Flying Money | Investigating Illicit Financial Flows in the City.
In May 2018 the Institute of Network Cultures co-organized the European conference Flying Money together with the city of Amsterdam.
Global developments in digital currencies and monetary flows are taking place at breakneck speed. Blockchain, cryptocurrencies, the emergence of parallel banking systems and the decentralization of monetary transactions impact ideas about the future of money and the banking system, but they also expand the playing field for criminals.
Many cities are increasingly confronted with suspicious investments in real estate, hotels, restaurants, clubs, and other businesses. This phenomenon is particularly urgent in global cities like Amsterdam, where many different monetary flows converge.
This European conference had a unique nature and scope. It brought people together from a wide range of backgrounds – civil servants, scientists, engineers, journalists, artists, bankers and entrepreneurs – to discuss topics related to the future of digital money, and illicit financial flows in particular.
To address these themes more than 40 speakers were invited, including Bill Browder, Eric Smit, Francesca Bria, Bastian Obermayer, Klaas Knot, Misha Glenny, Joris Luyendijk, Saskia Sassen and Galia Benartzi.
*not all talks were recorded*
- Tom van Engers
- Rob Procter & Andrew Elliot
- Rob van ‘t Oever
- Jonathan Brown
- Anita van Dis
- Eric Smit
- Panel discussion
Session: The future of money
Kei Kreutler is a designer, developer and researcher. She is currently Creative Director at Gnosis, a platform for information discovery on the Ethereum blockchain, and curates the events program at Full Node, Europe’s largest coworking space for blockchain companies.
The talk will approach how we can model and interact with complex systems through game design. Through the lens of Patternist, an urban augmented reality game, the talk will explore the concepts of networked barter, nanobarter, and decentralized exchanges, focusing on the implications of digital currency to transform how we mediate and socialize value.
Saskia Sassen is the Robert S. Lynd Professor of Sociology at Columbia University and a member of its Committee on Global Thought, which she chaired until 2015. She is the author of eight books, of which Expulsions: Brutality and Complexity in the Global Economy (Harvard University Press, 2014) is the most recent.
New financial instruments make it possible to dissolve material elements, including massive high-rise buildings, into liquid instruments. Once liquid they can be bought and sold continuously. Moreover, the most recent innovations can make an empty building even more valuable than an occupied one: with new types of asset-backed securities perhaps the most-used innovation. Much of this is invisible to the human eye: we just see an empty building and pity the owner. That may have been the case until quite recently, but not nowadays: an empty building can bring even more profit because the structure we see with our eyes is no longer what is in play – it has in fact been transformed into liquid assets. These are predatory formations of a new sort.
Session: Who owns the city?
Joris Luyendijk is an author and journalist, and a regular contributor to the British newspaper The Guardian. Lately, his focus has been on morality and finance, the culture in big banks, the political response to the financial crash of 2008 and the danger for regulators, academics and journalists of being “captured” by the industry they are assigned to.
Financial districts are worlds in their own right. Boasting their own peculiar forms of architecture and social norms and habits, they lock their employees into a universe that many struggle to escape. If we are to reintegrate the financial sector into our societies, reorganising its physical shape and form as well as its social structure and rituals is essential.
Jan Willem Bastijn is CEO, EMEA Capital Markets, at Cushman & Wakefield. He focuses on pan-regional investors and crossborder investment transactions. Bastijn is based in the UK but works closely with other teams to strengthen relationships with major pan-European investors operating across several markets.
The global property market is highly connected and the Netherlands plays a key role, both as a target and a source of investment. While sometimes tempting to see those involved as a dominant elite, in reality most are acting on our behalf, investing for pensions and other savings needs. As such, they have a lot of investment options and real estate must compete for attention. And it is critical to cities like Amsterdam that they do this, because their investment helps to modernise and create jobs. At the same time, while the large institutions that control the market have made it more accountable than ever before, unfettered, they may not deliver for society at large and it is therefore critical that governments guide but also innovate in new areas such as big data for example.
