By United Nations Office on Drugs and Crime (UNODC)

  As defined in the Conceptual Framework for the Statistical Measurement of Illicit Financial Flows,  Illicit Financial Flows (IFFs) are “financial flows that are illicit in origin, transfer or use,that reflect an exchange of value and that cross country borders.”IFFs may arise from criminal activities, but also from some behaviours related to tax and commercial practices. Such flows are either directly generated by illicit income, including cross-border transactions performed in the context of illicit trade of goods such as drugs, or the management of illicit income through investment in financial and non-financial assets. National data on IFFs remain limited worldwide, but significant progress has been made since 2017, when the UN Assembly adopted indicator 16.4.1. ("Total value of inward and outward illicit financial flows") for the monitoring of progress towards Sustainable Development Target 16.4, which aims to significantly reduce illicit financial and arms flows by 2030.  The United Nations Office on Drugs and Crime (UNODC) was entrusted, alongside the United Nations Commission on Trade and Development (UNCTAD), with the custodianship of SDG indicator 16.4.1. The International Classification of Crime for Statistical Purposes (ICCS)  provides definitions of illegal activities generating IFFs. Moreover, since 2017, UNODC and UNCTAD have taken a series of coordinated actions leading to a conceptual framework for the statistical measurement of IFFs, the implementation of pilot measurement exercises and the development of methodological guidelines to measure IFFs from selected illegal market activities. Additionally, in October 2019, the 10th session of the Inter-agency and Expert Group on Sustainable Development Goals Indicators,  held in Addis Ababa, reviewed the methodology and reclassified the indicator from Tier III to Tier II, meaning that the indicator is conceptually clear and has set out internationally established standards, although data are not yet regularly produced by countries. This document details the crime-related IFF estimates resulting from the engagement of UNODC with countries to implement the methodology outlined in the UNODC-UNCTAD conceptual framework.

Vienna: UNODC, 2023. 23p.