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G7 Leaders Reaffirm Commitment to Tackling Illicit Financial Flows, Promoting Sustainable Development

GFI Urges G7 Leaders to Push for an Illicit Financial Flows Goal in the Post-2015 Sustainable Development Agenda

GFI Calls for Implementation Assessments on Beneficial Ownership Commitment to Be Published by End of 2014

WASHINGTON, DC – G7 leaders meeting in Brussels reiterated their commitment to curtailing illicit financial flows stemming from crime, corruption, and tax evasion in a communiqué released today, as Global Financial Integrity (GFI) called on world leaders to push for an explicit illicit financial flows commitment in the post-2015 Sustainable Development Goals (SDGs).

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Financial Transparency: Moving Towards Systemic Solutions

Contributing to a Safer and More Secure World Demands That Financial Intelligence Units Work to Change the System from Within

GFI President Raymond Baker delivered the keynote address before the 22nd Plenary of the Egmont Group of Financial Intelligence Units in Lima, Peru.

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New York Regulator on BNP Paribas: Someone Needs to Get Fired

Reuters has the story. Settlement negotiations are under way between New York and Federal law enforcement and BNP Paribas, to resolve allegations into whether or not the bank evaded U.S. sanctions. Reports have been circulating for a few days now that BNP Paribas could see financial penalties of up to $10 billion and may plead guilty to violating U.S. law.

Benjamin Lawsky, the Superintendent of Financial Services for New York State, is negotiating on behalf of New York. Previous money laundering settlements have resulted in much more modest fines, and little change at the senior level of of the bank’s management. Regulators may have expected banks to choose to fire senior management on their own following billion-dollar settlements in previous cases, but that did not materialize. This time, Lawsky does not want to leave it to chance:

“The details of settlement talks show how regulators are now demanding that bank employees be held personally accountable for their activities.

Lawsky, a former federal prosecutor who has extracted large penalties from other banks such as Standard Chartered Plc and Credit Suisse Group AG, has said he is making personal accountability a focus in his probes.

“If a bank commits a criminal act or if a bank commits serious regulatory violations, someone within that bank did it. The corporation is an inanimate thing,” Lawsky said last month.”

We’ll be monitoring this situation, but here’s a thought: will this rationale be extended to criminal prosecutions? Will Lawsky stop at requiring banks to fire individuals who committed crimes, or will they actually be prosecuted?

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GFI Engages, First and Second Quarter 2014

A Quarterly Newsletter on the Work of Global Financial Integrity from January through May 2014

Global Financial Integrity is pleased to present GFI Engages, a quarterly newsletter created to highlight events at GFI and in the world of illicit financial flows. We look forward to keeping you updated on our research, advocacy, high level engagement, and media presence.

This year has been busy so far, with GFI staff traveling to six continents within the first three months alone. The following items represent just a fraction of what GFI has been up to, so make sure to check our new website for frequent updates.

Measurable Change in India

In late April, the Indian Directorate of Revenue Intelligence released a summary of its first two years of increased law enforcement activity targeted at cases of commercial fraud, including illicit financial flows through trade misinvoicing. Their early results have been remarkable: between March 2012 and March 2014, they detected $1.3 billion worth of commercial fraud, and collected $396 million in new revenue.

India is just beginning its effort to crack down on trade-related illicit financial flows, and should serve as an example of the potential that curtailing trade misinvoicing has for development. India began working in earnest to reduce illicit financial flows after a report by Global Financial Integrity showed the economy had lost $462 billion since 1948 due to illicit outflows. Following years of intense political debate and public outcry, the Indian Ministry of Finance declared trade misinvoicing its ‘top priority’ and began working with GFI and others to address it.

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GFI Applauds Historic OECD Announcement on Global Transparency of Financial Information

New Standard Ensures All Nations Can Potentially Benefit from Robust, Automatic Exchange of Financial Information

G20 Finance Ministers to Review Document for Approval Next Week Ahead of Australian G20 Summit in the Fall

Research and Advocacy Organization Expects New Transparency Regime to Be ‘Game-Changing’ Deterrent to Cross-Border Tax Evasion, Money Laundering

WASHINGTON, DC – Global Financial Integrity (GFI) applauded the Organization for Economic Cooperation and Development (OECD) today following its historic release of a new model multilateral agreement that countries will use to tackle tax evasion, money laundering, and other financial crime. GFI, a research and advocacy organization based in Washington, DC, touted this as a major victory and welcome culmination of one front in the long battle for cross-border financial transparency.

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U.S. Must Do More to Tackle Phantom Firms on International Anti-Corruption Day

Monday was International Anti-Corruption Day, an occasion for those who work to fight bribery, money laundering, and illicit capital flight to reflect on the past year and set goals for the next. We have many reasons to celebrate 2013, but also plenty of work still to do in 2014. At Global Financial Integrity, our research shows that nearly $1 trillion leaves developing countries each year (many times the amount such countries receive in official development assistance) through illicit financial outflows, a devastating loss of capital facilitated by a shadow financial system more than happy to accommodate corrupt assets. Gains in tax information exchange and other areas this year will surely help curtail some of this moving forward, but there are many more policy changes needed before this economic scourge can be effectively addressed.

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On International Anti-Corruption Day, GFI Reviews Major Developments from 2013

WASHINGTON, DC – As the world commemorates International Anti-Corruption Day on Monday, December 9, 2013, Global Financial Integrity (GFI)—a Washington-based, non-profit research and advocacy organization—reviewed many of the most notable achievements, developments, and shortcomings in fighting corruption and illicit financial flows for 2013.

“2013 has proven to be a landmark year in terms of policy advancements to curtail corruption and illicit financial flows,” said GFI President Raymond Baker, a longtime authority on financial crime. “Years of hard work by policymakers, researchers, and advocates culminated in real, on-the-ground policy achievements that will directly impact the amount of money leaving developing countries. We saw a few setbacks, but overall the year was very encouraging.”

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Raymond Baker at the “Human Rights and Economic Justice: Essential Elements of the Post-MDG Agenda” Conference

GFI President Raymond Baker delivers remarks at the “Human Rights and Economic Justice: Essential Elements of the Post-MDG Agenda” conference at Yale University on October 18, 2013.  Mr. Baker’s remarks provide an overview of the issue of illicit financial flows, and he explains how it plays into the Post-2015 Development Agenda.

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