Supply chain

Home > Supply Chain Vulnerabilities to Illicit Trade

Supply Chain Vulnerabilities

Illicit actors exploit the way modern supply chains operate. As goods pass through multiple intermediaries, countries, and transport modes, oversight weakens and responsibility fragments. Traffickers exploit these gaps to divert goods, obscure their origins, and move illicit products alongside legitimate trade.

TRACIT's research shows that traffickers focus on supply-chain segments where governance and enforcement are weakest. TRACIT identified online platforms, free trade zones, and postal and express delivery systems as hotspots, where controls are lighter, volumes are high, and accountability is diffuse. These vulnerabilities now sit at the core of how illicit trade scales across sectors and borders.

Focus vulnerabilities

E-commerce

E-commerce has become a major gateway for illicit trade. Traffickers exploit weak platform controls, limited seller verification, and inconsistent enforcement to sell goods that would be prohibited in regulated offline markets. This combination of scale, speed, and jurisdictional fragmentation makes e-commerce a key vulnerability in global supply chains.

Explore TRACIT's work on e-commerce here.

Free trade zones

Free trade zones offer economic incentives for legitimate trade but also open structural gaps that illicit actors exploit. Special zones within national territories often operate under relaxed customs and regulatory requirements, which traffickers exploit to store, relabel, repack, and transship illicit goods without effective oversight.

Explore TRACIT's work related to Free Trade Zones here.

Postal systems

Postal systems and express couriers have become a preferred channel for illicit trade. High parcel volumes, fast delivery times, and limited inspection capacity make small consignments difficult to screen effectively. Traffickers exploit these conditions by shipping illicit goods in low-value, low-risk parcels that evade detection while allowing large quantities to reach consumers directly.

Explore TRACIT's work related to postal systems here.

Supply chain-related news

The EU Council introduces a €3 customs duty on small e-commerce parcels, addressing unfair competition, consumer safety risks, fraud, and environmental concerns linked to duty-free imports in the EU.

Featured publication

The landscape of lawlessness online (coming soon)

The report documents the breadth of illicit trade occurring on online platforms and examines the structural weaknesses that allow such activities to persist.

Exposing supply chain vulnerabilities to illicit trade

TRACIT's foundational report examines regional systemic weaknesses in complex supply chains that traffickers exploit to trade in illicit goods.

Illicit trade in free trade zones – focus on Central and South America

The report shows that FTZs in Central and South America are misused to facilitate illicit trade and identifies major vulnerabilities.