Presentation on theme: "Threat, risk (organised) crime an d Crime-money (laundering)"— Presentation transcript:
Threat, risk (organised) crime an d Crime-money (laundering)
Past, present and “OC threat/risks Past, present and “OC threat/risks” 2001: European Multidisciplinary Group declared: “We looked back; we must look forward!” Therefore: “Future oriented” reporting: the future of OC = the future of its threat/risk What is threat or risk? And what is an ‘organised crime risk’?
The simple risk formula Risk = p = ∑x i /N (per time unit) = threat = the likelihood that an event x of a certain class Y will occur given the total set of events. Could policy makers please substitute the x and Y? Y is a closed definition of a class of events x = single event of class Y ∑x i-time = time series of events Apply that to organised crime assessment
Finding an insurance policy against “organised crime” Basic thesis: every determinable harm can be insured if a likelihood can be determined. What does an insurance firm do with a new risk? (a) it determines the meaning of the class of events Y, then its total N (b) it designs a time series = past events x (c) the costs of events (classified harm) and fills the formula
Finding an insurance policy against organises crime: continued What did the EU policy makers do? (a) they formulated a fuzzy definition and (b) threw away the past. Just try to make a time series. What can an insurance firm do?
The desperate insurance firm What can an insurance firm do? It cannot sell an OC insurance policy because there is no determinable risk! (Or serious crime): no x and no Y On what basis to assess OC crime risk? If no proper definition, no OC insurance risk Only con men can sell such policies!
The desperate insurance firm (continued) Are policy makers con men? They sold you multi-million policies EUROPOL Organised Crime Threat Assessments Transnational Organised Crime Convention Anti-money laundering regime All to make us feel secure!
The insurance firm perseveres!! Continue with our insurance man. What can he do? He must keep the OC banner: excellent commercial label never abandon a winning formula! Next: some correlation with a criterion variable.
The insurance firm perseveres!! (continued) For example: Breakdown of social-economic or criminal variables against criterion variable = “Foreign direct investment” (Daniele and Marani; Italy) OC and investment: negative correlation but ≠ causal relation, because Underlying variable: mal governance and corruption.
The unmarketable exception clause The underlying variable: mal governance and corruption. The ‘Berlusconi exception clause’! How to sell such an insurance product? Determining the threat of mal governance and sell corruption risk policies. Commercial challenge for Transparency International, but otherwise unsalable.
The threat of crime money The global threat since the 1980s. Basic concern: threat to the financial system integrity Which criminal is going to cut the branch on which he is sitting? Grubby banks are dangerous.... for launderers:
The threat of crime money (continued) Calvi: hanging from Black Friars Bridge Sindona (poison) + lawyer shot Russian bankers (a too long series for a slide) Nugan Hand Bank (Australia, suspicious suicide) European Union Bank ($ 10 million lost) Most recent launderers’ risk: unreliable bank employees selling CDs with names to the fiscal authorities!
The criminal risk industry Instead of “threat thinking”: The real question: What is the role of crime money within the financial system? Again: no data, but an abundance of threat images benefiting the compliance industry. Lot of juggling with trillions by IMF, OEDC, World Bank, FATF: mutually copy-pasting figures and threats A (financial) risk industry
Copy-pasting threats ‘Affects currency movements’ ‘Destabilises banks by sudden withdrawals’ ‘Influences interest rate’. ‘Distorts the GDP’. ‘No optimal investment’ (remarked by “Ponzi-bankers”!)
The risk of laundered and unlaundered money What is the harm of laundered money? Part of the GDP: where is the danger? Taxable But there is moral harm: crime should not pay + corrosion of morals
The risk of crime-money and corruption More corruption? white All big corruption scandals in EU concerned white money! Unlaundered money What is the threat? Luxury lifestyle? What is the difference with our greedy irresponsible Ponzi-bankers? If laundered properly, no longer a threat!
The role of crime money on-going research The Dutch confiscation database: statistical mud track since 1994 “Threatened” sector real estate: skewed division but: Mean € 182.000 / median € 150.000 mean value bank account: € 263.000 / median € 20.000 € 100.000 + : 90 € 1.000.000 + 11 94 % Dutch bank accounts < € 100.000 The role of crime money: less prominent, certainly not threatening, unless falsified by better data!
Do what you are (hopefully) paid for Falsify, falsify, falsify, until the hypothesis do not crack. Identify your ‘risk’ counting unit: no risk assessment without : ∑x i-n/time Get to your database owners and hold them accountable: they are your (democratic) knowledge source.
Thou should not hide knowledge “We are the people”, researchers too, And have the right to know. If no data access: sue them under your Freedom of Information Act If you don’t dare, just join the collective risk assessment ritual dance of the conferences.