The Bigger Picture … Illicit Trade and Threat Financing

May 23, 2017

Friday marks the start of the GLOBSEC 2017 forum in Bratislava.

GLOBSEC is an independent, non-partisan, non-governmental organization with the primary goal to shape the global debate on foreign and security policy through research and connecting key experts.

The weekend-long forum is a pinnacle event in the global security policy calendar, gathering numerous world leaders and top experts all with the collective focus of making the world a safer place.

On Saturday 27 May, I will take part in a panel discussing links between illicit trade in tobacco and the funding of organized crime and terrorism entitled Threat-Financing: Money, Illicit Trade and (In) Security. I look forward to sharing the views of Philip Morris International and hearing from policy makers and experts in the field of security how we can work together, find solutions, and cut off the revenue streams that fund terrorist activities.

We all dream of waking up in a world free from crime, free from terror, free from fear. While many of us are fortunate to lead peaceful lives, daily headlines highlight the potential threats civilized societies face. The recent terror incidents in Europe provide a shocking reminder of the clear and present dangers that exist.

We must all do our bit to strive for a safer world, including me in my capacity leading Philip Morris International’s operations combating tobacco illicit trade. 

Trade in illicit products goes beyond putting the safety of consumers worldwide at risk and robbing governments, businesses and communities of tax revenues, profits and legitimate jobs. Links between illicit trade in tobacco products and the funding of terrorism have been acknowledged for some time.

The 2016 OECD report “Illicit Trade, Converging Criminal Networks” concluded: “Illicit trade in tobacco represents a multifaceted crime which may involve counterfeiting, cross-border smuggling and tax evasion, and which has also been identified as a source of revenue for terrorist activities in several areas.”

Every day, consumers around the world unwittingly contribute to the eco-systems fostering groups hell-bent on attacking and destroying civilized societies.

Philip Morris International (PMI) is taking a leading role in fighting back. We have put in place internal policies to secure our supply chain and to protect our brands, and we continue to work in partnership with law enforcement agencies in countries worldwide, investing in education and training of public officers in charge of monitoring this issue, and raising general awareness about this serious crime.

In 2016 we established 18 new agreements for direct cooperation and support to governments and conducted 85 training sessions with over 2,000 officials in 13 different countries. Our Greek affiliate Papastratos, donated an advanced mobile x-ray scanner, valued at €2 million, to the Greek customs authorities in 2016, which will help stop criminal activity in its tracks.

Find out more about how we are leading the battle against illegal cigarettes here.

To eradicate the illegal activities that hurt the economy and threaten society’s security is a goal too challenging for any one group, government, or company to achieve alone. In 2016 we established PMI IMPACT, a first-of-its-kind global initiative to support public, private, and nongovernmental organizations to develop and implement projects against illegal trade and related crimes such as corruption, money laundering, and organized crime. PMI has pledged USD 100 million for three funding rounds. 

The centerpiece of PMI IMPACT is an independent Expert Council, whose members oversee grants for projects ranging from research initiatives, to awareness programs, to on-the-ground activities. The Expert Council evaluates project proposals, selects the applications for the award of grants by PMI, and reviews the progress and the results of the projects during their implementation.

In the first funding round for PMI IMPACT, a total of 170 organizations including government agencies, universities and research institutes, NGOs, and private entities have proposed more than 200 projects under three focus areas: research, education and awareness, and action. Submissions came from 42 countries, primarily in Europe and North America.

Threat-financing and how to tackle it is complex, and requires collaborative efforts and direct action from all quarters, including regulators, industry, the security community, law enforcement, and consumers themselves.

The big question is: how can the security community work with partners to cut off the illicit trade revenue stream funding terrorism?

Alvise Giustiniani

Written by Alvise Giustiniani

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