Armenia’s Complex Web of Financial Crimes: From Human Trafficking to Cyber Crimes and Embezzlement

In the rugged landscape of Armenia, where the Caucasus Mountains meet the Armenian Sea, lies a complex web of financial crimes impacting its people and the global stage.

Human Trafficking

Armenia serves as both a source and destination for human trafficking, with women and children, especially, at risk of sexual exploitation, forced labor, and begging.

Declining identification numbers since 2020, especially among women from within the country.
Ukraine, Belarus, Russia, India, and Iran are among the countries from which international victims are trafficked.
Mostly affected by forced labor and sex trafficking.
Domestic actors predominantly profit from human trafficking due to local demand.

Money Laundering

Money laundering is a significant challenge in Armenia, with proceeds from human trafficking, arms trafficking, counterfeit goods trade, and cybertimes often laundered through local banks and businesses.

No conclusive data on size or major players.
High-ranking officials, including doctors, police officers, and orphanage staff, are believed to be involved.

Arms Trafficking

Armenia’s arms trafficking market is limited but persistent due to ongoing conflicts in the Nagorno-Karabakh region.

Illegally obtained weapons from the region continue to circulate.
Allegations of Armenia being a destination for illegal armed imports from the Western Balkans fuel the illicit arms trade within the country.
Ties to Russia are also noteworthy, with arms reportedly exported during the conflict with Azerbaijan.

Counterfeit Goods Trade

Armenia serves as a transit country for the trade in counterfeit goods.

Most common counterfeit products found in the country are luxury items and brand-named goods.
Armenia is the third-largest supplier to Russia of cigarette smuggling.
The country’s share has been declining, giving way to Belarusian cigarettes.

Environmental Concerns

Environmental concerns include the exploitation of forests along the border with Azerbaijan.

Unregistered mining, logging, and poaching pose significant threats.
Armenia is a transit country for endangered animals on their way to Russia and the EU.
Corrupt officials are often complicit in the animal trade.

Gold and Diamond Mining

Despite reduced exploration, exploitation of gold and diamond mines within the country continues.

State-embedded actors abuse permits to exploit mines.
Diamond smuggling is equally prevalent, with diamonds processed in Armenia before being exported to UAE, Russia, and Belgium.

Cybercrimes

Cybercrimes are a growing concern, with government and military institutions frequently targeted by espionage attempts and Russian hacker groups.

The exact size and actors behind these cybercrimes remain unknown.
They carry political implications and can potentially impact the global stage.

Embezzlement, Tax Evasion, and Investment Fraud

Embezzlement, tax evasion, and investment fraud add another layer of complexity to the financial crime landscape in Armenia.

State-embedded actors, national actors, and foreign groups, including Israeli groups, have been implicated.
Though efforts to combat corruption have yielded some results, it’s clear that criminal activities reach deep into the fabric of the Armenian state and beyond.