What do illicit financial flows mean for developing countries?

Illicit financial flows (IFFs) are generated by methods, practices and crimes aiming to transfer financial capital out of a country in contravention of national or international laws. The funds strip urgently needed resources from developing countries, which then lack means to finance their development efforts. Illicit financial flows generally fall in one of four categories: money laundering, bribery and tax evasion by international companies, and trade mispricing. There are many international initiatives underway that aim at combatting illicit financial flows. OECD countries have a large role in this agenda, as OECD country systems in this area often exhibit weaknesses.