Purpose The development of the Nigerian industrial sector is critical for the achievement of sustainable development. However, the gowing volume of trade misinvoicing, among other illicit financial flows, greatly undermines the limited available domestic resources needed to power industrial development. The Nigerian government has made concerted efforts toward industrialization, but the efforts seem futile. Thus, this study investigates whether trade misinvoicing is one of the factors fostering or dampening industrial development in Nigeria. Design/methodology/approach Annual time-series data covering the period between 1986 and 2018 were sourced, and the dynamic ordinary least squares (DOLS) estimation technique was used to analyse the data. Findings The results reveal that trade misinvoicing has a catastrophic effect on industrial development, as it has largely impeded industrial progress in Nigeria. This adverse effect not only restrains the contribution of the industrial sector to aggregate output but also limits the sector's capacity to absorb the teeming Nigerian labour force. Practical implications The practical implication of these findings is that the Nigerian government and policymakers need to design and implement sound strategies and policies to tackle trade misinvoicing, improve regulatory quality and bolster industrial development. Originality/value The research is the first to empirically examine the effect of trade misinvoicing on industrial development in Nigeria.

Purpose This study aims to investigate the impact of environmental, social and governance (ESG) disclosures, financial reporting quality (FRQ) and illicit financial flows (IFFs) on investment efficiency (INVEFF) in the Gulf Cooperation Council (GCC) region and examine the moderating role of financial constraints in these relationships, focusing on non-financial firms. Design/methodology/approach Fixed-effect panel regression models are applied to examine the impact of ESG disclosures, FRQ and IFF along with the moderating role of financial constraints using data from 62 non-financial firms for the period 2015 to 2022, encompassing both pre- and post-COVID-19 periods to examine the pandemic effects. Findings The empirical results reveal a consistently positive relationship between FRQ and INVEFF, whereas IFFs exhibit a significant negative impact. ESG disclosures show a mixed effect, with potential inefficiencies arising when financial constraints limit firms' strategic flexibility. Furthermore, financial constraints appear to aggravate the negative consequences of IFFs and weak financial reporting. Limited regulatory enforcement around ESG disclosures also diminishes their signaling strength, particularly in capital-constrained environments. Practical implications The findings propose that INVEFF can be enhanced by improving financial reporting transparency and curbing IFFs. Simultaneously, policymakers are encouraged not only to standardize ESG frameworks but also to support financially constrained firms in aligning with sustainability goals. Originality/value This study offers empirical evidence from an underexplored emerging market, GCC, while filling a research gap by examining how financial constraints moderate the impact of ESG, FRQ and IFFs on INVEFF. It further highlights how ESG disclosures in a voluntary environment may serve as a governance tool, especially during periods of economic disruption.

Money Laundering has emerged as one of the most significant threats to the integrity of financial and legal systems worldwide. In Nigeria, legal practitioners occupy a unique position as both facilitators of legitimate transactions and potential enablers of illicit financial flows. This paper aims to critically examine the role of legal practitioners in money laundering within Nigerian legal practice, with particular focus on the Rules of Professional Conduct 2023. The objective of the paper is to assess the duties imposes on lawyers in preventing money laundering, evaluate adequacy of existing regulatory and professional frameworks and propose measures for strengthening compliance. Methodologically, this paper adopts a doctrinal approach, relying on both primary and secondary sources (statutory provisions, case law, scholarly writings and comparative analysis of regulatory frameworks in the United Kingdom, South Africa and Canada. The Major findings reveal that while Nigeria has enacted robust anti-money laundering laws, challenges persist including weak enforcement, lack of clarity on the limits of professional privilege and insufficient awareness among practitioners. Thus, the paper recommends clearer professional guidelines, enhanced disciplinary measures by the Nigerian Bar Association, mandatory compliance structures in law firms and adoption of international best practice to ensure that the legal profession upholds its ethical responsibility in combating money laundering.