Tinkebell is an artist and a writer. She calls herself a “storyteller and maker”. She has written several books, works as a columnist, makes films, performs public interventions, delivers lectures and produces art “on-thespot”, but also shows her work at galleries and museums.
What happens at the Amsterdam Zuidas, stays at the Amsterdam Zuidas. This used to be true when it comes to tens of thousands companies who made use of the Dutch laws to evade tax in this beautiful city. Until artist TINKEBELL. started to read herself into the subject and started ‘Kamerplanttours’: a (bus or bike) excursion that leads people through the Zuidas jungle. Since words are spread, for some companies, things will never be the same.
Caroline Nevejan is a researcher and designer who has been involved with the emerging network society and digital culture since the 1980’s. Nevejan is a regular presenter at national and international fora. She is an advisor to national and European policy makers. Caroline Nevejan is professor by special appointment with the Amsterdam School for Social Science Research, University of Amsterdam (2018-2023). Her research is focused on Designing Urban Experience and she supervises 5 PhD candidates in this context.
Panel discussion Who owns the city?
Session: The meaning of crypto in the city
Marloes Pomp is initiator and Program Officer for the Blockchain Projects of the Dutch government, and also responsible for the international strategy of the Dutch Blockchain Coalition. In order to establish the precise opportunities and threats associated with blockchain technology, Marloes has launched 35 pilot projects within the government.
After a brief general introduction to blockchain and cryptocurrencies, this presentation examines what part the Dutch government has so far played in the development of blockchain technology. Where are there opportunities for the Netherlands, and what are the challenges? What does the country hope to achieve in the coming year, and are the EU’s plans?
Mariana Gomez de la Villa is Global Program Manager, Distributed Ledger Technology, at ING Bank. She is also the global head of ING’s Blockchain Program, with overall responsibility for driving the research and development of distributed ledger technology as well as capitalising on its potential in order to unlock mass-scale value.
Examining the application of blockchain, or any distributed ledger technology, within an entity such as a city requires us to address the potential benefits alongside existing challenges. From the experience ING has gained so far, DLT surpasses existing systems in terms of speed, security and cost. DLT can be applied in several ways to combat illicit financial flows. Self-sovereign identity and localised currencies can potentially reduce money laundering, improve compliance, increase transparency and provide a better overview on the flow of money. Nevertheless, a number of hurdles still exist when it comes to the implementation of DLT within both the financial sector and local-government level. This presentation will provide an overview of DLT, what can be achieved and what remains to be done.
Denis Roio, better known by the hacker name “Jaromil”, is cofounder and CTO of Dyne.org, an Amsterdam-based software house and think-and-do tank known worldwide for developing and distributing free, open-source software with a strong focus on peer-to-peer networks, social values, cryptography, disintermediation and sustainability.
It is 2018 and the logic of financialised and systematised production has occupied the terrain of both social relations and creativity. Post-Thatcher, or perhaps we should say post-Kroes, the “creative” industries’ neoliberal ideology has put private capital in the driving seat while at the same time cuts are being applied to public spending. Speculation has become the main vehicle for value production: a means very familiar to organised crime worldwide. Criminals comply well with both corporate and state apparatuses. New media technologies are being developed with a traumatised agenda in mind: scenarios of journalist assassinations and fundamentalist regimes worldwide are filling our news feeds, urging us to develop technologies that can protect minorities from prevarications and persecutions. As predicted by many, war is no longer only being played out on the battlefields. Cyberwarfare has entered everyone’s home, cryptography can be a toy in the hands of kids – and there is nothing we can do, nor should do, to stop this. The arms race to pervasive surveillance and privacy-enabled technologies is empowering every player on the battlefield, whilst reducing social relations to axiomatic equations of technical, financial and institutional power. But while policymakers are hardly able to keep up with the growing complexity of regulatory side-effects, there is a heritage of social justice movements we can consider the best possible solution to the growing problems of fair, social and peaceful government.
Stefan Heidenreich currently teaches at the University of Cologne, having previously worked at ETH Zürich, Dusseldorf Art Academy and Leuphana University Lüneburg. He has published books on economics (Geld: Für eine non-monetäre Ökonomie, 2017; English edition to appear in 2018 as Money: Toward a Non-Money Economy.), cultural history (Geburtstag: Wie es kommt, dass wir uns selbst feiern, 2018) and art (Was verspricht die Kunst, 2009).
Desire and distribution – Economics is about sharing things and tasks. It deals with matching goods or services, demand and supply, desires and skills. At present, this matching is co-ordinated mainly through money and markets. But with increasingly precise data available on behaviour and personal desires, other types of matching are now becoming feasible. In a not-too-distant future, “smart” and algorithmic procedures may become more effective than markets and money, not only when it comes to transaction costs but also in terms of results and equality. Cryptocurrencies will not add much to this future, but cryptocontracts may play a role in facilitating decentralised transaction flows. Local communities could take the lead in this transition, although personally I would rather look to gaming as main driver of change.
Meaning of crypto in the city panel discussion
Session: Parallel money structures in the city
Edgar Kampers is founder, ICO adviser to and a public speaker at Qoin, a social enterprise that creates, develops and supports impact-driven currencies and blockchain initiatives.
City tokens support building vibrant local communities that allow citizens, businesses and local stakeholders to cocreate and codeliver meaningful social, environmental and economic impact. The city, community groups and/or the business community can take the initiative to launch these currencies. The euro is not a given. It and the other currencies we use are essentially a choice of governments. Euros are created by commercial banks through debt, a system that relies on interest to repay the money issued. Since money is man-made, it can be reinvented to positively serve our individual and collective needs. City tokens are designed to sit alongside mainstream fiat currencies, to address objectives the conventional fiat system cannot. The development of city tokens gained momentum after the financial crisis of 2007- 2008, which led to social impoverishment and unemployment in many cities in Europe. The invention of blockchain and other technical solutions further increased the opportunities. Setting up a city token is a dynamic process. Where do you start? How do you actually create a new currency? How do you make sure it meets legal and fiscal requirements? How do you deploy an effective, reliable and secure IT platform and payment system? And finally, how do you actually run a city token successfully?
Nikos Passas is Professor of Criminology and Criminal Justice at Northeastern University. He is the author of more than 230 publications on corruption, illicit financial and trade flows, sanctions, informal fund transfers, remittances, terrorism and financial regulation. He is a consultant for law firms, financial institutions and various other organisations, including the EU, World Bank, research institutions and government agencies, on all continents.
Cash or cashless – A debate is under way within the European Union on whether to push for blanket cash transaction limitations. This is presented as a measure against the financing of terrorism, serious crime and tax evasion. However there is evidence that such limits may not be effective as crime-control measures. Cashpayment limitations (CPLs) are not a panacea that can address all these different types of crime. Experience from EU countries with CPLs in place shows higher levels of informal economic activity, corruption, tax evasion and terrorism risks than in those without them. There is also substantial evidence of very serious and organised non-cash crime. The risk is that determined offenders will shift to other methods and become more sophisticated, thus posing new problems for controllers. At the same time, CPSs are likely to have a number of adverse consequences for legitimate interests and human rights, especially for fragile communities and the elderly.
Hawala – Contrary to conventional wisdom, hawala and similar informal or traditional remittance channels primarily serving developing and cash societies could be a blessing in disguise. Although they entail risks and uncertainties, they also represent good business models, support economic development, assist communities in crisis and create useful opportunities that could be leveraged in parallel with the international community’s efforts to gradually build regulatory and governance capacity in developing and developed societies. In order to appreciate these features, we will take a closer look at hawala, its modus operandi and its multiple beneficiaries.
