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Illicit Trade

Converging Criminal Networks

In series:OECD Reviews of Risk Management Policiesview more titles

Published on April 18, 2016

book

This report assesses the magnitude, flows and drivers of illicit trade and the illegal economy including: narcotics, human trafficking, wildlife, sports betting, counterfeit medicines, alcohol and tobacco. The negative socio-economic impacts that these markets have in consumer countries are as worrisome as the goverance gaps that are exploited in source countries. This report examines each illicit sector in terms of the geographic sources, destinations and key trade routes, the current trend of infiltration by organized crime networks, and good practices or future policy solutions with which to combat illicit trade within the various sectors.

TABLE OF CONTENTS

Foreword
Preface
Executive summary
Illicit trade
Trafficking in persons
Wildlife trafficking trends in sub-Saharan Africa
Illicit trade in counterfeit medicines
A brief overview of illicit trade in tobacco products
The global illicit trade in illegal narcotics
The size, impacts and drivers of illicit trade in alcohol
Sport manipulation as economic crime
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at a glance

Illicit trade involves goods & services that are deemed illegal as they threaten communities and society as a whole.  Illicit trade has a negative impact on economic stability, social welfare, public health, public safety & our environment - examples include:

  • Health & Safety - narcotics, fake medicines & foods, defective materials.  
  • Environment - endanger wildlife & rainforests through illegal environmental crimes.
  • Exploitation - forced human trafficking, prostitution and slavery.
  • Terrorism - financing criminality and terrorism.
  • Government - reduction of tax revenues & legitimate employment.


GLOBALISATION 

  • Globalisation has fundamentally changed the business opportunities for criminal entrepreneurs.
  • Geographic scope, volume & range of illegally traded goods have increased their negative, economic & political impacts.
  • Criminal networks have acquired a global outlook for new illicit markets.


TECHNOLOGY

  • Illicit networks have adapted to the latest technology to commit crimes such as cyber extortion.
  • Social media networks are used to identify new clients and make payments.


SPORTING EVENTS

  • Globalisation of sporting events has led to an increase in unregulated sports betting.
  • Betting on sporting events is increasingly used for money laundering and is connected to corruption in sport.



     

THE FIGURES

  • Profits of international organised crime are as high as USD 870 billion - 1.5% of global GDP (UN).
  • Half of these profits laundered through global financial system (UN).
  • 20.9 million people forced into slavery worldwide (ILO).
  • Counterfeit medicine worth USD 200 billion a year (OECD, 2010).
  • 50% of the proceeds of crime come from drug trafficking, 40% from counterfeiting activities.
  • 570 billion illicit cigarettes consumed in 2011.
  • 25% of worldwide alcoholic consumption comes from illegal sources.


OECD TASK FORCE ON COUNTERING ILLICIT TRADE

To mitigate this global risk, public and private sector decision makers need a firmer understanding of the magnitude and nature of its impacts on economic activities, and a clearer understanding of the conditions that enable it.

The OECD Task Force on Countering Illicit Trade focuses on evidence based research and coordinates international expertise in quantifying and mapping illicit markets.

 

Quantitative metrics better inform policy makers to:

  • drive criminal entrepreneurs out of business,
  • reduce incentives to enter illegal markets,
  • reduce the opportunities for organised crime to enter the financial system,
  • help governments sustain legitimate markets.


Mapping tools
allow policy makers to address gaps in surveillance & monitoring systems to develop more effective early detection and warning systems.

 

 

 

 

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further reading