This paper argues for a permanent and auditable Enemy Criminal Law framework to confront criminal factions that deny the rule of law and exert territorial and prison governance in Brazil. Grounded in Jakobs’ theory, it distinguishes citizen criminal law from the treatment of the enemy as a collective actor threatening the legal order, emphasizing prevention and the neutralization of capacities (command, communication, finance, logistics). Brazil’s reality reveals prisons that often produce, rather than neutralize, criminal power; that “low-cost obedience” signals strong factional governance; and that episodic operations do not dismantle structures. Drawing on El Salvador’s experience, the paper outlines the swift encirclement of leaders, an effective break of prison-based command, and dense institutional state presence in affected areas. It explores constitutional accommodation and, alternatively, the need for constitutional reform. Success is measured by sustained loss of factional governance, blockage of new illicit financial flows, and restoration of state jurisdiction—rather than raw enforcement volume.

Crucial financial topics have been debated during the latest International Conference on Financing for Development. After taking stock of different stakeholders’ input, their contributions within the tax field are systematized, and the outcome document is critically assessed. The renewed framework for Domestic Resource Mobilization (DRM) comprises stronger tax policies and administrations, tax reforms based on smart use of context-specific data, and the improvement of specific categories of taxes. It addresses progressivity, solidarity and international tax cooperation, taking into consideration human rights. African countries have relied on their own efforts to strengthen DRM capacity but call for support in the fight against illicit financial flows. They are simultaneously working collectively to shape the UN Framework Convention on International Tax Cooperation and its protocols. In any reconfiguration of the domestic or international financial architecture, the oversight by audit institutions should be reinforced. Despite wishes to quickly put into practice several commitments with The Sevilla Platform for Action, the Compromiso de Sevilla may fall short regarding taxation.

Assessing country risk in Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) is increasingly significant in global financial integration, digitalisation, and persistent illicit financial flows. Despite international standards, the unobservable nature of laundering makes risk measurement highly dependent on proxies and methodological choices, creating both conceptual and practical challenges. This research aims to conduct a comparative analysis of AML/CFT country risk assessment methodologies, integrating policy frameworks with econometric and probabilistic models. The study employs a comparative analytical framework, synthesising official assessments (FATF mutual evaluation reports, NRAs, and IMF/World Bank tools), quantitative indexes (e.g., Basel AML Index), econometric approaches (Walker-Unger gravity model, Ferwerda’s black box, Schneider-Windisch MIMIC), qualitative frameworks, and emerging Bayesian/probabilistic methods. The findings indicate that no single methodology provides a definitive measure of country risk. Policy-driven tools ensure global legitimacy and comparability but are static, resource-intensive, and sometimes politicised. Composite indices and proprietary models offer usability and accessibility but often lack methodological transparency and risk oversimplification. Academic econometric approaches generate quantitative estimates and enhance analytical depth, though they remain sensitive to assumptions and limited in operational application. Probabilistic and Bayesian methods represent a promising frontier, explicitly incorporating uncertainty and diverse data sources, but their complexity and reliance on subjective priors constrain widespread adoption.

This study examines the legal foundation of the Financial Services Authority (OJK) in preventing money laundering (TPPU) within Indonesia’s financial system through a normative juridical approach. The OJK, as an independent supervisory institution, derives its authority from statutory regulations that establish its responsibility to regulate, supervise, and enforce compliance in financial services. This authority plays a central role in preventing illicit financial flows, safeguarding market integrity, and strengthening national economic stability. The research highlights that OJK’s preventive mandate is not only rooted in domestic legal instruments but also harmonized with international standards and responsive interpretations of Islamic legal principles, thereby ensuring legitimacy, accountability, and public trust. Furthermore, the study underscores the importance of OJK’s coordination with other law enforcement agencies such as the Corruption Eradication Commission (KPK) and the Public Prosecutor’s Office, creating an integrated legal framework against financial crimes. In conclusion, OJK’s legal authority represents a pivotal mechanism for enhancing financial transparency, closing systemic loopholes, and combating corruption-related practices that threaten economic justice. The findings affirm that the strengthening of OJK’s role is essential in adapting to the evolving sophistication of financial crimes and in promoting sustainable, just, and accountable governance.