Greetje Bos is a public prosecutor based at the regional office of the Public Prosecution Service for the southern Netherlands. She specialises in local organised crime, outlaw motorcycle gangs, local gang criminality and financial crimes.
Hawala it is about moving money out of sight of the government. The reason for this could be distrust of the banking system, but the system is also a particular favourite of criminals. Originating on the Indian subcontinent, hawala was probably first brought to the Netherlands by immigrants as a means of remitting funds to relatives in their homeland. Over the years, however, it has become infected by criminals. They are turning increasingly to hawala “bankers”, possibly because checks on the financial system have tightened considerably and so forced them to search for alternative ways to move their money. The hawala system keeps the monetary obligations of the bankers involved more or less in equilibrium, in much the same ways as a money-transfer service like Western Union, but it only works if participants all over the world maintain their liquid assets at a certain level. To do this, couriers are regularly dispatched to transport vast amounts of cash between bankers or to and from clients – often quite literally in plastic shopping bags. These transfers are an essential part of hawala, but also its most vulnerable. They are when the police and prosecutors are most likely to try to intervene, since by seizing the cash they disrupt the whole system. In her conference talk, Greetje Bos examines the criminal world behind the hawala system and shares a number of case studies with the audience.
As a security consultant on the local public administrative approach to organised crime, Annemie de Boye deals with questions like how local authorities can play a leading role in preventing and combating criminal networks. Her interests also include the international exchange of expertise at the European level and cross-border cooperation involving the Netherlands.
The European Internal Security Fund (ISF) project CONFINE is a two-year collaboration between the Brabant-Zeeland Regional Crime Information and Expertise Centre (RIEC) in the Netherlands, the University of Leuven in Belgium and the Belgian cities of Antwerp and Genk, focusing on financial indicators of human trafficking. The handcarwash sector, with operators predominantly from an Indo-Pakistani background, is one very vulnerable to trafficking in human beings. First identified in the town of Genk, a network was discovered that – after two-anda- half years of investigation – appears to cover at least three Belgian provinces. At the centre of the web are one key person and his brother. They recruit labourers in a variety of vulnerable situations and exploit them by putting them to work at carwashes without proper contracts or payment. As controls by local government, police and inspection services are stepped up, the companies resort to a tactic of continuously changing their business structure and using various“legal” arrangements to create an impression of legitimate employment. For example, on paper labourers are called “manager”, “shareholder” or “associate”. When things get too “hot”, or when the business is threatened with closure by the authorities, bankruptcy is initiated for the isting company and a new one established at the same location by the same owners. The labourers are very often found to be living and sleeping at the carwashes.
Parallel Money Structures in the City panel discussion
Opening day 2 of Flying Money
Bill Browder is the founder and CEO of Hermitage Capital Management and Head of the Global Magnitsky Justice Campaign. He was the largest foreign investor in Russia until 2005, when he was denied entry to the country for exposing corruption in Russian state-owned companies.
In 2009 Browder’s Russian lawyer, Sergei Magnitsky, was killed in a Moscow prison after uncovering and exposing a US$230 million fraud committed by Russian government officials. Because of their impunity in Russia, Browder has spent the last eight years conducting a global campaign to impose visa bans and asset freezes on individual human rights abusers, including those who played a role in Magnitsky’s false arrest, torture and death. The USA was the first to impose these sanctions with the passage of the 2012 Magnitsky Act. A Global Magnitsky Act, which broadens the scope of the US Magnitsky Act to human rights abusers from all around the world, was passed at the end of 2016. Since then, other Magnitsky Acts have been adopted by several other countries, including Canada, UK, Estonia, Latvia, Lithuania and Gibraltar.
Session: Investigating illicit financial flows
Tom van Engers has worked at the Ministry of Finance since 1983, with a particular focus on innovation programs. He is also Professor of Legal Knowledge Management at the University of Amsterdam, Managing Director of the Leibniz Center for Law and Program Director of the Crime and Terrorism program at the Institute for Advanced Study.
