Illegal wildlife trade latest form of money laundering

Proceeds estimated at USD 23 billion per annum Botswana, China, UK co- led this work

To date most countries rarely focus their efforts on Illegal Wildlife Trade ( IWT) despite billions of dollars in profit generated through this crime, the latest findings by the Financial Action Task Force ( FATF) shows.

Botswana is among countries affected by illegal poaching and spends handsomely in protecting wildlife as it is among the largest GDP earners.

FATF is not only concerned about the lack of financial focus on the illegal wildlife trade, but that IWT is a major transnational organised crime that fuels corruption, threats to biodiversity, and can have significant public health impacts, in particular, the spread in recent years of zoonotic diseases.

It further urges countries about the importance of ensuring that wildlife is traded in a legal, safe and sustainable manner, and that countries remove the profitability of illegal markets.

In its latest and first global report dubbed ‘ Money Laundering and the illegal wildlife Trade’, FATF - the global standard setter on anti- money laundering ( AML), countering the financing of terrorism ( CFT) and countering proliferation financing ( CPF) - is concerned about the lack of focus on the financial aspects of this crime, and related money laundering.

FATF has now provided a useful framework for countries to address threats by strengthening their national laws, policies, and co- operation at the domestic and international level. At its June seating, Botswana passed several Bills covering wildlife.

FATF findings in their study make a unique contribution by assessing the money laundering ( ML) aspects of wildlife crimes, and by demonstrating how jurisdictions should apply the FATF standards to combat IWT.

The findings are based on inputs from around 50 jurisdictions across the FATF Global Network, as well as expertise from the private sector and civil society. It urges jurisdictions to view the proceeds generated by IWT as a global threat, rather than a problem only for those jurisdictions where wildlife is illegally harvested, transited, or sold.

In particular, criminals are frequently misusing the legitimate wildlife trade, as well as other import- export type businesses, as a front to move and hide illegal proceeds from wildlife crimes.

They also rely regularly on corruption, complex fraud and tax evasion. The growing role of online market places and mobile and social media- based payments to facilitate movement of proceeds from wildlife crimes is also tackled in the study.

These trends highlight the increasing importance of a coordinated response from public authorities, the private sector and civil society to identify and disrupt financial flows from IWT. FATF has found that despite IWT’s global impact, public and private sectors in many jurisdictions have to date not prioritised combating the financial flows connected to IWT in line with risk. Jurisdictions often do not have the knowledge, legislative basis, and resources required to assess and combat the threat posed by these funds.

This limited focus on the financial side of IWT has largely prevented jurisdictions from being able to identify and sanction IWT networks.

FATF argues that to address these challenges, jurisdictions should consider implementing good practices amongst them to prioritise combating the financial flows associated with IWT proportionate to risk.

Statistics

FATF states that according to the 2016 UN World Wildlife Crime report, criminals are illegally trading products derived from over 7 000 species of wild animals and plants across the world. This includes iconic mammals, but also lesserknown species of reptiles, birds and amphibians. To reflect the serious nature of this crime, the UN General Assembly has adopted several resolutions to combat IWT, and in September 2019, reiterated its call for all members “to amend national legislation, as necessary and appropriate, so that offences connected to IWT are treated as predicate offences for money laundering ( ML)” -( UN General Assembly Resolution 73/ 343) Organised crime

The report states that criminal syndicates involved in wildlife crime continue to be highly organized, and are often involved in other forms of serious crime. For example, the large- scale ivory seizures and mixed shipments of multiple protected species suggest that transnational syndicates are continuing to grow and diversify. Wildlife traffickers also continue to rely heavily on the bribery of officials ( rangers, customs agents, prosecutors, and judges), as well as complex fraud and tax evasion, to enable their crime. Several investigations provided for this study showed convergence between IWT and transnational drug trafficking networks and/ or illegal logging and associated trade ( ILAT). However, the convergence of IWT with other types of transnational organised crime appears to take place only occasionally.

Methodology

The President of the FATF made tackling financial flows from IWT a priority area for the Chinese Presidency of the FATF ( 2019- 2020). Based on that delegations from Botswana, China and the United Kingdom co- led this work. The project team for this work included delegations from 18 countries, alongside representatives from CITES Secretariat, Egmont Group of FIUs, EUROPOL, IMF, INTERPOL, UNODC, and World Bank, United for Wildlife ( UfW) Financial Taskforce and five non- profit organisations ( NPOs).