Purpose This study aims to conduct a systematic literature review on illicit financial flows (IFFs), with a focus on uncovering the institutional and behavioral factors that shape such flows at global, national and corporate levels. Design/methodology/approach Following the PRISMA protocol, 25 highly cited peer-reviewed articles (2005–2023) were retrieved from Scopus. Manual thematic coding and deductive synthesis were applied to categorize evidence related to enforcement failures, regulatory arbitrage, institutional loopholes and the dual role of technology. A new conceptual framework links IFF dynamics to governance and cross-border accountability. Findings Four key themes emerged: definitional ambiguities and inconsistent metrics, regulatory arbitrage through trade misinvoicing and capital shifting, opaque intermediaries and shell structures and digital enablement via fintech and unregulated platforms. These patterns reflect a broader enforcement–enablement dynamic, with limited institutional perspectives and weak cross-jurisdictional regulatory coordination. Research limitations/implications This review is limited to English-language journal publications indexed in Scopus, potentially omitting gray literature and policy-based regional insights, particularly from low-income jurisdictions. Originality/value This study offers a theory-informed synthesis of IFFs by reframing them as outcomes of systemic governance failures rather than isolated financial crimes. It integrates governance, compliance and deterrence perspectives into the enforcement–enablement framework and aligns findings with Sustainable Development Goals 16.4 and 17.

ABSTRACT: Illicit financial flows (IFFs) are a major drain on Africa's economic potential, with losses hitting around $88.6 billion each year. These unrecorded and illegal capital outflows seriously undermine public sector investments, especially in healthcare. Recent evidence suggests that IFFs might also be a roadblock for immunization programs, like polio vaccination, in Sub-Saharan Africa. This study uses a longitudinal panel dataset that includes 200 observations from 10 Sub-Saharan African countries spanning from 2000 to 2020. By applying a Fixed Effects Regression model, the research delves into the causal link between polio vaccination coverage and IFFs. The dataset's stationarity was confirmed through the Levin-Lin-Chu (LLC) unit root test and the Augmented Dickey-Fuller (ADF) test for added reliability. Key independent variables in the study include polio vaccination coverage, government health expenditure, the percentage of the urban population, and physician density. The model selection was informed by the Hausman specification test, which preferred Fixed Effects over Random Effects, ensuring the estimators accurately captured country-level differences. The regression analysis shows that a 1% rise in polio vaccination coverage is linked to an estimated $8.55 million drop in IFFs. Although this relationship isn't statistically significant (p-value = 0.742), it suggests a negative correlation between enhanced public health initiatives and the scale of IFFs. Furthermore, the findings indicate that a higher density of physicians and urban population coverage positively impacts public sector accountability. These results resonate with existing literature that points out how a functional health infrastructure can both deter and serve as a diagnostic marker for illicit capital outflows. This study adds to the limited empirical research connecting IFFs with sectoral development outcomes, particularly in public health. The findings highlight an urgent call for integrated policy responses that tackle illicit financial flows (IFFs) by investing in the health sector and ensuring fiscal transparency. It's crucial for governments to implement strong anti-money laundering measures, enhance tax collection processes, and encourage regional collaboration to combat these illegal outflows. By improving public health outcomes—like increasing polio immunization rates—we can not only boost human capital but also minimize financial leakages, ultimately paving the way for sustainable development in Sub-Saharan Africa.