Illicit activities usually result in illicit financial flows. Criminal organisations, often working in networks, and law enforcement agencies are involved in a game where hiding the intentions and unravelling financial flows require investments that are balanced with the potential profit and losses. In this contribution prof. Van Engers will sketch the agent-based approach that is core to the research on non-compliance at the Leibniz Center for Law. Looking both at the interests and abilities of individual agents and the dependencies on network partners and their interests and abilities will help law enforcement organizations to design better non-compliance defence mechanisms.
Rob Procter’s academic background is in Computer Science but his research has become increasingly interdisciplinary as his career has progressed. Social Informatics is the study of how cognitive, organisational and social factors shape processes of appropriation of ICTs. Current interests include methodologies and tools for big data analytics in the context of social and economic research. Procter has published over 260 peer-reviewed journal and conference papers. Andrew Elliott is working on detecting fraud in large transaction networks using novel network science methods. As a mathematician, he graduated from Imperial College London and went on to do a PhD at Oxford University. His PhD work involved network analysis and method development using ideas from mathematics, statistics, physics, and biology. Specifically looking at the properties of biologically motivated subnetworks sampled from a wider network with a focus on network null models and community detection methods.
Challenges for anomaly detection in financial transactions.
This talk will provide an overview of current methods for analysing big data for anomaly detection in financial transactions. It will then outline work in progress at the Turing Institute on anomaly detection in potentially time-dependent networks, using network comparison tools and spectral methods. These methods have applications in several domains including financial transaction networks and cyber security.
Rob van ‘t Oever leads the Intelligence Centre within the Security & Integrity Management department of ABN AMRO. He heads a team of approximately 45 security and compliance professionals with areas of responsibility including fraud and security incident response, law enforcement requests, and the bank’s whistleblowing process.
In future, financial crime is set to increase in volume and complexity. The number of cases is extremely large, the real estate market has become more international, there are new types of currency, and calls for greater transparency. Interests also vary: in the West, public opinion favours transparency, but is that also the case for China or Russia? How reliable is the public domain that is consulted for research? Damage to reputation is an important issue for a bank, but where does our responsibility end? Regulators make a wide variety of demands, but how effective are their wishes in relation to transaction monitoring? ABN AMRO believes that in the fight against fraud and corruption, cooperation is desirable among private partners, but is equally necessary with public partners. Information sharing can increase effectiveness. However, privacy considerations present a major dilemma. We regard trust as a keyword in collaboration, and common interests should be prioritised.
Jonathan Brown is a forensic accountant with 20 years’ experience of investigating fraud and financial crime, covering periods of boom and bust for the global economy. Based in London, he leads the forensic practice for Europe and Africa, comprising investigations, disputes and forensic technology.
He will discuss how investigations have changed during this period, how the world has moved from boxes of dusty paper records to the big data that surrounds us now, and the analytical tools and techniques that investigators have deployed to try to keep pace with fraudsters who often seem to be one step ahead. Jonathan will also discuss the role of the regulators in combatting fraud, corruption and financial crime, how they have adapted to the challenges they have faced since the global financial crisis in 2008, and any lessons this provides for the future. In a digital world where financial crime knows no borders, Jonathan will discuss how regulators across multiple jurisdictions can work together to share information and resources to maximum effect, and what role the private sector can play in this. In addressing these topics, he will consider the role of big data analytics, artificial intelligence, machine learning and crossborder regulatory cooperation.
Anita van Dis is the National Coordinating Public Prosecutor responsible for combating money laundering.
The fight against money laundering has been made a priority. The goals: protecting the integrity and stability of the international financial system and making it difficult for criminals to profit from their criminal activities. Criminals make large amounts of money from activities such as drug dealing, human trafficking, corruption and fraud. To benefit freely, they need to conceal the illicit origins of the money by investing it in real estate and companies. Money laundering is therefore a high risk for increased volatility of capital flows and a damping effect on legally sourced investments.
