Financial Transparency Coalition

Washington, DC -- Developing country treasuries are losing approximately $100 billion dollars every year due to trade mispricing, according to a new report available today from Global Financial Integrity (GFI).

Yesterday's US Senate Homeland Security Committee hearing on the Incorporation Transparency and Law Enforcement Act, which featured Tax Justice Network-USA Chairman and Global Financial Integrity Advisor Jack Blum, is now available online on the Senate.gov website. Check it out below: Full resources from the hearing can be downloaded from the Senate website here...

Illicit financial flows exit developing countries through two broad channels—as unrecorded capital flows from a country’s external accounts (captured by the World Bank Residual model) and trade mispricing (captured by the Direction of Trade statistics or DOTS model). GFI’s study Illicit Financial Flows from Developing Countries: 2002-2006 points out that some researchers have questioned the use of the trade mispricing model to capture illicit flows. They argue that data issues underlying the recording of partner country exports and imports introduce enough “noise” so that the trade mispricing model is unable to capture illicit flows. I was therefore...

My week in DC is not yet over: I have some meetings still to do, but my on-line week nearly is. I admit it’s too early to appraise all that has happened. But I’ll offer first thoughts. First highlight: World Bank MD Ngozi Ikonjo-Iweala calling for mass civil society action against illicit financial flows. Has the Bank got the issue? I think so. Second, constructive dialogue with the Oxford team. I hope we can build on it. Third, clear rejection of the view put forward by some economists that data prevents analysis of this issue or that there is even...