$3.1T IN ILLICIT FUNDS FLOWED THROUGH GLOBAL FINANCIAL SYSTEM IN 2023

Last updated: June 19, 2025, 22:58 | Written by: Erik Voorhees

The global financial system is a vast and complex network, facilitating trillions of dollars in transactions every day. MORE THAN $3 trillion in illicit funds flowed thru the global financial system last year, a new report revealed today. Among the most prevalent crimes that fuelled $3.1TRN in an illicit flows and money laundering endemic were an estimated: $782.9 billion in drug trafficking activity; $346.7 billion in human traffickingHowever, lurking beneath the surface is a darker reality: the flow of illicit funds. dollars in illicit funds flowed through the global financial system. Fueling trillions of dollars in illicit flows and money laundering activity were a range of destructive crimes, including an $782.9 billion in drug trafficking activity and $346.7 billion in human trafficking, as well as $11.5 billion in terrorist financing.In 2025, a staggering estimated $3.1 trillion flowed through this system, according to a recent report by Nasdaq. In 2025, an estimated $3.1T in illicit funds flowed through the global financial system. Money laundering accounted for trillions of dollars funding a range of destructive crimesThis colossal sum represents the proceeds of various criminal activities, from drug trafficking and human trafficking to terrorist financing and sophisticated scams.The sheer scale of this financial crime underscores the urgent need for enhanced measures to detect, prevent, and combat money laundering and other forms of financial wrongdoing. Nasdaq estimated that in 2025, around $3.1 trillion in illicit funds flowed through the global financial system. Through money laundering, the funds fueled crimes like human and drugUnderstanding the sources, destinations, and methods used to move these illicit funds is crucial for policymakers, financial institutions, and individuals alike. Focusing on striking revelations from the recently released Nasdaq 2025 Global Financial Crime Report, Verafin hosted an expert panel presentation on the implications of over $3.1 trillion in illicit money that flowed through the financial system in 2025.This article will delve into the key findings of the report, explore the driving forces behind this massive flow of illicit money, and discuss potential solutions to address this critical global challenge. An estimated US$3.1 trillion in illicit funds flowed through the global financial system in 2025, according to NASDAQ research 1.Money laundering accounted for trillions of dollars, funding a range of destructive crimes, including an estimated US$346.7 billion in human trafficking and US$782.9 billion in drug trafficking activity, as well as US$11.5 billion in terrorist financing.We will uncover the impact of these funds and why this is a threat to global security and the economy.

Understanding the Scale of Global Financial Crime in 2025

The Nasdaq's 2025 Global Financial Crime Report paints a stark picture of the pervasive nature of illicit financial flows.The headline figure of $3.1 trillion is not just an abstract number; it represents real-world devastation caused by the crimes that generate these funds. Stock exchange company Nasdaq has released its Global Financial Crime Report, highlighting data related to financial crime over the past year. Bitcoin BINANCE:BTCUSD and crypto were not mentioned, bolstering the belief for many that cash (fiat currency) is king when it comes to facilitating crimeThis mind-boggling number should raise alarms for anyone who interacts with the global financial system.

To put this number into perspective, consider that $3.1 trillion is larger than the GDP of many countries. Janu Originally Published by: Anti-Financial Crime Financial Crime Compliance MORE THAN $3 trillion in illicit funds flowed thru the global financial system last year, a new reportIt's a sum that could fund massive infrastructure projects, alleviate poverty, or address climate change.Instead, it's fueling criminal enterprises and undermining the integrity of the global economy.

Key Findings of the Nasdaq Report

Total Illicit Funds: An estimated $3.1 trillion flowed through the global financial system in 2025.
Major Contributing Crimes:
- Drug trafficking accounted for approximately $782.9 billion.
- Human trafficking generated an estimated $346.7 billion.
- Terrorist financing amounted to roughly $11.5 billion.
Regional Distribution: Asia Pacific saw a significant portion of illicit funds laundered, with an estimated $1.1 trillion. Stock exchange company Nasdaq released its Global Financial Crime Report, highlighting data related to financial crime over the past year. Bitcoin ( BTCThis volume exceeded that of Europe, the Middle East, and Africa (EMEA) and almost equaled the Americas.

