Moody’s has recently unveiled alarming data indicating a significant escalation in modern slavery incidents and money laundering operations throughout Europe over the last five years.
According to the information gleaned from Moody’s Grid database, a comprehensive repository of data covering a spectrum of money laundering and modern slavery instances ranging from allegations to convictions, Europe is witnessing a worrying increase in such activities.
From 2018 to 2023, the incidents of modern slavery saw a notable increase of nearly 17% in just one year, jumping from 18,335 to 21,626. This surge is particularly pronounced when compared to the 2018 figure, which stood at 10,277 incidents. Italy has been at the forefront of this grim statistic, with an estimated 32,000 incidents of modern slavery reported over the last five years. France and Spain followed, with approximately 18,000 and 13,000 incidents, respectively. Meanwhile, the UK saw its numbers nearly double from around 12,500 to 24,000 incidents during the same period.
Parallel to the rise in modern slavery, the incidence of money laundering across the continent has also increased sharply by 25% annually from 2018 to 2023, a rate 8% higher than the global average. The UK emerged as the hotbed for money laundering activities in Europe, accounting for 29% of all reported incidents. Italy and Russia followed with 16% and 12%, respectively. A significant portion of these money laundering activities, over 10%, has been directly linked to human trafficking, highlighting the deep interconnection between various forms of financial crimes.
Moody’s further explores these issues in “The Infinite Game”, a documentary shedding light on the evolving threat of financial crime to legitimate businesses. The film showcases interviews with industry experts and journalists, delving into specific cases and the broader societal impacts of such crimes.
Keith Berry, the General Manager of Know Your Customer Solutions at Moody’s Analytics, stressed the complexities and challenges that organisations face in combating these crimes. He emphasized the importance of rigorous due diligence, pointing out that almost all criminal endeavours aim to legitimize illicit funds, a process that creates an entire industry of financial crime.
Berry underscored the link between human trafficking and money laundering, noting the growing sophistication and interconnectedness of financial crimes and their exploitation of vulnerabilities within the financial system. He called for enhanced modern due diligence measures by governments, corporates, and all organisations to safeguard against money laundering and the illicit activities it facilitates.
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