Evidence of illicit financial flows from developing countries placed in Germany

Query

Do enough publicly available sources exist that suggest Germany is an important financial centre for corrupt elites from the developing world?

Purpose

To inform work for German authorities on Illicit Financial
Flows.

Content

1. Introduction
2. Evidence of illicit flows from developing countries placed in Germany
3. References

Summary

Public assets illegally obtained from developing countries are often hidden in banks located in the financial centres of developed countries. Global Financial Integrity estimates losses in developing countries between USD 723 billion and USD 844 billion per year in 2009. As a key financial centre in the world, it is likely that Germany provides a stable investment environment for corrupt elites from developing countries who are intent on layering and integrating criminal proceeds. However, due to the illicit and secret nature of such transactions, it is difficult to get a precise figure, and there is very limited publicly available evidence on the role Germany plays in the process.

However, a few reports have recently uncovered suspicious transactions between German Banks and allegedly corrupt elites from Turkmenistan and Libya. Other studies have highlighted the lack of transparency of the German financial system which could leave room for the placement of ill-gotten wealth in the country.

There is limited evidence that Germany is an important financial centre for corrupt elites from the developing world. However, Germany still does not do enough to preventing illicit financial flows originating from tax evasion, corruption, and other criminal activities to enter the country.

Authors

Maira Martini, Transparency International, [email protected]

Reviewers

Marie Chêne, Transparency International, [email protected] Robin Hodess, Ph.D, Transparency International, [email protected]

Date

23/05/2012

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