can point out cases, spot institutional weaknesses, offer solutions, and connect relevant individuals, groups, institutions, and organisations.Crime assets could be invested to reduce recidivism, support victims of crime, help people with drug problems and youth,and other activities organised by institutions and civil society organisations. Unfortunately, the key obstacle for implementing drug strategies is lack of resources.Our member organisations, those that address a variety of issues related to drug policy, applied for use of the confiscated property. Not only that they haven’t been given that opportunity, but they even haven’t got a reply to the application!One more issue is usually not part of the reports on confiscated property: cash money that was seized during police actions. It usually goes to national budget which means that it is not wasted. But, wouldn’t it be wise to create a fund of that money that would be used for fighting the problem -to implement the national drug strategies. To conclude, there is a lot of potentials to improve the social use of confiscated property and cooperation between civil society and institutions, not only at the local but also at the regional level. Thank you!
Thailand: Thank you for todays session. In Thailand, the National Assessment on Money Laundering and Terrorism Financing conducted in 2016, showed an asset of 50 million US dollar for more than 100 cases. However, the balances on frozen assets is much less in comparison to the market value … a global leader in drug trafficking. The 1999 Anti-money laundering act in Thailand originated as a result of the Vietnam convention 1988 and anti money laundering law whis states drug trafficking, as a predicate offence. The current draft anti money laundering law will incorporate in depth investigation to increase the value of assets … and technology will be used to enhance efficiency. Thank you very much for your attention and we look forward to working with UNODC and the member country.
Nigeria; I want to thank the presenter from the Asset Recovery Agency Network for West Africa, for a very informative presentation. And I took note of the challenges that she mentioned, trying to train officers and develop action plans to address this challenge in West Africa. I am aware that we have a common position on asset recovery and illicit financial flows, and I would like to ask regarding developing action plan for 2022-2026 that can be guided by these documents? And my second question would be about training officers – how can we have a seamless engagement with the other agencies to share these data to be able to provide this data across disciplines?
Kylly Fernandes: Training is not needed just for the focal point, training is needed for the prosecutors in charge, investigators and overall enforcement … About data, someties we collect them but we don´t use them, so it´s useless. We have to work on advocacy with MS to provide data and work with data efficiently.
Gabriel Andreuccetti, Coordinator at the Center of Excellence for Illicit Drug Supply Reduction in Brazil, a partnership between UNODC, UNDP and the Brazilian National Secretariat for Drug Policies: I represent the Centre of Excellence for short supply reduction, it’s a new cooperation between the Minister of Justice in Brazil, through the secretary of drug during policies, UNODC and UNDP. Our goal is to provide the evidence base analysis for organisations that are trying to reduce illicit drug trafficking in Brazil. We have been going through a true paradigm shift here in Brazil regarding the list of nation framework for asset recovery from drug trafficking. So, since 2019 Brazil has been focusing on dismantling current organisations by reducing their financial structure, all police organisations are concentrated in focusing more on the economic losses in order to provide asset recovery for new drug policies. These changes in the legislation are guided by the UN conventions on the matter. As you can see here, this has become part of the daily news in Brazil. Many types of different operations, tackling the international drug trafficking and many types of types of assets have been recovered and used for improvement of drug policies in Brazil. We implemented the early sale of assets. So, the police doesn’t need to wait for a final court decision before selling the assets from drug traffickers and also enable the organisations in Brazil to sell the assets at 50% of the market value. We also started hiring of entrepreneurs that saw the selling of assets in all 26 states in the Federal District in Brazil. They also established a checking project that was aimed at making faster the process of registration of assets recovered. We moved more than 15,000 assets per year. And nowadays, the last registration number from 2020 was more than 200,000 assets available in the finance system. The system is very complex – We have made an analysis, one of the first bulleting from our centre here, where we note that there are many challenges. The return of these assets to the society is a complex system but we raised more than 24 million US dollars to fund it. This is more than the previous three years. So the increase was substantial. After the assets are seized, they are registered by the police and after that they can be auctioned in an early advanced sale through a process that was created. In conclusion, we can create a positive cycle for increasing the national budget in Brazil specifically for drug policies through the sale of assets in the country. So, going for the global challenge that, that this represents for the country in Brazil: we have also identified that international cooperation, and specifically the interagency network inside Brazil are key for future strategies. We know about the huge impact that in pandemic has imposed. So one of one of the things we have identified is the huge diversification of cocaine exploitation routes coming out from Brazil. This has been raised during 2020, and that for sure is going to represent a huge challenge for money laundering techniques that might also follow this expansion through the many networks that are already in place around the world. I think the real goal here, as we have seen all the presentations, is to reach the criminal organisations economically and so to pave a better future for drug policies. We have a bulleting and also have a video, containing the explanation of all about this complex flow. Thank you.
Senegal: I just want to complement the presentation made by Miss Fernandes. In the last 5 years, there has been improvement – more and more financial aspects are taken into consideration for a better coordination between law enforcement and national authorities. The only challenge remains regarding the number of confiscations as you can see on my slide. I want to highlight that most countries in West Africa work along recommendations and an organized framework. The effectiveness of national systems is a challenge that remains. We use coordinated financial intelligence, but still there is a gap in confiscation of assets. Most countries in the region have specialized divisions and there are more positive results in these countries, so this is something we can highlight as a best practice. We know the challenge about coordination and data sharing already – domestic agencies are rarely talking to each other, so we set up an intelligence agency community to connect these units. We encourage best practices and operationalizations of regional networks.