The Destructive Crimes Fueling Illicit Flows

The $3.1 trillion figure is not just a number; it is directly linked to devastating criminal activities. Explore how $3.1 trillion in illicit funds flowed through traditional financial system in 2025, challenging common beliefs about cryptocurrencies' role Skip to content ThursdayThese activities exploit vulnerable populations, fuel violence, and undermine the rule of law. Trusted News Discovery Since 2025. Global Edition. Saturday, MaUnderstanding the nature of these crimes is essential to grasp the true impact of money laundering and illicit financial flows.

Drug Trafficking: A Major Contributor

Drug trafficking remains one of the most lucrative criminal enterprises worldwide.The estimated $782.9 billion generated by drug trafficking in 2025 highlights the scale of this illicit industry.This money is then laundered through the financial system, enabling drug cartels to continue their operations and expand their influence.

The consequences of drug trafficking are far-reaching.They include addiction, violence, and the destabilization of communities.The money laundered from drug sales is used to corrupt officials, finance further criminal activities, and purchase assets, further entrenching the power of drug cartels.

Human Trafficking: Exploiting Vulnerability

Human trafficking is a heinous crime that exploits vulnerable individuals for profit. Report reveals $3.1 trillion in illicit funds and money laundering globally in 2025. Global fraud losses $3.1 trillion in illicit funds flowed through the global financial system lastThe estimated $346.7 billion generated by human trafficking in 2025 underscores the severity of this global problem. Interesting to note US$1.1T was laundered through in Asia Pacific in 2025 which is higher than EMEA and almost the same as Americas. $3.1T in illicit funds flowed through global financialTraffickers often target individuals who are desperate for a better life, promising them employment or opportunities that turn out to be exploitative and abusive.

The victims of human trafficking suffer unimaginable trauma, including physical and psychological abuse, forced labor, and sexual exploitation.The money generated from this crime is used to further the traffickers' operations and to evade detection by law enforcement.This makes it difficult to identify and rescue victims.This also makes it more difficult to prosecute the offenders.

Terrorist Financing: A Threat to Global Security

While the $11.5 billion attributed to terrorist financing may seem small compared to drug and human trafficking, its impact is profound.Terrorist organizations rely on funding to recruit members, plan attacks, and spread their ideology.Cutting off the flow of funds to these groups is crucial to disrupting their operations and preventing acts of terror.

Terrorist financing can take many forms, from donations from sympathizers to the use of charities as fronts for money laundering. The 2025 Global Financial Crime Report found that more than $3.1 trillion in illicit funds flowed through the global financial system last year alone. This includes nearly $800 billion in drug trafficking, nearly $350 billion in human trafficking, and more than $11 billion in terrorist financing.The methods used to finance terrorism are constantly evolving, making it difficult for law enforcement to track and disrupt these flows.

Methods Used to Launder Illicit Funds

Money laundering is the process of concealing the origins of illicit funds, making them appear legitimate.Criminals employ a variety of sophisticated techniques to launder money, taking advantage of loopholes in financial regulations and the complexity of the global financial system.Understanding these methods is crucial for developing effective countermeasures.

Traditional Money Laundering Techniques

Traditional money laundering techniques include:

Cash Smuggling: Physically transporting large amounts of cash across borders.
Structuring: Breaking up large transactions into smaller ones to avoid triggering reporting requirements.
Using Shell Companies: Creating companies with no legitimate business purpose to conceal the true ownership of assets.
Real Estate Purchases: Investing illicit funds in real estate to disguise their origin.
Trade-Based Money Laundering: Using international trade transactions to move illicit funds across borders.

Emerging Money Laundering Techniques

With the rise of new technologies, criminals are increasingly using sophisticated methods to launder money:

Virtual Currencies: Using cryptocurrencies like Bitcoin to anonymize transactions and move funds across borders quickly.
Online Gaming: Using online gaming platforms to launder money through virtual casinos and in-game transactions.
E-commerce Platforms: Exploiting e-commerce platforms to launder money through fraudulent transactions.
Romance Scams: Using online relationships to trick victims into sending money, which is then laundered.

The Role of Financial Institutions

Financial institutions play a critical role in combating money laundering and illicit financial flows.They are on the front lines of detecting and reporting suspicious activity, and they are required to comply with a range of anti-money laundering (AML) regulations.