In 2009 Eric Smit founded the platform for investigative journalism Follow the Money with Arne van der Wal. In February 2018 he received the Journalist of the Year 2017 award with Kim van Keken. Smit holds a master’s degree in economics from Vrije Universiteit Amsterdam.
No country in the world plays a more important role in channelling funds to tax havens than the Netherlands. Twenty-three percent of the money flowing to sunny fiscal climes worldwide makes its way via the Low Countries. Amsterdam in particular, and its financial district, the Zuidas, plays a leading role. Not infrequently, the origins of this money are dubious to say the least. To prevent companies from only calling in on the Netherlands to evade tax, the Dutch Tax Service obliges them to meet ‘substance requirements’, some of which are of a physical nature. The result is that the artificial constructions in Amsterdam have a visible manifestation: offices belonging to the likes of corrupt Eastern European oligarchs, devoid of personnel, occupied by a minimum of one houseplant. On the form, substance and economic benefit of the Netherlands as a tax haven.
Investigating Illicit Financial Flows panel discussion
Session: Regulating urban finance
Gian Guido Nobili is currently Head of the Urban Security and Crime Prevention Department of the Emilia-Romagna Region (Italy). He oversees research programs, projects, and data systems concerning crime, victimisation, juvenile delinquency, organised crime, immigration, urban security and crime prevention.
Nothing is more intolerable for a Mafia member than to be deprived of his/her assets. The history of the Mafia teaches us that its members take into account the possibility of jail and detention for a certain number of years from the very outset of their criminal careers. Mafia bosses did not consider and did not even foresee that besides the loss of personal liberty, they would suffer the humiliation of being stripped of assets accumulated over their long criminal careers. In Secondigliano, a fair-trade clothing store formerly belonging to the Camorra, selling goods made in the city and regional penitentiaries will soon open. The shop has been assigned to a social cooperative for the project DiversaMente: vendiamo creatività!, selling artistic screenprinted products made by individuals with mental disabilities. The district of Monte Rosa in Scampia will see the launch of the NGO Papà separati for the project Ancora Genitori, a day-care, accompaniment, and support service for separated parents.
Giulia Baruzzo, as Senior official of humanitarian organisation and Coordinator of European desk for Libera, has worked on management of European projects such as Tackling Illegal Economy / EC Home Affairs.
Confiscated goods are a sign of a major shift for territories and communities: they become tools allowing us to enhance social development and implement social cohesion. In Italy, confiscated mafia assets can be socially reused by institutions and civil society (Law 109\1996), thanks also to the anti-mafia organisation Libera’s a network. In line with the Italian experience, the EU Directive 2014/42 has promoted the possibility to use confiscated criminal assets for social and public purposes also in other European countries. Developing common good practices centring on citizens needs and rights is fundamental to tackling the illegal economy.
Karin Wilschut has a background in the arts and cultural studies, a Bachelor in music from the ArtEZ Academy of the Arts, a Master in Cultural studies, Public administration and management from the University of Amsterdam.
Project 1012, a large-scale policy program to transform Amsterdam’s Red Light District and its immediate surroundings, will come to an end this year. The project applied an innovative approach that proved to be exemplary for so-called ‘area-specific integrated approaches’ in other districts of Amsterdam, and inspiring to other Dutch cities. A number of specific instruments that the City of Amsterdam used in Project 1012 are particularly relevant to the focus of this conference. They include the spatial distribution of certain sectors designated as being vulnerable to criminal influences, the implementation of the Integrity and Agreements Provision to prevent criminal involvement in contracts with local government, and the municipal regulation and acquisition of property in cooperation with housing corporations, based on the principle that bona fide property ownership is crucial to gaining control in a particular geographical location. The recent establishment of 1012inc, a public-private partnership, is another example of cooperative efforts to achieve a transparent investment climate in the city centre.