The rise in illicit financial activities across the South Africa–Zimbabwe corridor, with an estimated annual loss of $3.1 billion demands advanced AI solutions to augment traditional detection methods. This study introduces FALCON, a groundbreaking hybrid transformer–GNN model that integrates temporal transaction analysis (TimeGAN) and graph-based entity mapping (GraphSAGE) to detect illicit financial flows with unprecedented precision. By leveraging data from South Africa’s FIC, Zimbabwe’s RBZ, and SWIFT, FALCON achieved 98.7%, surpassing Random Forest (72.1%) and human auditors (64.5%), while reducing false positives to 1.2% (AUC-ROC: 0.992). Tested on 1.8 million transactions, including falsified CTRs, STRs, and Ethereum blockchain data, FALCON uncovered $450 million laundered by 23 shell companies with a cross-border detection precision of 94%, directly mitigating illicit financial flows in Southern Africa. For regulators, FALCON met FAFT standards, yielding 92% court admissibility, and its GDPR-compliant design (ε = 1.2 differential privacy) met stringent legal standards. Deployed on AWS Graviton3, FALCON processed 2 million transactions/second at $0.002 per 1000 transactions, demonstrating real-time scalability, making it cost-effective for financial institutions in emerging markets. As the first AI framework tailored for Southern Africa’s financial ecosystems, FALCON sets a new benchmark for ethical AML solutions in emerging economies with immediate applicability to CBDC supervision. The transparent validation of publicly available data underscores its potential to transform global financial crime detection.

This study addresses the critical challenge of detecting suspicious transactions in modern financial networks, focusing on the persistent threat of money laundering and related fraudulent activities. We propose a graph-based approach where each financial participant—whether an individual or an institution—is modeled as a node, and directed edges represent the flow of transactions. Using a dataset of anonymized banking records, we construct a directed graph and then calculate centrality measures, including degree centrality, betweenness centrality, closeness centrality, and eigenvector centrality. These metrics quantify how actively each node participates in or controls the circulation of funds across the network. Nodes characterized by particularly high values for betweenness or degree centrality emerge as potential “bridge” entities, acting as conduits for the majority of transaction paths. Our results indicate that these high-centrality participants may be key to understanding illicit financial flows, because they facilitate significant volumes of transactions or exert disproportionate influence by connecting otherwise separate sub-networks. Furthermore, a visualization of subgraphs around these nodes reveals tightly knit structures, suggesting the presence of possible hidden clusters that could be orchestrating complex money-laundering schemes. Overall, the proposed network-driven approach provides an efficient lens for early detection of suspicious accounts and transaction routes, especially when integrated with contemporary machine learning technologies for real-time analytics. The study concludes that centrality-based screening can enhance both the speed and accuracy of anti-fraud interventions, thereby strengthening the resilience of financial institutions in an increasingly data-rich and interconnected global economy.

Purpose The purpose of this paper is to assess how foreign direct investment (FDI) inflows may lead to money laundering in the United Arab Emirates (UAE) and examine how well the nation’s regulations protect against money laundering risks. Design/methodology/approach A systematic literature review is used as the primary research methodology to analyze existing scholarly and practitioner works related to the relationship between FDI and money laundering in the UAE from a legislative perspective. Findings The UAE has established national legislation targeting money laundering and terrorist financing (anti-money laundering [AML]/counter-terrorism financing [CFT]) through comprehensive laws such as Federal Law No. 20 of 2018, which serves as the foundation for the country’s regulatory regime. However, the review found that having multiple regulatory systems, including those in Dubai International Financial Centre and Abu Dhabi Global Market, could lead to gaps where FDI-driven money laundering might take place. Often, free zones try to attract foreign companies by putting fewer AML/CFT rules in place than the federal government requires. Research limitations/implications The UAE’s AML structure has improved, yet there is not much data to assess how well it works. Studies in the future should examine whether the decline in FDI-related laundering is linked to these reforms. Moreover, examining how the UAE’s regulatory model compares with those of other hubs such as Singapore, Switzerland or Hong Kong could identify strengths and weaknesses. A comparative study of compliance strategies and enforcement mechanisms would help highlight international best practices that the UAE could adapt to enhance its financial integrity and global competitiveness. Practical implications By offering recommendations, this paper provides practical insights for policymakers and regulators to strengthen the country’s AML/CFT framework and better manage the risks posed by foreign investments. The implementation of these recommendations will enhance the UAE’s reputation as a transparent and secure investment destination, attracting further legitimate FDI while protecting against illicit financial flows. Originality/value This study gives current and timely insights into the harms created by gaps between regulations, as well as practical recommendations for policymakers. The results of the research will be used to update current AML/CFT practices and handle the issues caused by a divided approach to oversight. A key takeaway is the need for a harmonized approach to AML/CFT regulations across all regions of the UAE to ensure consistency and reduce vulnerabilities to illicit financial activities.