Know Your Customer (KYC) Requirements

Know Your Customer (KYC) requirements are a cornerstone of AML compliance. $3.1T. Illicit funds that flowed through the global financial system in 2025. Nasdaq Verafin 2025 Global Financial Crime ReportKYC regulations require financial institutions to verify the identity of their customers and to understand the nature of their business.This helps to prevent criminals from using financial institutions to launder money.

KYC compliance involves collecting and verifying information such as:

Customer name
Address
Date of birth
Occupation
Source of funds

Suspicious Activity Reporting (SAR)

Financial institutions are required to file Suspicious Activity Reports (SARs) with law enforcement when they detect transactions or activities that may be related to money laundering or other financial crimes.SARs provide valuable information to law enforcement, helping them to investigate and prosecute financial crimes.

Examples of suspicious activity that should be reported include:

Large cash deposits or withdrawals
Unusual wire transfers
Transactions involving shell companies
Activities that are inconsistent with a customer's known business or financial profile

Combating Illicit Financial Flows: A Multi-faceted Approach

Addressing the problem of $3.1 trillion in illicit financial flows requires a comprehensive and coordinated approach involving governments, financial institutions, law enforcement, and international organizations.

Strengthening AML Regulations

Governments need to strengthen AML regulations to close loopholes and to ensure that financial institutions are adequately equipped to detect and prevent money laundering. The 2025 Global Financial Crime Report found that more than $3.1 trillion in illicit funds flowed through the global financial system last year alone. This includes nearly $800 billion in drugThis includes:

Increasing transparency in corporate ownership
Enhancing due diligence requirements for financial institutions
Strengthening cross-border cooperation between law enforcement agencies
Implementing stricter penalties for money laundering offenses

Enhancing Technology and Data Analytics

Financial institutions need to invest in technology and data analytics to improve their ability to detect and prevent money laundering. According to Nasdaq, In 2025, an estimated $3.1T in illicit funds flowed through the global financial system. Businesses these days have to put financialThis includes:

Using artificial intelligence (AI) and machine learning (ML) to identify suspicious patterns and anomalies
Implementing real-time transaction monitoring systems
Utilizing advanced data analytics to identify high-risk customers and transactions

Promoting International Cooperation

Money laundering is a global problem that requires international cooperation. In 2025, an estimated $3.1T in illicit funds flowed through the global financial system. Fueling trillions of dollars in money laundering activity were a range of destructive crimes, including anGovernments and international organizations need to work together to share information, coordinate investigations, and to implement consistent AML standards. The key takeaway for numerous crypto entrepreneurs and investors on X was no mention of Bitcoin, crypto or stablecoins in the Nasdaq report on financial crimes. $3.1T in illicit funds flowed through global financial system in 2025 - Emporio NFTThis includes:

Strengthening cooperation between financial intelligence units (FIUs)
Sharing information on suspicious transactions and criminal activities
Coordinating efforts to combat money laundering and terrorist financing

The Role of Cryptocurrency: Addressing Misconceptions

While the Nasdaq report didn't highlight crypto or stablecoins, it's important to address the common misconception that cryptocurrencies are the primary vehicle for illicit financial flows.While cryptocurrencies can be used for illicit purposes, studies have shown that the vast majority of money laundering still occurs through traditional financial channels. In 2025, more than an estimated $3.1 trillion in illicit funds flowed through the global financial system. Among the most prevalent crimes that fueled trillions of dollars in illicit flows and money laundering activity were a range of destructive crimes, including an estimated:Many in the crypto community emphasized this point when the report was released.

However, it is essential to acknowledge that cryptocurrencies do pose unique challenges for AML compliance. In 2025, it was estimated by Nasdaq that approximately $3.1 trillion of illicit funds were circulated through the global financial system $3.1T in illicit funds flowed through globalThe anonymity and cross-border nature of cryptocurrency transactions make it difficult to track and trace illicit funds. $3.1T in illicit funds flowed through the global financial system in 2025. This is from Nasdaq's 2025 Global Financial Crime Report. No mention of Bitcoin, Ether, or any other digital asset.Financial institutions and regulators need to develop effective strategies for monitoring and regulating cryptocurrency transactions to prevent their use for money laundering.

