Illicit financial flows from migrant smuggling

This research paper examines illicit financial flows (IFFs) stemming from migrant smuggling in Senegal and Sierra Leone. It analyzes how smuggling proceeds are generated, moved through formal and informal channels, and laundered into legitimate sectors. The report highlights a significant gap between the existence of anti-money laundering policies and their practical implementation, noting that financial intelligence units in both countries lack the resources and expertise to effectively 'follow the money' in smuggling cases.

• Migrant smuggling generates substantial global and regional profits, with annual global profits estimated at over $10 billion and profits from East, North, and West Africa to Europe estimated at approximately $6.57 billion. Moderate estimates for flows from West Africa to Europe alone exceed $100 million.
• Senegal serves as a critical regional hub and transit point for Sierra Leonean migrants. This includes the use of 'safe houses' in Diamniadio and employment in the Kédougou gold mine to raise funds for further travel to Europe or the Middle East.
• Smugglers utilize a variety of payment models, including 'pay-as-you-go' (where payments are made at specific legs of the journey), 'full-package' options, and 'travel now, pay later' arrangements. Fees for full-package trips to the Middle East range from $800 to $1,200, while trips to Europe range from $1,000 to $1,500.
• Illicit proceeds are frequently moved through informal channels to avoid detection, specifically the hawala system and foreign currency black markets. These methods allow for anonymous, paperless transfers that bypass formal financial regulatory frameworks.
• Smugglers launder their proceeds by investing in several key sectors in their countries of origin or residence. These include real estate, the hospitality industry (clubs, bars, restaurants, hotels), second-hand vehicle sales, travel agencies, mining, and faith-based or charity organizations.
• Despite having anti-money laundering laws, Senegal and Sierra Leone rarely investigate migrant smuggling as a predicate offence for money laundering. Financial Intelligence Units (FIUs) in both nations are underfunded and understaffed, lacking the capacity for independent investigations.
• In Sierra Leone, investigations are further hindered by the reluctance of witnesses to testify due to the perceived social value of smugglers and alleged complicity of security forces and judicial officials.

APA

Ani, N. C., & Shahid, J. (2023). Illicit financial flows from migrant smuggling. Institute for Security Studies. https://issafrica.s3.amazonaws.com/site/uploads/ocwar-t-paper-4-eng.pdf

Chicago

Ani, Ndubuisi Christian, and Jennifer Shahid. Illicit financial flows from migrant smuggling. Institute for Security Studies, 2023. https://issafrica.s3.amazonaws.com/site/uploads/ocwar-t-paper-4-eng.pdf.

Wikipedia

{{cite report |last1=Ani |first1=Ndubuisi Christian |last2=Shahid |first2=Jennifer |title=Illicit financial flows from migrant smuggling |publisher=Institute for Security Studies |date=July 2023 |url=https://issafrica.s3.amazonaws.com/site/uploads/ocwar-t-paper-4-eng.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ani2023illicit, author = {Ani, Ndubuisi Christian and Shahid, Jennifer}, title = {{Illicit financial flows from migrant smuggling}}, institution = {Institute for Security Studies}, year = {2023}, month = jul, url = {https://issafrica.s3.amazonaws.com/site/uploads/ocwar-t-paper-4-eng.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }