Financial Transparency Coalition

“Coffee shops” are causing trouble and increasing crime rates in small Dutch towns that border neighboring countries. To some degree it’s drug tourism, visitors coming from other countries to engage in infamous Dutch, legal pastimes. However, these “coffee shops” that sell drugs are also facilitating the expansion of organized crime and of the underground economies both in the Netherlands and in neighboring states. As the underground economy grows, the government’s ability to govern slowly erodes, and the bigger fish become harder to track and catch. While drug tourism is a small problem compared to, for example, a corrupt African official...

A few weeks ago, the U.S. upped its economic sanctions on North Korea, trying to block the rampant illegal activities taken by, or on behalf of, the political elite of the state. Kim Jon Il manages his regime, in part, by using government resources to funnel exotic, luxury goods – jewelry, cars, yachts – to his large ring of cronies. This abuse falls directly under the broad definition of illicit financial flows (IFFs) as unrecorded funds and goods promoting illegal activity. Serious corruption and continued illicit activity within North Korea is becoming a larger threat to global security. These...

Central Bank Governors met in Basel, Switzerland earlier this month and proposed tripling the capital reserve requirement to 7 percent. This came shortly after the Financial Stability Board and Basel Committee for Banking Supervision released a joint statement that said that the benefits of implementing stronger capital and liquidity requirements – which increase the safety and soundness of the banking system – would have net, long-term benefits for the global economy. Many banks argue that having to comply with higher capital requirements by holding onto more of their money would hamper economic development and slow...

Cumulative Illicit Financial Flows out of India from 2000-2008 Total Over US$125 Billion

India’s economic boom continues with an average growth rate of over eight percent between 2004 and 2009 by GFI calculations. As the money flows, however, the poor continue to stay poor. Corruption is rampant in India as it is in almost all developing countries. Both corrupt political and corporate officers manage to siphon off funds – intended to aid the people of India – off to political and private sector elite. Recent efforts in India to challenge this corrupt affront on humanity have been met with severe...