The book provides the first collection of analytic contributions, as opposed to advocacy essays and black box estimates, on illicit financial flows (IFFs). Some of the chapter presents new empirical findings; others, new conceptual insights. All of them enrich the understanding of the dynamics of the illicit flows phenomenon. The book does not offer a new estimate of the global total of these flows because the phenomenon is too poorly understood.
While cocaine production ravages countries in Central America, consumers in the US and Europe are helping developed economies grow rich from the profits, a study claims. The vast profits made from drug production and trafficking are overwhelmingly reaped in rich "consuming" countries – principally across Europe and in the US – rather than war-torn "producing" nations such as Colombia and Mexico. And its authors claim that financial regulators in the west are reluctant to go after western banks in pursuit of the massive amount of drug money being laundered through their systems.
Last week, managers from Britain's biggest bank, HSBC, lined up before the Senate's permanent sub-committee on investigations. Europe's largest bank ignored warning signs about money-launderers. The notion of any dichotomy between the global criminal economy and the "legal" one is fantasy. Worse, it is a lie. They are seamless, mutually interdependent – one and the same.
A settlement deal with the British banking giant HSBC is the ultimate insult to every ordinary person who's ever had his life altered by a narcotics charge. Despite the fact that HSBC admitted to laundering billions of dollars for Colombian and Mexican drug cartels (among others) and violating a host of important banking laws (from the Bank Secrecy Act to the Trading With the Enemy Act), the Justice Department elected not to pursue criminal prosecutions of the bank, opting instead for a "record" financial settlement of $1.9 billion, which as one analyst noted is about five weeks of income for the bank.