Global action to combat the trade in endangered animals and
their body parts is mounting. Andrew Pimlott outlines what is being
done, with a focus on the measures being taken to prevent the
illicit proceeds of these crimes being laundered through the
financial system.
Visitors to London Zoo peering into the endangered Siamese
crocodile enclosure do not see a live animal swimming around, just
a handbag made from its skin. A notice explains that these reptiles
are found in rivers across Southeast Asia, but over the past 75
years more than 80% of them have disappeared, many hunted illegally
for commercial use.
The bag was seized by British border officials a few years ago
and has since been on display at the zoo to publicize the problem
of illegal wildlife trading. It only gained widespread publicity
this August when the story went viral on Twitter and spread to
mainstream media.
“In recent years the impact of illegal wildlife trade (IWT)
on species has reached unprecedented levels,” says the
zoo’s owner, the Zoological Society of London (ZSL). “This illicit trade is estimated to be worth up to $23 billion
a year and represents a threat to the very existence of some of our
best-loved species including rhinos, tigers, elephants, and
pangolins.”
The mass trafficking of animals is not only cruel and driving
some species to extinction but it also undermines the economies of
developing countries that rely on wildlife for tourism income. To
make matters worse, the money the criminals make from this trade is
then laundered through the international financial system and used
to fund other crimes and terrorism.
Action to stop the trade is being taken by wildlife
organizations like ZSL, national governments, international
organizations like the United Nations, law enforcement agencies,
and financial institutions. The latter plays a vital role in
disrupting the financial flows of this business through strict
anti-money laundering (AML) procedures.
South African Banks Take The Initiative
Investec, the Anglo-South African international banking and
wealth management group, is a good example. It works closely with
the South African Anti-Money Laundering Integrated Task Force
(SAMLIT), part of the government’s Financial Intelligence
Center. In 2020, SAMLIT established an expert working group (EWG)
on the IWT, with Investec as a member, along with other financial
institutions such as Absa, Capitec Bank, Citi South Africa,
Nedbank, and Standard Bank.
The EWG’s November 2021 report, Financial flows associated with illegal
wildlife trade in South Africa, said that until recently
there had only been “limited attention given to investigating
and understanding” these flows”. The situation has now
changed, with the EWG increasing knowledge among financial
institutions, financial regulators, and law enforcement authorities
about these flows and helping them to disrupt them. The report shed
light on the use of informal payment schemes, cash, and front
companies to launder funds and avoid detection, and how transaction
monitoring and analysis can be used by banks and the authorities to
improve detection rates.
In March this year, SAMLIT revealed that its
public-private partnership had resulted in 12 arrests and the
seizure of 78 rhino horns, ivory, and other wildlife products. Gerald Byleveld, Investec’s Head of
Financial Crimes Compliance, and head of SAMLIT’s EWG said “it takes a network to catch a network, and we have learned
that by joining forces and communicating through legal frameworks,
we can be much more effective than by operating in silos”.
Global Coordination on Money Laundering
International government organizations are taking action too,
such as the Financial Action Task Force (FATF), the Paris-based
inter-governmental body which coordinates global measures to combat
money laundering and terrorist financing. In 2020 it published
Money laundering and the illegal wildlife trade, a guide
to countries on what measures they can take to combat the
problem.
It urged governments “to identify and assess their money
laundering risks relating to the illegal wildlife trade” and
to “ensure that national laws and powers for law enforcement
allow authorities to go after the finances of wildlife traffickers,
and to pursue financial investigations”. It added that the
private sector had a role to play too, and listed “good
practices and risk indicators” for banks and others to adopt
in identifying financial activity linked to this trade. FATF
followed up with a similar but wider-ranging report in 2021, Money laundering from environmental
crime.
Wildlife organizations leading the fight against IWT are acutely
aware of the need to enlist the support of the financial sector.
One of these is United for Wildlife (UfW), founded by Prince
William and the Royal Foundation in 2014 and still spearheaded by
him as the new Prince of Wales. It aims to make it impossible for
traffickers to transport, finance, or profit from illegal wildlife
products by working with governments, the transport and finance
sectors, law enforcement, and other organizations.
The bank-led Financial Taskforce within UfW aims to stop
wildlife traders from using the global banking system to transfer
and launder their income. Its 38 signatories include banks like
Standard Chartered, Credit Suisse, HSBC, ANZ, Commercial Bank of
Africa, and Citigroup. It also includes technical experts such as
TRAFFIC – the Cambridge-based organization tackling illegal
trading in wildlife – and the UN Office on Drugs and
Crime.
