Fraud and financial crime are among the greatest inhibitors to the stability and prosperity of organisations, institutions and economies around the world – in both developed and developing jurisdictions alike. Fraud is the crime to which most people are likely to fall victim. However construed, be it sophisticated and complex commercial frauds, insider dealing, market manipulation, money laundering, bribery, terrorism financing or tax evasion, these are everdeveloping, transnational threats to which meaningful and innovative thinking is required in response. While an ethos of “shared values, shared approaches” underpins the global antieconomic crime framework, particularly vis-à-vis money laundering and financial regulation, a onesize-fits-all approach often omits important contextual challenges across different jurisdictions.
For lawyers and investigators, only a more nuanced approach taken to the subject of fraud, financial crime and asset recovery will enable us to understand and properly articulate what the real challenges are at international, regional and domestic levels – both practically, and theoretically. Thereby, more meaningful and practical cooperation and collaboration can be facilitated.
In recent years, financial crime has been an increasingly regular subject in the news media. It has been seen in successive breaches of confidential data from law firms in the offshore world (such as the Bahamas leaks, the Panama and Paradise papers) and from enforcement authorities and regulators (such as the FinCEN files). Cases are increasingly high-profile involving some of the world’s most well-known institutions. In terms of enforcement efforts, new civil and criminal tools are rapidly being designed and deployed beyond traditional recovery mechanisms or use of the criminal justice system – including deferred prosecution agreements to deal with complex international bribery allegations and AML breaches against large financial institutions, as well as new mechanisms such as unexplained wealth orders being used to target suspicious wealth of politically exposed persons, or those involved in serious crime.
While the mechanisms of case disposal, recovery or restitution have advanced, so too have the abilities of criminals to utilise innovative methods to perpetrate misconduct and conceal their illicit gains. These are impacting on insolvency and bankruptcy proceedings, and increasing the complexity of asset structuring and transaction chains. As the Covid-19 pandemic has acutely demonstrated, cyber-fraud and related misconduct is increasing. So too are the abilities to utilise under-regulated crypto-assets while systems of law around the world make their mind up about the nature of such ‘property’ and its regulation. Further, bad actors are utilising advancing technologies to perpetrate wrongdoing, and conceal or transact assets in non-traditional ways. Of course, the other side of this is that financial technologies are assisting practitioners and investigators exponentially with recovery efforts, as well as transnational enforcement operations, information sharing, cooperation and mutual assistance.
Just as we are experiencing new and innovate threats, practitioners and the professions are faced with increasing regulatory and legislative obligations. Further, international financial and business centres, particularly ‘offshore’ markets, appear subject to growing, and perhaps disproportionate, pressure to change their models and comply with standards which are not yet global norms.
The Inaugural FraudNet Global Report 2021 draws upon the collective knowledge and experience driven insights of its Members and Strategic Partners – all leaders in their interrelated fields of practice and who are at the forefront of some of the world’s most high-profile, legally impactful and sensitive asset recovery cases involving fraud and related misconduct. The Report showcases thought-pieces, briefings and analyses from across the globe. Its aims are to strengthen the research and intellectual arm of the world’s leading asset recovery lawyers’ network, and to provide contemporary insight to existing and potential clients about some of the most pertinent issues facing our field and the type of subjects the Members and Strategic partners regularly encounter in their work.
Articles encompass a useful mix of case studies, theoretical discussions, and practical solutions based insight. They cover a range of themes of timely importance, including developments in criminal and civil asset recovery initiatives such as economic substance requirements, beneficial ownership and corporate transparency, ‘offshore’ issues, fraud and insolvency, cybercrime and security, evidential and ethical considerations, unexplained wealth and account freezing orders, forged commodities, crypto-assets and their regulation, and forensic analysis. Practical illustrations and examples, particularly from the different regions represented in the report, adds context to complex and developing areas of law. The Report also includes articles from leading academics associated to FraudNet, who are engaged in ongoing research in the field.
The articles also provide comment, analysis and evaluation of some recent landmark legal judgments and their practical implications, enactment of new legislation and regulatory obligations. It also considers how technological solutions can assist clients in asset recovery, as well as casting practical predictions about their application and scope. Drawing upon the authors’ individual professional experiences, useful learning outcomes and implications are proffered.
The Covid-19 pandemic has created an environment of dangerous opportunity, which is acknowledged across many of the papers in this Report. It is hoped that the articles are of utility and interest to existing and prospective clients and associates of the ICC FraudNet network, as well as provide valuable contributions to important and ongoing debates in the field. In this regard, it is also hoped that the Report will be of wider use to legislators, policymakers, investigators, researchers and scholars alike seeking to better enhance their understanding and contemporary awareness of important developments in this field across the globe, many of which are covered insightfully and analytically in these papers.
Publications in this field are hardly lacking, however this Report is rather unique as it demonstrates individual insights of practitioners but also the broad experience of the network – which is its value proposition as the world’s leading asset recovery lawyers’ network. It is the Members and Strategic Partners’ united belief that mutual collaboration at the transnational level can be of significant utility when assisting the victims of fraud and economic crime as they seek recompense in complex circumstances, often with transnational elements.
It is hoped that the readers of this Report find the papers herein most useful and insightful.
Dr Dominic Thomas-James
Editor, ICC FraudNet Global Annual Report
