Caspian Report - Issue 06 - Winter 2014

Kremlin Palace,
Russia.
year. GFI’s report “Illicit Financial
Flows from Developing Countries:
2002-2011” has been recently published.
According to the report, illicit
cash flow from developing countries
between 2002 and 2011 was $5.9
trillion. In 2011 a total of $946.7 billion
was exported to other countries/
places illegally from source countries
and never came back. As stated,
the amount of illicit financial flows
in China between 2002 and 2011 is
$1.08 trillion, which is the highest
among others. The second highest
ACCORDING TO THE JANUARY-SEPTEMBER 2013 DATA
PUBLISHED BY RUSSIAN CENTRAL BANK, THE AMOUNT
OF “LEGAL” MONEY TRANSFER FROM RUSSIA TO CIS
COUNTRIES IS $15 BILLION.
amount is $881 billion in Russia. As
indicated in the report, already high
illegal dollar flow from Russia increased
incrementally from 2002 to
2011.
Russia needs to take measures
against illicit financial flows. Head of
State V. Putin signed the law for preventing
illicit financial flows in July
2013. The aim of this law is to prevent
financing of international terror with
unrecorded money and also prevent
money laundering. At this point, we
need to mention about illicit money.
Illicit money is defined as all kinds
of economic interests, assets and
revenues obtained with criminal
activities. Money laundering can be
described as concealing the source of
illicit income and make it look like it
is obtained from a legal source. Illicit
money is strictly monitored at the
national and international level as it
is the source of threats such as terror,
international organized crimes, drug
trafficking, corruption, etc. Financial
Action Task Force (FATF) should be
discussed at this point. FATF was established
with the aim of preventing
money laundering in 1989 under the
leadership of G-7 states. Today, FATF
has 36 members in total; 34 states
and 2 organizations. Russia became
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CASPIAN REPORT, WINTER 2014