Jonas Hult is Chief Safety and Security Advisor at the city of Malmo. He has strategic responsibility for identifying, developing and implementing measures regarding safety, security and crisis management for the municipality of Malmö. This includes prevention of radicalisation and extremism, cooperation with police and civil society, close protection for politicians, coordination of governmental programs and crisis management and handling.
Stefanie Vermeul is a criminologist and has been working for the municipality of Rotterdam since 2014 as a policy officer for the Department of Public Safety. Here she has specialised in the administrative and integrated approach of organised and/ or subversive crime. Her expertise lies in tackling criminogenic industries such as money remittance offices, jewellers and rental agencies. Loes van der Wees works as a prosecutor at the National Program Rotterdam South (NPRZ), a joint, long-term collaboration between the Dutch national government, the city of Rotterdam, educational institutions, housing corporations, local business organisations, and local care providers. Together they work to improve the prospects of an area that is one of the most economically depressed and socially complex in the Netherlands.
Session: The Future of Financial Intelligence and Governance
Reinier Pollman is Program Manager of Innovation & Fintech at the markets and consumer protection regulator in the Netherlands (AFM). Within this role he is responsible for AFM’s InnovationHub to help companies overcome undue regulatory obstacles, and cooperation with the other regulators in the Netherlands. The other part of his role is to act on new emerging risks associated with the digitisation of services, artificial intelligence and crypto assets.
The AFM is the Dutch financial markets and conduct supervisor and our perspective on cryptos is how they affect the fairness and efficiency of capital markets. There are legitimate ideas about how financial markets could be improved by adapting blockchain technology, but what we currently see is an enormous speculative hype that offers an ideal breeding ground for fraud and market abuse. People use the story that many believe of the creation of new currencies in new blockchain ecosystems. This is for several reasons a development that should be stopped: investors will be disappointed and this could cannibalise regular capital markets that are based on mutual trust. Moreover, raising capital without acting in line with investors’ expectations comes close to fraud, which could impact general business integrity if it is not corrected by civil claims or criminal prosecution.
Hennie Verbeek-Kusters has been appointed Chair of the Egmont Group of Financial Intelligence Units for the period 2017-2019. Within the framework of the Egmont Group, she was Chair of the IT Working Group and of the Training and Technical Assistance Working Group. Since 2008, she has been Head of FIU-the Netherlands.
FIU-the Netherlands, like any financial intelligence unit in the world, is uniquely positioned between the public and the private sector. It receives unusual transaction reports from the regulated private sector, analyses them and then feeds the results of its analyses into the public sector in order to fight serious crimes, including terrorism, and support oversight. Important developments for FIU-the Netherlands are currently the exploration of public-private partnership, considering what can be revealed by using large data files in analyses, providing ideas and collaboration on new ways of tackling criminality and investigating ways in which financial intelligence can be generated with regard to cryptocurrency-related crimes.
John Christensen is a director of the Tax Justice Network, an expert-led network which heads global efforts to tackle tax havens and restrain tax competition and offshore secrecy. Trained both as a forensic auditor and economist, he has worked in many countries around the world, including a period of working in offshore financial services with Touche Ross & Co (now Deloitte).
The Dark Side of Cryptocurrencies – Are cryptocurrencies emerging as the sharpest tool in the money launderer’s toolbox? Since the mid-1990s, when the World Bank and others started to identify corrupt practices as a major impediment to economic and social development, concerns about cross-border flows of illicit finance have risen to the top of the policy agenda. In the past decade, faced with strong civil society pressure – backed by the evidence of the Panama Papers and Paradise Papers leaks – the G20 countries have brought forward important measures to improve transparency and strengthen cooperation between crime-fighting agencies and tax authorities. While nation states attempt to block flows of illicit finance and reassert a degree of sovereignty over their taxing rights, the rapid emergence of cryptocurrencies threatens to reverse the successes of the past decade. If the potential misuses of cryptocurrencies are left unaddressed, we will soon be back to square one.