Brazil: I just want to compliment actually the work the office has been doing Brazil and we want to make it public, that we will increase our efforts to work with other MS.
Peggy Chukwuemeka, Parent-Child Intervention Centre, Nigeria: I am here as part of the delegation of World Federation Against Drugs (WFAD), an NGO in consultative status with ECOSOC, but the work I will present today is that of Parent-Child Intervention Centre (PCIC). PCIC is an NGO in Nigeria working in the areas of Drug and substance abuse prevention, Mitigation of Sexual and Gender based violence and Good Governance. PCIC is a member of WFAD, Civil Society Network on Substance and Drug Abuse Prevention, Nigerian Network of NGOs and more. There is a close relationship between money-laundering, drug trafficking, corruption and other forms of organized crime, including trafficking in persons, trafficking in firearms, cybercrime and, terrorism and financing of terrorism. This poses a significant and growing threat to national and international security, with dire implications for public safety, public health, democratic institutions, and economic stability across the globe. Not only are criminal networks expanding, but they also are diversifying their activities, resulting in the convergence of threats that were once distinct and today have explosive and destabilizing effects. Drug trafficking is the cultivation, manufacturing, distribution and sales of prohibited drugs while money laundering is the illegal process of making large amount of money generated by a criminal activity such as drug trafficking. Drug traffickers have derived ways of launder drug money and the process generally involves three basic stages. The first stage, placement stage which has to do with disposal of the drug proceeds into domestic banks and foreign financial institutions. The second stage is the layering stage, which involves moving funds between multiple financial institutions to hide their source of making money to cover up the audit trail. The third stage is the integration stage and at this stage, a legitimate justification for the funds is produced. This can be done through false invoicing, purchase of financial instruments like stocks or investment in real estate, tourism, and other legitimate businesses.There are quite number of methods to conceal the large sums of currency that are generated by illicit drug sales. Another method is the structuring method which also has to do with breaking up of large amounts of cash into transactions that amount to less than $10,000 to avoid currency-reporting requirements.Other laundering methods are also through casinos, wire transfer companies, and smuggling currency out of the United States.Despite numerous laws, treaties, multilateral agreements, and public pronouncements, large-scale trafficking and money laundering continues because the demand is high, profits are enormous, and detection is difficult. However,the detection of money laundering is impeded by various national laws that protect financial, communication, and data privacy. In a significant number of countries, bank secrecy laws hinder obtaining comprehensive information about financial transactions by prohibiting banking officials from releasing customer information to persons outside the financial institution, or simply by prohibiting access by foreign law enforcement agencies on the grounds of national sovereignty. Additionally, under data protection laws such as the European Union’s Data Protection Directive, information may be prohibited from leaving a signatory country if it is being sent to a country with less stringent data protection laws. Most illicit drugs are grown and processed in poor countries where economic opportunities are scarce, law enforcement is weak, and officials can be bribed or eliminated. The globalization of trade, finance, and communications has made it easier to transport illicit drugs and launder the proceeds and Nigeria remains one of the major drug transshipment point and a significant center for criminal financial activity.Individuals, such as internet fraudsters, corrupt officials and businessmen, as well as criminal and terrorist organizations take advantage of the country’s location, porous borders, weak laws, corruption, inadequate enforcement, and poor socioeconomic conditions to launder the proceeds of illicit drugs. The proceeds of illicit drugs in Nigeria arederivedlargely from foreign criminal activity rather than domestic activities. Drug traffickers reportedly use Nigerian financial institutions to conduct currency transactions involving U.S. dollars derived from illicit drugs.Money laundering in Nigeria takes many forms, including: investment in real estate; wire transfers to offshore banks,political party and campaign financing,deposits into foreign bank accounts andbulk cash smuggling.Parent-Child Intervention Centre (PCIC) as anNGO with focus on Drug and Substance abuse prevention in Nigeria has not only beenworking with the NationalDrug Law Enforcement Agency (NDLEA)we are alsoworking in partnership with theNigerian Economic and Financial CrimesCommission (EFC). This is because we know that drug trafficking and money laundering will be reduced if demand for illicit drugs is reduced in consumer countries like Nigeria. In the cause of our work in Nigeriaas an organization, we have also carried out activities in partnership with HEDA Resource Centre in the tracking of illicit financial flowsby the Nigerian elites. PCIC and HEDA are working towards training and involving Nigeria University students to also get involved in tracking of the illicit finial flows in Nigeriaand we are optimistic that if the Nigerian Government will be more serious in prosecuting the offendersof both drug traffickingand money laundering, there will be reduction in crimes and terrorism funding.Our Recommendations: We understand that a wide variety of social factors ensure that drug trafficking and money laundering will continue to thrive for the foreseeable future and money laundering is difficult to detect because of the high volume of banking transactions and because laundered transactions largely resemble legitimate commerce.And we thereforerecommend thatdomestic and international anti-money-laundering cooperation and regulationsbe strengthened.There should be an increaseinfunding for treatment, prevention, and economic development programsto reduce drug production, sales, consumption, and trafficking.Thank you
.Chair: Thank you. We reconvene tomorrow.