Europol: Financial Crime Makes “Billions” and Impacts “Millions”

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A perfect storm of digitalization, geopolitical tension and organized crime is helping to drive financial and economic crime to new heights, a Europol report has warned.

The policing alliance’s first ever European Financial and Economic Crime Threat Assessment was compiled from “operational insights and strategic intelligence” contributed by member states and Europol partners.

It described a criminal economy worth billions of euros and which impacts millions each year.

Technology plays a key role as an enabler of such crime, including encrypted messaging apps, dark web marketplaces, cryptocurrency, cybercrime-as-a-service models, ChatGPT for phishing and deepfakes, it explained.

Legitimate fintech innovations like virtual IBANs, which help to mask suspicious transactions, and buy-now-pay-later (BNPL) financing, which is prone to account hijacking, can also hand an advantage to criminal community, the report claimed.

Read more on financial crime: UK Regulator Issues Record Fines as Financial Crime Surges

Europol also blamed money laundering and corruption as a critical engine of financial and economic crime, citing previous figures that nearly 70% of criminal networks operating in the EU make use of one form of money laundering or the other to fund activities and conceal assets.

Geopolitical developments have also played their part, specifically Russia’s invasion of Ukraine, which helped to drive a cost-of-living crisis that has exposed more vulnerable members of society to exploitation.

“Financial crimes, and in particular money laundering, undermine our society not only by infiltrating the legal economy, but also by fostering the growth of a parallel underground society made of individuals who increasingly rely on organised crime for their economic sustenance and livelihood,” the report argued.

“Vulnerable demographics, and especially vulnerable youngsters who are lacking trust in societal institutions and confidence in the rule of law, are the perfect target pool for such parallel underground society.”

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