Russia’s invasion of Ukraine has highlighted the role of illicit finance in shaping Russian foreign policy. This paper introduces a novel approach by conceptualising the link between illicit financial flows (IFF) and Russian foreign policy. Previous research has assumed that economic activities, often involving illegality, are central to Russia’s global influence strategies but has struggled to explain how this plays out and its consequences. Drawing on empirical evidence, we explore how IFF underpin Russia’s political interference, information campaigns, and military operations. First, we show that IFF are integral to Russia’s foreign and security policy, not as a primary driver but as a crucial tool in implementing policy. IFF support Russia’s political influence campaigns and information operations, often more effectively than state-run propaganda. Second, while strategic guidance is centralised, there is significant individual agency. Private backing is essential for political and ideological campaigns, enabling funders to pursue personal projects aligned with state interests. Third, the public and private realms are irretrievably blurred. Private actors often receive state contracts, and this “networked state” challenges classical political science models. We conclude that IFF are used as a revisionist tool in Russia, undermining international norms and creating structures that challenge the rules-based order.

Illicit Financial and Arms Flows in West Africa: An Assessment of Nigeria’s National Security Response and Resilience Framework

This paper examines the impact of capital flight on economic growth in Africa, highlighting the crucial role of institutional quality. Through an econometric analysis of data from 28 African countries observed during the 2000-2022 period, it is shown that capital flight significantly hinders growth by reducing the resources available for economic development. However, strong institutions can mitigate this negative impact through transparent and effective governance, notably by reducing corruption and enhancing political stability. The study recommends improving institutional quality to limit illicit financial flows and promote sustainable growth, while also emphasizing significant income-based disparities between countries.

The aim of this article is to analyze the role of regime durability in the relationship between illicit financial flows and violent conflict. The panel data used cover the analysis period from 2009 to 2018 on sub-Saharan African (SSA) countries. The estimation method used is Wang's nonlinear method. Results show that illicit financial flows increase violent conflict. First, illicit financial flows reduce violent conflict when regime durability is below the 22-year threshold. In a second stage, illicit financial flows increase violent conflict when the sustainability of the regime exceeds the 22-year threshold. In terms of economic policy implications, governments and policymakers are encouraged to reduce illicit financial flows by controlling false invoicing of exports and imports. They are also invited to reduce the number of years that regimes are in power in order to facilitate the reduction of illicit financial flows and violent conflicts.

Objective: This research aims to study the crime of terrorist financing under Algerian law, focusing on the legal provisions that address it, its elements and components, as well as the penalties prescribed for it. Theoretical Framework: This study relies particularly on the laws enacted by the Algerian legislator to combat the phenomenon of terrorist financing. It does so by attempting to analyze and interpret these laws, highlighting what they include in terms of criminalizing this phenomenon and the penalties established for it. Thus, the framework of the study is based primarily on legal texts rather than any other sources. Methodology: This article is based on the analytical method, by attempting to analyze the legal provisions related to the crime of terrorist financing. This includes studying and extracting the elements of the crime and the penalties prescribed for it. The descriptive method was also used, through the description of certain legal texts and laws and by presenting observations related to the topic. Results and Discussion: This research has led to several findings, the most important of which is that the Algerian legislator was among the first to criminalize the phenomenon of terrorist financing, considering it a form of terrorist act and prescribing for it the same penalties. Moreover, the Algerian state has ratified numerous international conventions and treaties related to combating and preventing terrorism and its financing, both at the global level under the United Nations and at the regional level within the framework of the African Union and the League of Arab States. These treaties have served as an important source for domestic legislation, especially in matters related to international cooperation in extradition and the monitoring of illicit financial flows directed toward financing terrorism and organized crime. Research Implications: This research highlights the efforts made by Algeria through its legislative system to combat the crime of terrorist financing, given the threat it poses to the security and stability of states as well as global peace and security. Moreover, the study is expected to enrich the scientific literature related to this subject. Originality/Value: The originality of this research lies primarily in its reliance on direct sources, namely national laws and international treaties and conventions published in the Official Journal of Algeria, which adds value to the research in this field.

