Many kleptocrats, oligarchs and others need support to move, launder, spend and invest their illicitly acquired wealth. To do so, they rely on the services provided by ‘enablers’: those people and professions that make illicit financial flows (IFFs) possible. These include lawyers, financial experts, bankers, accountants and real estate agents, to name just a few. These ‘trusted experts’ are as global as the kleptocrats, although a large proportion of their services are based in OECD countries – countries that also provide a large amount of official development assistance.

Illicit financial flows (IFFs) schemes from kleptocrats have four general stages. Each step reveals some of the ways that enablers provide support. It is important to note that many enablers may be acting in good faith, with no knowledge of the schemes they are part of, nor an accurate idea of the origin of funds they are working with.

Enablers provide support to kleptocrats to set the IFFs scheme in motion, eg through complex corporate structures and bank accounts in multiple jurisdictions (step 1). Various enablers can be involved such as consulting firms, accountants, tax advisory firms, law firms and corporate service providers. Enablers then help kleptocrats to disguise the proceeds of corruption or tax evasion (step 2). The involvement of domestic and international banks is an absolute necessity. Once the proceeds of corruption and tax evasion are circulated through multiple companies, bank accounts and jurisdictions, they are directed back into the hands of kleptocrats for them to enjoy (step 3). Law firms and real estate agents are crucial enablers. Kleptocrats often want to improve their reputations at home and abroad. They will work with a certain type of enabler to acquire a new clean image (step 4). For example, lawyers will launch lawsuits known as strategic litigation against public participation (SLAPP) to silence critical voices.

The U4 Issue also explores the role of three OECD countries in enabling IFFs: the US, Switzerland and the UK. These countries were among the main providers of official development assistance in 2021. At the same time, they ranked (respectively) as the 1st, 2nd and 13th most secretive jurisdictions worldwide by Tax Justice Network in 2022.

Lastly, the U4 Issue makes 20 recommendations for governments of donor countries to make the work of enablers more difficult. These cover legislation and policy, accountability, and enforcement. For the full list see the U4 Issue, but some examples include:

• Close loopholes that allow foreign companies to purchase assets without identifying their beneficial owners.
• Establish a free public central register of wealth and assets and their beneficial owners.
• Set up a task force team from different government institutions to ensure coordination (eg, similar to task forces put in place to trace assets from Russians under sanctions).