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Estimates of illicit financial flows

Nonetheless, there are a few methods that are currently used to attempt to estimate some of the components of an illicit flow. These tend to concentrate on selected elements of IFFs, and thus do not give a global picture of the size or nature of illicit flows. For example, one methodology starts with errors and omissions in official trade statistics as a proxy for illicit flows. An alternative measure starts from estimates on the proceeds of crime. However, the data sources are generally not robust in measuring changes or determining trends across years.

The lack of an agreement on a definition makes developing methodologies for monitoring and assessment of progress difficult. There are also well-known disagreements and dissatisfaction with some of the methods currently utilized to estimate the volume of IFFs. In part, the problems stem from continued lack of conceptual clarity, but fundamentally, given the illicit nature of the flows, approaches to estimates will have problems in accurately capturing the phenomenon due to inadequate and incomplete sources of data.

Gross flows for bilateral differences between export and import values at the product level (Harmonized System six-digit codes) covering 22 jurisdictions in the Arab region, in current prices. Differences due to limited data or values of less than $1 million between countries and products were excluded.

Aggregated gross outflows for the bilateral differences between export and import values at product level (Harmonized System six-digit codes) for 33 ECLAC Member States. Results are inversely weighted for differences in volume of goods to correct for inadvertent misreporting.
The three regions with updated data—Africa, the Arab region and Latin America and the Caribbean—report that trade misinvoicing, while still large, has declined. Mismatched trade figures in non-renewable natural resource exports were large factors in these estimates.