This paper explores the role of the International Criminal Court (ICC) in addressing transnational financial crimes and the challenges facing it. Because of the acceleration of globalisation, crimes like money laundering, tax evasion, corruption, and terrorist financing have become common tools for global criminals. Since the ICC primarily prosecutes war crimes, genocide, and crimes against humanity, its current legal framework does not extend to financial crimes. By finding the ICCs jurisdictional limitations and real-world case studies, this paper reveals how gaps in international law create openings for financial criminals to act with little fear of prosecution. To bridge these gaps, it proposes key reforms, including expanding the ICCs jurisdiction, improving its technical and investigative capabilities, and stimulating stronger global cooperation. In the end, this paper points out that tackling financial crime worldwide requires a more adaptive and cooperative approach to ensure justice systems can keep pace with the ever-changing tactics of financial criminals.

Money laundering continues to pose major challenges for financial institutions and regulators, with the United Nations Office on Drugs and Crime reporting that 2–5% of global GDP is made up of illicit financial flows worldwide. The US financial sector is navigating the changing technology landscape of anti-money laundering (AML), with increasing emphasis on machine learning (ML)/ deep learning (DL) and the emergence of 6G telecommunications in combating financial crimes. This paper reviews existing implementation approaches, performance measures, and ongoing challenges surrounding Machine Learning, Deep Learning, and 6G Technologies in Anti-Money Laundering in the U.S. by investigating publications such as academic articles, regulations, and industry reports covering 2018 to 2025. The result of the research suggests that while ML/DL methods show enhanced detection rates and efficiency over traditional rule-based systems, questions about regulation, explainability, and data quality remain significant challenges that must be addressed to ensure their responsible and effective deployment. Moreover, the study found that though 6G technology provides useful features for advanced real-time monitoring to prevent money laundering, it introduces unprecedented challenges in regulation, cost, and data privacy. This review provides a holistic framework for banks and policymakers to pragmatically and progressively embed technological solutions into banks’ anti-money laundering processes and address technical, organizational, and regulatory barriers in anti-money laundering in the U.S.

The rapid development and adoption of digital currencies are driving significant changes in the global financial system, with profound implications for national security and global power dynamics. State-backed digital currencies, such as Central Bank Digital Currencies (CBDCs), offer new opportunities and risks in terms of sovereignty, financial control, and data security. Countries may use digital currencies to reduce reliance on the U.S. dollar, potentially challenging its global dominance and weakening American geopolitical influence. At the same time, digital currencies raise concerns about money laundering, terrorism financing, and the ability of governments to monitor illicit financial flows, making them a critical issue for national and international security frameworks. Moreover, the use of digital currencies in cross-border transactions could allow countries to bypass traditional financial systems like SWIFT, reducing the effectiveness of economic sanctions as a tool of foreign policy. This is particularly relevant as nations such as China and Russia explore digital alternatives to protect their economies from Western financial pressure. The strategic implementation of CBDCs can also enhance state control over domestic economies, enabling real-time monitoring and regulation of financial activity, which can be both a strength and a potential threat to individual privacy and democratic norms. On a broader scale, the rise of digital currencies may lead to the emergence of new financial alliances and blocs, reshaping global economic hierarchies. Technological leadership in digital finance could become a key aspect of geopolitical competition, with countries investing heavily in blockchain infrastructure, cybersecurity, and digital payment ecosystems. Ultimately, digital currencies are not just financial instruments but tools of influence, control, and power projection in the evolving international order