Vice-Chair of the Taskforce is David Fein, General Counsel of
Standard Chartered, one of the UK’s biggest banks. “The
illegal wildlife trade is a serious organized crime, carried out by
ruthless cross-border criminal networks,” Mr. Fein told delegates at a conference organized
by UfW and the British High Commission in Botswana earlier this
year. “By convening and working collaboratively with the
transport and finance sectors, building key partnerships with NGOs,
and sharing information and best practices across the sectors, we
will disrupt this criminal network.”
The Southern African chapter of UfW was involved
with SAMLIT’s role in the successful arrests and rhino horn
seizures mentioned earlier which, said Mr. Fein, set “a
brilliant example for other countries and regions of how
collaboration, focus, and commitment can make a positive difference
for our communities and our planet”.
The Importance of Training
TRAFFIC, as well as being a member of the Financial Taskforce,
helped the Miami-based Association of Certified Anti-Money
Laundering Specialists (ACAMS) launch in July 2022 a Chinese language version of ACAMS’ “Ending illegal wildlife trade” certificate.
Individuals taking the course are trained “to identify,
report, mitigate and remedy the risks associated with each stage of
the illegal wildlife supply chain”.
The original certificate was developed and launched in 2020 by
ACAMS and the Washington DC-based World Wildlife Fund (WWF), with
the support of UfW. ACAMS CEO Scott Liles said he was “proud
that our continued partnership with WWF and now TRAFFIC” has
enabled it to offer a Chinese version of its certificate and to
expand its scope with new content – case studies highlighting
recent ivory, timber, and wildlife-trafficking investigations in
Thailand, Tanzania, and China.
The Bigger Picture
Although it is important to disrupt the financial flows
associated with the illegal wildlife trade, the ultimate objective
is to stop the physical flow of live animals and their
body parts. For example, the British government’s Department
for Environment, Food and Rural Affairs (Defra) in July awarded a further £7m to the Illegal
Wildlife Trade Challenge Fund. Funded by taxpayers but run by
engineering consultancy NIRAS-LTS, the fund supports projects
around the world tackling this illicit trade. To date, the fund has
supported 136 projects in more than 60 countries to the value of
£43m.
At the Inter-governmental level, the United Nations Environment
Programme (UNEP) has launched multiple initiatives, one of the most
recent being this April when it joined forces with WWF-India and India’s Wildlife Crime Control
Bureau to combat wild animal trafficking at the country’s
airports. The UN Office on Drugs and Crime’s (UNODC’s)
World wildlife crime report
2020 received wide publicity when it emphasized the threat the
activity “poses to nature and the biodiversity of the
planet”.
Wildlife trade is regulated through the 1975 Convention on
International Trade in Endangered Species of Wild Fauna and Flora
(CITES) to which 184 countries are signatories. The CITES
secretariat, which works closely with the United Nations, organizes
World Wildlife Day. CITES Secretary-General Ivonne Higuero said at
this year’s event that international regimes and national
government-led policies are critical for protecting wildlife, but
some of the most important work “is done by local people and
[local] organizations”.
At CITES’ 19th World Wildlife Conference
in Panama this November, 4,000 delegates will be asked to consider
stricter trade regulations for nearly 600 species of animals and
plants believed to be under increased threat of extinction from
international trade.
I have already mentioned TRAFFIC’s role in making it harder
for traders to launder their ill-gotten money but has a much
broader remit to do anything it can to stop trafficking. For example, it has set up four regional Trade in
Wildlife Information eXchanges (TWIXs), such as EU-TWIX and
Africa-TWIX. These online tools facilitate cooperation between law
enforcement agencies across Europe and Africa, such as Interpol
(International Criminal Police Organization) and Europol, to help
them catch and prosecute traders. Interpol’s successful operation this year
– codenamed Golden Strike – to arrest wildlife
traffickers and seize ivory and other animal parts across Africa
and Asia relied heavily on intelligence sharing between 23
countries.
As with any type of crime, it will be impossible to eliminate
entirely the illegal wildlife trade. But with financial
institutions, consulting firms, governments, and wildlife charities
working together they will surely succeed in reducing the scale of
the problem.
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Source: mondaq.com
