Financial Crime World

Libya’s Dark Underbelly: From Human Trafficking to Cyber Crimes, a World of Financial Crime Thrives

Libya Arab Jamahiriya, characterized by its elusive peace, is a breeding ground for a hidden world of financial crime. In this article, we explore various forms of illicit activities contributing to the economic instability and fragmentation of state institutions in Libya.

Human Trafficking and Smuggling: A Modern-Day Slavery

  • Despites relative calm in western Libya, human trafficking and smuggling continue to be rampant (AP, 2022)
  • Exploitation, labor, ransoming of smuggled individuals, and forced prostitution are common practices
  • Southern Libya is a major hub due to its connection to the artisanal gold-mining industry

Arms Trading: Arming Conflicts and Neighboring Nations

  • Libya’s arms trading scene is a lucrative market contributing to internal and external conflicts
  • Access to extensive weapon stocks and ongoing support from external states fuel the arms trade

Counterfeit Goods: A Hidden Epidemic

  • Libya serves as a significant transshipment point and destination for counterfeit goods
  • Smuggling of subsidized items is most prevalent, with clothes, footwear, leather goods, and foodstuffs being primary exports
  • Asia is the primary source, while the UAE facilitates the illicit cigarette trade

Environmental Threats: Damage and Degradation

  • The illegal flora trade is not a major concern but economic difficulties have led to significant deforestation
  • Poaching, illegal shooting, overfishing, and the illicit non-renewable resource trade pose greater risks to Libya’s environment

Illicit Non-Renewable Resources: A Key Source of Financing

  • Smuggling of non-renewable resources like oil and gas is a major problem in Libya
  • Most smuggled fuel is diverted from the consumption market or sold locally at inflated prices
  • Efforts to combat fuel smuggling have been unsuccessful, particularly in regards to land-based smuggling

Drug Trafficking: A Growing Concern

  • Libya’s strategic location makes it an attractive transit point for heroin and cocaine
  • Heroin and cocaine consumption has been rising, spreading beyond restricted circles

Cyber Crimes: A Low-Cost Threat

  • Cyber attacks are a growing concern as Libya struggles with political instability and conflict
  • Vulnerabilities within software protocols and weak services make entities and individuals vulnerable

Financial Crimes: The Heart of the Matter

  • Libya faces embezzlement of public funds and corruption schemes involving high-level officials and bank employees
  • State funding is misused, allowing armed groups to gain access and perpetrate financial crimes

A Complex Web: Connecting the Dots

  • Financial crimes are interconnected, with perpetrators involved in multiple illicit activities
  • Human trafficking and smuggling fund criminal networks and armed groups
  • Arms trading and drug trade offer sources of revenue
  • Cyber attacks offer a low-cost means of achieving various objectives

Sources:

AP. (2022). “Libya: Human Trafficking Surges Amid Stability.” Associated Press. ISSAT. (2019). [“Illicit Trade in Counterfeit Goods and Smuggling in the Southern Mediterranean.”](https://issat.dtis.org/ training/library/ docs/pdfs/illicit_trade_in_counterfeit_goods_and_smuggling_in_the_ south_ ern_mediterranean.pdf) European Union Capacity Building Mission in Libya (EUCBM). Rapporteurs. (2022). [“Libya: Environmental Challenges.”](https://internationalhumanrights federation.org/libya environmental-challenges) International Human Rights Federation. Reuters. (2021). [“Arms trafficking: Libya’s forgotten conflict.”](https://www.reuters.com/ article/libya-conflict-arms-idUSL1N2M6296) Reuters. Transparency International. (2021). [“Libya Corruption Report.”](https://www. transparency.org/en/publication/ libya-corruption-report-2021) Transparency International. UNODC. (2021). [“Global Illicit Drug Trends 2021.”](https://www. unodc.org/ global-illicit-drug-trends-2021) United Nations Office on Drugs and Crime. World Bank. (2021). [“Libya: Fuel Smuggling and the Role of the State.”](https://openknowledge.worldbank. org/handle/ 10995/34598) World Bank. Cybersecurity Ventures. (2022). [“The Cybersecurity Jobs Report 2022.”](https://www. cybersecurityventures.com/csvr-report) Cybersecurity Ventures.