In Europe, Crime (probably) Still Pays

Copyright Mark Anderson

A recent Europol survey on criminal asset recovery has attempted to assess the extent to which EU forfeiture efforts achieve their target of denying criminals the benefits of the proceeds of crime. Sadly, the conclusion is that the gap between the estimated amount of laundered funds and what is seized/forfeited is quite large.

The estimate is that about 0.9% of Europe’s GDP is comprised of illicit markets (roughly €110 billion). Of this €110 billion, the estimate for the amounts seized or frozen (i.e. temporarily held pending the conclusion of investigations or proceedins) is around 2.2%. The amount ultimately confiscated or forfeited is around 1.1%.

As the author of the report puts it:-

The fact that so few seized assets are ultimately confiscated may be due to a loss in the value of assets
during proceedings that often take too long, or due to difficulties in proving the illicit origin of assets and ensuring the final confiscation of the assets. Overall, these figures show that there is a need to improve the collection of information across EU Member States to identify and understand the main trends and patterns.

Some weaknesses highlighted in the European asset recovery system include lack of a centralised registry of seized/confiscated assets in many countries. Furthermore, the fact that different bodies are involved at different stages of asset recovery makes for difficulties in obtaining complete data on domestic effectiveness. This means that assessing continent-wide  trends and patterns is difficult. This is illustrated by the fact that much of the data in the report is based on estimates.

But the report also points to the fact that EU states are currently aligning their asset recovery processes to EU standards and that seizures/confiscation are increasing as positive developments.

The recommendation is for better data collection (including having an asset registry and digitalising seizure and confiscation orders), harmonisation of statistics across the EU and enhancement of investigatory and asset recovery procedures (including investing more in training and strengthening financial investigations).