Financial Crime

What is Financial Crime?

Financial crime is a crime committed against property involving the unlawful conversion of property ownership to one’s benefit.

The scope of this term delineates illegitimate operations that harness financial systems, services, or tools, mostly with an intent to derive unlawful benefits. The spectrum of financial crimes is extensive, ranging from money laundering and fraud to embezzlement, insider trading, and even encompassing the realm of cybercrime.

Generally, these offenses are pursued by individuals or colluding groups, intending to amass wealth from illegal endeavors such as narcotics trafficking, human smuggling, or acts of terrorism. The ripple effects of financial crimes are grave and far-reaching, provoking economic unrest, eroding public confidence in financial establishments, and undermining the foundation of legal systems.

Addressing the complex and dynamic challenge of financial crime necessitates a comprehensive, multi-pronged strategy. Key players in combating this menace include law enforcement officials, regulatory entities, and financial institutions. Effective deterrence measures against financial crimes entail fortifying anti-money laundering and counter-terrorist funding norms, amplifying international collaboration, and capitalizing on technology and data analysis to spotlight dubious activities.

Over the last 30 years, financial crime has become a major concern to governments worldwide. The concern arises as the effects of financial crime vary. Today, the occurrence of financial crime is a threat to economic development and stability in many societies.

INTERPOL established the Financial Crime and Anti-Corruption Centre (IFCACC) to respond to the rise of financial crime and coordinate international responses.

What are the Different Types of Financial Crime?

These include:

• Fraud such as email compromise fraud, payment card fraud, air ticket fraud;
• Money laundering;
• Terrorist financing;
• Cybercrime;
• Bribery and corruption.

Financial Crime Issues

The possibilities of making money illegally seem endless from the different types of financial crimes. The people who commit these crimes feel the risks are low while returns are high. Financial crime can be small-scale or large-scale.

Small-scale crimes include basic theft and fraud, while large-scale operations have a footing on every continent. However, these crimes should not be taken lightly, as their social and economic effects link to crimes such as terrorism.

As digital technology grows, so do financial crimes. Criminal gangs operate through countries to avoid detection. INTERPOL comes in to coordinate international responses to help curb this global issue.

Interpol’s Pivotal Role in Combating International Financial Crimes

International financial crime is a significant concern for governments, businesses, and individuals worldwide. These crimes often involve complex networks and span across multiple jurisdictions, making it challenging to detect, investigate, and prosecute the perpetrators. Examples of international financial crimes include money laundering, tax evasion, terrorist financing, and cross-border fraud. As globalization continues to expand and technology advances, the opportunities for criminals to exploit the global financial system grow, posing a considerable threat to the stability and integrity of economies around the world.

Interpol, the International Criminal Police Organization, plays a crucial role in the fight against international financial crime. With 194 member countries, Interpol serves as a global platform for information sharing, coordination, and cooperation among law enforcement agencies. By facilitating real-time communication and intelligence exchange, Interpol enables member countries to work together in identifying, tracking, and apprehending criminals involved in international financial crime, even when they operate across multiple jurisdictions.

Interpol’s efforts in combatting financial crime are bolstered by specialized units and initiatives, such as the Interpol Financial Crimes Unit (IFCU) and the Global Focal Point Initiative. The IFCU provides support and expertise to member countries in investigating complex financial crime cases, including money laundering and asset recovery. The Global Focal Point Initiative, on the other hand, focuses on asset recovery by fostering collaboration and information exchange among asset recovery practitioners from different jurisdictions.

In addition to these initiatives, Interpol also works closely with other international organizations, such as the International Financial Crime Analysis and Coordination Center (IFCACC) and the Financial Action Task Force (FATF), to develop strategies and best practices to prevent and counter international financial crime. By coordinating efforts and leveraging the collective expertise of law enforcement agencies and international organizations, Interpol plays an indispensable role in the global fight against financial crime and the pursuit of a more secure and stable international financial system.

Role of INTERPOL in Fighting Financial Crime

Financial crime has grown rapidly in recent years, impeding economic growth and causing losses to businesses and individuals. In addition, corruption complicates the financial crime issue creating a great opportunity for organized criminal activities.

The tactics of the criminals advance as globalization and digitization of processes continue to take effect. As a result, they modify their methods to seize new opportunities to defraud businesses and individuals.

There is a need for an immediate response to these crimes, and INTERPOL IFCACC is up to the task. IFCACC helps coordinate international responses. The program helps expand the existing initiatives for tackling financial crime, asset recovery, and illegal money flows.

The IFCACC works closely with key stakeholders to help in solving financial crime. These stakeholders include the financial sector, police organizations, law enforcement agencies and other financial task forces.

Capabilities of IFCACC

Some of the IFCACC capabilities include;

• Investigative Support- IFCACCS’s job is to support member countries by cross-checking data against the database provided by INTERPOL. It will help provide case mentoring and global support. 
• Analytical support- The IFCACC will focus its efforts on any emerging criminal threats through the Financial Crime Analysis File. The center works with member countries to strengthen the tactical response to internationally organized criminal activities.
• Operational support- IFCACC will coordinate global operations and action days against global financial crime threats. They will deploy their operational support team to help in ongoing investigations of the member states.

Final Thoughts

Financial crime threatens businesses and individuals in all aspects of their lives. Additionally, it’s detrimental to the economy and causes huge losses to businesses and companies. Therefore, there is a need to curb financial crimes as they go beyond social and economic effects.

Kendall Coffey

Senior Partner

Mr. Coffey is a former U.S. Attorney, Southern District of Florida (1993-1996); and served as Chair of, the Southern District Conference, Florida Federal Judicial Nominating Commission (April 2009 – January 2017).

Phone:

+357 25 059 684

Email:

[email protected]

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