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Italian Republic !“You may have the Universe - If I May Have Italy” Giuseppe Verdi Section 1 - Executive Summary .............................................................. Page 3 Section 2 - Country Information ............................................................. Page 4 Section 3 - Country Ratings ................................................................... Page 5 Section 4 - FCN Country Ratings ............................................................ Page 7 Section 5 - Key Harms Summary ............................................................ Page 9 Section 6 - Key Threats Summary & Threats in More Detail ................. Page 10 Section 7 - Sanctions & Embargoes ...................................................... Page 31 Section 8 - Terrorism/Terrorism Finance ............................................... Page 33 Section 9 - Money Laundering ............................................................. Page 36 Section 10 - Response .......................................................................... Page 39 Section 11 - Detailed FATF Results ....................................................... Page 50 Section 12 - Remittance & Migration Data ........................................... Page 51 Appendix 1- Threat Types Risk Ratings ................................................ Page 52 Appendix 2 - Sources ........................................................................... Page 53 Endnotes .............................................................................................. Page 54 This Threat Assessment for Italy 2021 is produced and published by Financial Crime News and all rights are reserved including copy- right by Metriqa Limited. This TA should not be used for commercial purposes without obtaining rst a licence or express permission from the publisher. The Author and contributors are John Cusack, Ursula M’Crystal, Hannah Cusack & Sophie Giles. Additional thanks go to the many experts that have reviewed and provided comments including from both public and private sectors in Italy. Italy - Threat Assessment - 202 Page 2 of 57 1 fi
Section 1 - Executive Summary Grey Lists: Italy is listed by the US as a Country Index (2018): Incidence of 2.4 - 1000 people of Primary Concern in respect of ML & FC, but & government response of “BBB.” is not listed by FATF, or the EU on their “Grey” Sanctions & Terrorism: No Sanctions against lists. the country. Tier 1 (Higher Threat) PPI Index NRA: Italy’s NRA was published in 2018, & rating with a controls score of 884/1,300. Sig- identi ed criminal activities considered partic- ni cant trade with Iran. Italy is ranked 59/138, ularly generative of illicit proceeds, being cor- and rated “low” at 3.043/10 in the Global Ter- ruption, extortion, tax evasion & tax offences, rorism Index 2020. usury, drug traf cking, bankruptcy & corporate Tax Evasion: Tax Evasion in Italy is estimated offences. Those of lesser severity were identi- at €86.4 billion a year (2016). ed as gambling, smuggling & counterfeiting, sexual exploitation & illegal waste traf cking. Response & Resilience: Italy’s MER was pub- lished in 2016, with a 2019 Follow up report. Corruption: TI CPI - 2020 - ranked 53/179 with Based on a simple scoring model developed an overall score of 52 out of 100, below the by FCN, Italy is rated highly at 80% for techni- Western European and EU average. cal compliance, & 58% for effectiveness. Taking Organised Crime: According to the NRA, or- key areas only, scores are 73% and 50% re- ganised crime remains the most dominant of spectively. Italy is one of the most successful criminal behaviours, with Ma a groups posing countries in seizing and con scating assets, a threat unparalleled by any other EU OCG. with at least €9 billion or 7.3% of estimated criminal proceeds in 2018. Italy is a member Drug Traf cking: Italy has an estimated The Europol Financial Intelligence Public Pri- 554,099 people with illegal drug use disorders vate Partnership (EFIPPP). (2017), representing 1.15% of the population. Overall Ratings: Italy is rated overall “Moder- Fraud: The most prevalent frauds include ate” Risk, scoring 58/100 for nancial crime fraudulent cross border currency transfers, and money laundering by FCN. The trend is fraud by internal and external parties, forgery, currently rated as “Neutral”. Threats are rated cybercrime, credit card fraud, ATM skimming, “Moderate - High” at 35/100 & Responses identity hacking account, false invoicing and “High” at 81/100. asset misappropriation, being the most com- mon type of economic crime in 2016. Human Traf cking: US Traf cking in Persons: FCN Rating: “Moderate” Risk 58/100 - Tier 2 country (2019 & 2020); Global Slavery trend “Neutral” Italy - Threat Assessment - 202 Page 3 of 57 fi fi fi fi fi fi fi fi fi fi fi 1
