Why Disrupting Illicit Financial Flows
is a U.S. National Security Imperative

I. The Hidden Threat Weakening America’s Security

Illicit financial flows (IFFs)—the movement of money tied to crime, corruption, and terrorism—now total more than $3 trillion globally each year. These funds are the lifeblood of criminal networks, terrorist organizations, drug cartels, and corrupt regimes. They don’t just drain developing economies; they directly undermine U.S. national security.

In Latin America and South Asia, IFFs are fueling fentanyl trafficking, financing extremist groups, and destabilizing fragile states. These networks are more agile and global than ever—using sophisticated laundering schemes, informal banking systems, and unregulated trade to move vast sums of money undetected.
If left unchecked, illicit finance will continue to fund violence, weaken democratic institutions, and make America less safe—at home and abroad.

2. Why It Matters to the United States

This is not just a foreign problem—it is a threat to the U.S. homeland, economy, and credibility:

• The Drug Epidemic Starts with Dollars: Mexico’s drug cartels, fueled by illicit money, earn over $50 billion a year, much of it connected to synthetic drugs like fentanyl. This money flows through networks that reach American banks, businesses, and consumers.
• Terrorists Exploit Financial Blind Spots: In South Asia, underground money transfer systems like hawala quietly move funds for extremist groups. These networks often operate in parallel with legitimate commerce, making them hard to detect without serious investment in financial intelligence.
• Dirty Gold and Free Trade Loopholes: Criminal groups exploit unregulated gold markets in countries like Colombia and Panama, moving billions of dollars through free trade zones—bypassing controls and funding everything from arms purchases to political bribery.

The U.S. cannot fight cartels, terrorists, or strategic corruption without cutting off their cash flow. That requires targeting the money itself—not just the people moving it.

3. The Good News: We Know What Works

Targeting illicit finance isn’t just necessary—it’s effective. Sophisticated modeling and real-world experience show that the U.S. can get outsized results with focused investment:

• A $100 million investment in strategic interventions can disrupt over $5 billion in illicit flows. That’s a 50-to-1 return—far exceeding most military or law enforcement programs.
• In Colombia, targeting just 12 key individuals and companies in the gold smuggling network reduced the criminal network’s operations by over 70%.
• U.S. support for financial intelligence units and anti-money laundering programs has already helped seize billions in criminal assets, dismantle dozens of trafficking rings, and strengthen fragile institutions.

What these successes show is that when we prioritize the financial front, we win.