Financial Crimes Investigations

Author: Omayra Chuquihuara

Executive Summary

The digital era has created new opportunities for criminals to undertake financial crimes in cyberspace. This is the case for the expansion of Illicit Financial Flows (IFFs) on social media platforms such as Facebook. While the threat of IFFs is not new, the increasing use of social media networks is challenging the status quo of criminal investigations led by the United States Secret Service Office of Investigations (USSS-INV) and its partner Law Enforcement Agencies (LEAs). Investigations have shed light to the fact that criminals are using social media platforms to perpetrate IFFs through all three pillars of the chain: earn, transfer, and use. Whether anonymously or not, criminals are able to recruit targeted victims, transfer money, and flaunt purchased goods with illegal proceeds all in one same digital space.

This report focuses on assessing the existing methods of collaboration between LEAs, Facebook, and third-party groups to provide the USSS with policy recommendations on improving cooperation. While the ongoing debate on regulation is important for social media curation, this report does not focus on the legislative and regulatory stance of the equation but rather on the implementation approach and analyzes the potential avenues for collaboration to enhance existing protocols for criminal investigation success on financial crimes. Given the limited research on the use of social media networks as facilitators of IFFs, this report presents preliminary findings on Facebook specifically, with the aim of scaling the research to other social media platforms in the long run.

In the first section, the author presents a framework to better conceptualize the complexity of IFFs on social media platforms before presenting the case for the research on Facebook per se. Through informational interviews with relevant stakeholders, the report identifies the three types of processes that currently exist for collaboration as well as the main challenges for them: bureaucratic processes, limited human and financial resources, and ambiguous gray area for IFFs on social media platforms. For this research, the insights from the public and private sectors were key for anecdotal cases on investigations and final recommendations.

The policy recommendations, resulting from the proposed framework and subsequent analysis on existing collaboration and barriers to success, focus on three stakeholders: LEAs, Facebook, and non-governmental actors. While this report is intended for use by the USSS-INV, the collaborative nature of its mandate resulted in the need to understand the actions needed from each sub-group. These proposed actions in the policy recommendations section cover initiatives on streamlining processes, improving communications, supporting legislation, adapting to a new understanding of IFFs on social media platforms, among others.