Section 2 - Country Information - People & Geography: Italy’s rst societies ing; food, beverages, tobacco come from emerged around 1200 BC with its capital Germany 16.3%, France 8.8%, China 7.1%, Rome, founded in 753 BC. Despite an even Netherlands 5.6%, Spain 5.3% & Belgium 4.5% population distribution throughout the coun- (2017). try, Rome and other urban areas, such as Milan and Naples, attract denser populations. The Crime: While Italy is on the lower end in the country also boasts a diverse terrain, featuring 2019 World’s Safest Countries list (40/128 -1 mountains in the North and coastal lands and being best)3, as an advanced economy, signi - volcanoes in the South, appealing to tourists cant criminal proceeds are nevertheless gen- from all over the world. Religion is important in erated. Ma a-type Italian organised crime is Italian society, evident in the fact that 83.3% of considered to be a signi cant threat to Italy & its 62 million population are christian, over- the European Union (EU). The Italian Ma a whelmingly roman catholic. Italy counts mi- succeeds through its control and exploitation grants as representing 10.6% of the total pop- of territory & of the community. According to ulation (6.4 million) for 2020 an increase from reports4, “Ma a groups have in ltrated almost 3.7% from 20001. every area of business, including healthcare, renewable energy, waste management and Recent History & Leadership: Italy has been tourism, while maintaining a hand in their more at the forefront of European economic and po- traditional construction sector. Gangs have also litical uni cation, joining the European Com- penetrated the food chain, seizing control of munity in 1957, and the euro-zone currency farms, controlling distribution and counterfeit- union in 1999. The 1990s, however, saw Italian ing food products, including cheese, wine and politicians, businessmen and prime ministers olive oil. Their growth beyond Italy also remains implicated in high levels of corruption within strong, especially in Europe and South Ameri- Italy’s political landscape. Italy’s prime minister, ca.” Mario Draghi, formed a government in Feb- ruary 2021. Finance: Italy is an important regional and in- ternational nancial centre, and is among the Economy & Trade: Italy2 is the 3rd largest IMF’s 29 systematically important nancial cen- economy in the euro zone with a GDP of US$2 tres5. The Italian nancial system is largely bank trillion (2020 est). The Italian economy is dom- dominated, but insurance and other interme- inated by services at 73,9%, followed by Indus- diaries play a meaningful role and have been try at 23.9% and Agriculture at 2.1%. Exports recently growing.6 Based on assets, Italy has 2 (US$496 billion) of engineering products, Banks in to worlds top 200, with Bank Intesa textiles and clothing, production machinery, Sanpaulo at 27/100, and Unicredit at 34/100. motor vehicles, transport equipment, chemi- In Italy, 94% of people (over 15) have bank ac- cals; foodstuffs, beverages, and tobacco; min- counts, 42% have a credit card, with internet erals, nonferrous metals go to Germany 12.5%, users making payments online at 65%7. Remit- France 10.3%, US 9%, Spain 5.2%, UK 5.2% & tances inbound in 2017 were approx US$9,480 Switzerland 4.6% (2017). Imports (US$433 bil- million (0.5% of GDP) according to the World lion) of engineering products, chemicals, Bank8. See Section 11 below for more details. transport equipment, energy products, miner- als and nonferrous metals, textiles and cloth- Italy - Threat Assessment - 202 Page 4 of 57 fi fi fi fi fi fi fi fi fi fi f 1
Section 3 - Country Ratings - Information from leading sources produce 40 plus ratings for Italy, covering both threats and re- sponses in ghting nancial crime, sanctions, proliferation nance, terrorism & terrorism nance. No. Threats Italy ! No Responses Italy 1 GDP - Economic Size * 8th largest economy in the world 1 OECD - Global Forum * Compliant GDP per Capita US$2,002,763,000,000 (2019 est - 2.35% Global on Transparency & Exchange Info for Tax Purposes GDP) US$33,328 GDP per Capita (2019) 2 World Economic Forum * 77.0 (2019) (63/141) 2 Global Slavery Index * BBB Security (OC, Terrorism, Homicides, 63/141 (45.1/99.3/99.3/64.1) Country Response Rating (ratings from AAA, AA, A, BBB) Policing) 3 World Economic Forum * 45.1 3 US Dept of State * Tier 2 Organised Crime (117/141) Traf cking in Persons Medium Rated 4 Numbeo Crime Survey 2020 44.26/100 4 Proliferation Index - PPI * 884/ 1300 62/129 (1 being the worst) Controls Moderate Controls score 5 US Institute for Health Metrics and 554,099 (2017 -18.75% since 1990j 5 International Telecommunication Union 