Corruption and Illicit Trade

One of the key underlying conditions that makes countries more vulnerable to illicit trade is corruption, which erodes controls designed to prohibit illegal goods to move across borders, undermines law enforcement operations to detect or interrupt illicit trade, and contributes to impunity of illicit traders. 

A new report from the Transnational Alliance to Combat Illicit Trade (TRACIT) - Money Talks: The Crooked Connection Between Corruption and Illicit Trade - finds that corruption is affecting illicit trade worldwide. There is not a single sector of illicit trade that is not tainted by corruption, including agrifoods, alcohol, IUU fishing, forced labor, timber, or wildlife, pharmaceuticals, pesticides, precious metals, gemstones, tobacco products, petroleum, or counterfeiting. 

Examples of when corruption is encountered during illicit trading include when:

• Border agents and customs officials facilitate the movement of illicit goods.
• Law enforcement officials fail to report or investigate illegal operations, prevent arrests or release suspects.
• Government officials facilitate the fraudulent issuance of permits and licenses, allow quotas to be exceeded or interfere with regulatory inspections.
• Officials involved in the criminal justice process help evidence disappear during prosecutions, delay or drop prosecutions, or to return no convictions in the cases of those who are brought to trial.
• Furthermore, there is a robust correlation between corruption (as measured by Transparency International’s CPI) and illicit trade (as measured by the EIU’s Global Illicit Trade Environment Index).

The report finds that any successful steps to mitigate illicit trade will necessarily require strong and targeted measures to mitigate corruption and prevent corrupt actors from compromising the integrity of the global supply chain.

Based on the findings of the report, TRACIT has formulated a set of policy recommendations aimed at facilitating an effective response to corruption in the context of illicit trade. These recommendations provide a “checklist” of fundamental measures that governments are encouraged to implement to improve their ability to defend against the wider societal harms of illicit trade, with a particular emphasis on addressing the enabling role of corruption in perpetuating illicit supply chains.

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Launch event | Money Talks: The Crooked Connection Between Corruption and Illicit Trade

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The report "Money Talks: The Crooked Connection Between Corruption and Illicit Trade" was launched at virtual panel discussion on 22 February 2024. 
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KEYNOTE ADDRESSES

• Dr. ​Daniel Eriksson, CEO, Transparency International

MODERATOR

•  Jeffrey P. Hardy, Director-General, TRACIT

PANELISTS

• Dr. Marion Jansen, Director of the Trade and Agriculture Directorate, OECD
• Dr. Tasha Hippolyte, Deputy Assistant Secretary for Trade Policy, US Department of Homeland Security
• ​Andrea Hampton, Integrity Lead & A-CIP Programme Manager, Capacity Building Directorate, WCO
• Darya Galperina, International Public Affairs Director, Pernod Ricard

Dr. Ulrika Bonnier, TRACIT Director of Programs and principal author of the report, presented the key findings.  
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​The webinar addressed the interrelationship between illicit trade and corruption and explored solutions available to prioritize and intensify an anti-illicit trade agenda at the national level.

Video Summary of Panel Discussion

Full Video Recording of Panel Discussion

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Quote cards

MEDIA CENTER

TRACIT media materials

• TRACIT Media Release​

Download full report

download executive summary