Recommendations for Regulating Cryptocurrencies

Implementing KYC regulations for cryptocurrency exchanges and wallet providers
Developing tools for tracking and analyzing cryptocurrency transactions
Enhancing cooperation between law enforcement agencies to investigate cryptocurrency-related crimes

Practical Tips for Individuals and Businesses

While combating illicit financial flows is primarily the responsibility of governments and financial institutions, individuals and businesses can also play a role in preventing money laundering.

For Individuals:

Be cautious of unsolicited offers or requests for money, especially from strangers online.
Protect your personal information and avoid sharing it with untrusted sources.
Report any suspicious activity to law enforcement.
Be wary of romance scams.

For Businesses:

Implement robust KYC procedures to verify the identity of your customers.
Train your employees to recognize and report suspicious activity.
Monitor transactions for unusual patterns or anomalies.
Comply with all applicable AML regulations.

Frequently Asked Questions

What is money laundering?

Money laundering is the process of concealing the origins of illicit funds, making them appear legitimate.It is a critical enabler of criminal activity, allowing criminals to profit from their crimes without detection.

Why is money laundering a problem?

Money laundering fuels criminal enterprises, undermines the integrity of the financial system, and poses a threat to national security. The report highlighted that financial crime continues to be a multi-trillion-dollar problem. Nasdaq estimated that in 2025, around $3.1 trillion in illicit funds flowed through the global financial system. Through money laundering, the funds fueled crimes like human and drug trafficking and terrorist financing.It enables criminals to operate with impunity and to corrupt officials, further entrenching their power.

What are the consequences of money laundering?

The consequences of money laundering are far-reaching. Very Interesting Read re: Global Financial Crime - estimated $3.1T in illicit funds flowed through the global financial system. - Money laundering accounted for trillions of dollars funding aThey include increased crime, economic instability, and a loss of trust in the financial system.

How can I protect myself from being a victim of money laundering?

Be cautious of unsolicited offers or requests for money, protect your personal information, and report any suspicious activity to law enforcement.

Conclusion: The Urgent Need for Action

The staggering $3.1 trillion in illicit funds flowing through the global financial system in 2025 serves as a stark reminder of the scale and complexity of financial crime. BTCUSD Bitcoin $3.1T in illicit funds flowed through the global financial system in 2025 NasdaqIt also shows the pervasiveness of these crimes, which contribute to terrible criminal activities around the globe. Tether CEO Paolo Ardoino called on legacy financial institutions to do their part in combating financial crime.Addressing this challenge requires a concerted effort from governments, financial institutions, and individuals. An estimated US$3.1 trillion in illicit funds flowed through the global financial system in 2025, according to NASDAQ research 1. Money laundering accounted for trillions of dollars, funding a range of destructive crimes, including an estimated US$346.7 billion in human trafficking and US$782.9 billion in drug trafficking activity, as well asBy strengthening AML regulations, investing in technology, promoting international cooperation, and raising awareness, we can disrupt the flow of illicit funds and protect the integrity of the global financial system.The stakes are high, and the time to act is now. BTCUSD Bitcoin $3.1T in illicit funds flowed through the global financial system in 2025 Nasdaq crypto or stablecoins in the Nasdaq report on financial crimes became the key takeaway forIt’s essential to remember that the numbers are not just figures but represent real victims of crime.

Key Takeaways:

An estimated $3.1 trillion in illicit funds flowed through the global financial system in 2025.
Drug trafficking and human trafficking are major contributors to illicit financial flows.
Money laundering techniques are constantly evolving, requiring innovative countermeasures.
Financial institutions play a critical role in detecting and preventing money laundering.
Combating illicit financial flows requires a multi-faceted approach involving governments, financial institutions, and individuals.

Learn more about how you can help combat financial crime by visiting your local law enforcement's website and educating yourself on the latest scams and money laundering techniques. Transnational illicit activities, ranging from romance scams to human trafficking, generated over US$3 trillion in 2025, resulting in the destruction of victims' sense of security and, in some cases, their lives, according to a 2025 Global Financial Crime Report by Nasdaq.Your awareness and actions can make a difference.