0.837/10 Evaluation - 2018 1.15% (2017 - 8% since 1990) Global Cybersecurity Index 2018 (25/176) Illegal Drug Dependency / Disorders * Number/Share 6 Transparency International (TI) Corruption 52/100 6 World Bank Regulatory Quality * 0.95 - 2019 Perceptions Index* (53/179 - 2020) from WB Global Governance Indicators 43/193 (1 being the best) 7 TRACE 31/100 7 TI - Exporting Corruption * Green Rated Bribery Risk Matrix Ranked 36th out of 194 Enforcement of the OECD Anti-Bribery “Active Enforcement” Convention 8 Proliferation Index - PPI Tier 1 8 Freedom House * 90/100 Threat * Highest Threat Level Freedom Index “free” 9 US Dept of State Included in Volume II 9 Heritage Foundation 64.9/100 INCSR Vol I & Vol II * Economic Freedom Index “Moderately Free” 68 out of 178 10 US Dept of State Included 10 Basel AML Index * 4.61/10 Country Reports on Terrorism * 2020 99/141 (1 being the worst) 11 Global Slavery Index 2.4/1,000 11 FIU Egmont Member Interpol / Europol Yes GSI Incidence * Incidence of human traf cking Member (34/50 Countries in Europe) 12 Global Slavery Index 145,000 12 Asset Con scations * Estimated above 1% No of estimated Modern Day Slaves Estimated numbers of modern day slaves over 1% of Proceeds (asset seizures/con scations of at least €9 billion with an estimate of 7.3% in 2018) 13 US Dept of Labor Not included 13 Country National Risk Assessment * Yes Child Labour 2018 14 Global Terrorism Index * 3.043 14 Financial Information Sharing Partnership As part of EFIPP - The Europol Financial Intelligence GTI - Impact “Low” Impact Public Private Partnership 15 IOM Migration 6.4 million migrants 15 Environment Performance Index 71 (10.6% in 2020) 2020 (20/180) 16 Illegal Unreported and Unregulated (IUU) 2.5/5 16 Government Spending on Law & Order * 1.6% of 2018 GDP - IUU Fishing Index * 35/152 Eurostat 2018 17 EU Listing of Countries for Illegal Fishing No 17 Know Your Country 72.41/100 Country Money Laundering Index 97th/245 (1 being the best) 18 US DoS - Wildlife Traf cking * Not Included 18 European Union * N/A Focus / Countries of Concern Third Country Grey List EU Countries are not eligible for this list 19 EUIPO & OECD Counterfeit Goods * 0.152% 19 FATF Standards 80% Propensity of Exports 2016 40 Recommendations* 20 UNODC Thefts Not Included in UNODC Data 20 FATF Standards 58% Per 100,000 people Italian data - 820,000 thefts (2019-2020) 11 IO"s on Effectiveness* (1,322 per 100,000 people) 21 EU List of None Co operative Jurisdictions NA 21 FATF Standards 73% for Tax purposes Core 10 Recommendations 22 Global Financial Integrity Italy is an Advanced Economy 22 FATF Standards 50% Illicit Financial Flows* Core 4 IO"s on Effectiveness 23 Fund For Peace 42.40/120 23 FATF * Counter - Measures No Fragile States Index (36/176) Strategic De ciencies List * Indicates the information is included in the FCN Country Index Italy - Threat Assessment - 202 Page 5 of 57 fi fi fi fi fi fi fi fi fi 1 fi
Section 3 Continued - Threats & Responses Rating Scorecard The Country Dashboard RAG ratings are established based on the FCN Threats and Responses Rat- ing Scorecard - 2021, set out below. Threats Responses No Higher Moderate Lower No Lower Moderate Higher 1 >US0.5 trillion >US$100 billion - 0.5 trillion 60 >40 - 60 426 Controls / 1,300 T2 426-650 Controls /1,300 T2 >650 Controls /1,300 T1 Country 975/1,300 5 >1% >0.75% - 1% 0.66 6 55 38 - 55 7 6-7 5% >2% - 5% 1 million >50,000 - 1 million 5% of est criminal proceeds proceeds 13 >10% child labour (4-15 >5% - 10% child labour (4-15 3 Years Old Yes 4 -10 >2 -4/10 0-2/10 14 No N/A Yes 15 >US0.5 trillion >US$100 billion - 0.5 trillion 2.4 2 - 2.4 1.5% - 2% of GDP over 2% of GDP 17 Yes Red Card Yes Yellow Card No 17 70 18 Focus Countries N/A Not Included 18 Included N/A Not Included 19 >0.3 >0.2 - 0.3 1,500 >783 - 1,500 80 - 120 >60 - 80
Section 4 - Financial Crime News (FCN) Country Ratings - From all the available information collected and results summarised in Section 3 above, 26 ratings have been selected, covering a broad base of threats and responses in ghting nancial crime, proliferation nance and terrorism & terrorism nance. The results make up the FCN Country Threat / Response & Overall Risk scores for Italy. FCN Final Ratings - Republic of Italy ! Financial Crime News 35/100 Financial Crime News “Moderate” Risk - 58/100 Threat Rating “Moderate - High” Threat Overall Financial Crime Rating Financial Crime News 81/100 Trend Neutral Response Rating “High” Response Italy - Threat Assessment - 202 Page 7 of 57 fi fi 1 fi fi
Italy - Threat Assessment - 202 Page 8 of 57 1
Section 5 - Key Harms Summary - The harms that result from the realised threats • Murder rates were at 555 between faced by Italy from crime, ML, proliferation - August 2011 - July 2012 and 278 nance and terrorism remain substantial, and for August 2019 - July 2020. warrant a substantive continued response. • Ma a killings in the rst half of 2016 These harms (see Section 6 for details) include: were 34, with 28 carried out by the Campa- • 4% of those surveyed in Italy stated that they nia’n ma a, the Camorra. had witnessed a case of corruption in the last • 1 in 5 organisations (21%) claimed to have 12 months & 41% were personally affected been a victim of economic & nancial frauds. by corruption in their daily lives. • Italy has an estimated 554,099 people with • Theft rates went from 1.5 million between illegal drug use disorders (2017), represent- August 2011 and July 2012 to 820,000 be- ing 1.15% of the population. tween August 2019 and July 2020. • In young adults (15-34), penetration rates for • Robberies also decreased dropping to drugs were cannabis at 20.9%, MDMA at around 20,000 between August 2019 and 0.8% and cocaine at 1.7%, with an estimated July 2020. The numbers peaked at 44,000 number of high risk heroin users of approxi- between 2012 and 2013. mately 235,000 in 2015. • According to the UNODC, the robbery rate • Italy has a low incidence of human traf cking, for 2017 was 51 per 100,000 people, with with 2.4 in 1,000, but still this gives an esti- Italy ranked 29/97 countries, and mate of approximately 145,000 victims, • Kidnap rates were 0.3 per 100,000 people, & ranking Italy 34 in Europe and Central Asia ranked 37/79 countries (1 being the highest). out of 50 countries assessed. • Car thefts are highest in Apulia, which • The amount estimated for tax evasion was recorded the highest car theft rate in Italy, €86.4 billion, being the average annual val- with about 697 cases every 100,000 popula- ue for the period 2011-16. Of this gure, the tion, followed by Catania. estimate for tax evasion due to non-payment of taxes, and errors in completing tax returns, • The drug-induced mortality rate among is €13.2 billion which is many times larger adults (aged 15-64 years) is 7.8 deaths per than the amount the Italian Government million which is lower than the European av- spends (€4.8 billion or 0.252% of GDP - erage of 20.3 deaths per million. 2017) on the entire Italian Justice system (2017). Italy - Threat Assessment - 202 Page 9 of 57 fi fi fi fi fi fi f 1
Section 6 - Key Threats Summary - In this Section 6, the most important criminal Based on estimates from the GTA 2019, Italian threats identi ed based on the best available estimates for other major criminal activities in- sources are summarised. clude human traf cking, theft & stolen goods & green crimes. Based on gures from the GTA12, The National Risk Assessment (NRA), pub- estimates for theft are up to around 5% of lished in 20189, concluded that “The major criminal proceeds, green crimes up to 4%, and criminal behaviours, not only for their nancial human traf cking/modern slavery (HT/MS) up impact but also for their wider consequences, to 3%. These would generate proceeds from are corruption, extortion, tax evasion and theft at up to €6.4 billion, green crimes at up tax offences, usury, drug traf cking, bank- to €5 billion and HT/MS at up to €3.8 billion. ruptcy and corporate offences”. Other crimes having a lesser degree of severity were identi ed as gambling, smuggling and coun- terfeiting, sexual exploitation and illegal waste traf cking. Based on sources included in this Italy Threat Assessment, total proceeds are estimated at 6.7% of GDP (mid-point between 1.7% & 12% - see NRA 201810) amounting to €127.3 billion. This is similar to estimates given in the FCN Global Threat Assessment11 (GTA) for Italy, which estimated overall proceeds of US$136 billion (€112 billion) for 2018. The largest amounts estimated for criminal ac- tivities are for: Estimated funds available for laundering are €97 billion (See 9.3 below) and from trade • Tax Evasion at €86.4 billion (€13 billion based money laundering €14.3 billion, (See for personal tax evasion) 9.4 below). Organised crime (OC) plays a very • Corruption at €19 billion signi cant role in Italy, with some estimates (2010 - 2102/1313) ranging from €26 billion - • Drug Traf cking at €15 billion €138 billion. • Others at €7 billion Italy - Threat Assessment - 202 Page 10 of 57 fi fi fi fi fi fi fi fi fi fi 1
Section 6 Continued - Key Threats in More Detail - In this Section 6, the most important criminal The threat of money laundering is considered markets, are assessed and summarised. to be “Very Signi cant”, while the risk of terror- ist nancing is deemed “Rather Signi cant”. 6.1 National Risk Assessment (NRA): The NRA published in 201814 is the second NRA, 6.2 US INCSR: Italy is identi ed as a Major following the rst NRA in 201415 concluded Money Laundering Country (country of prima- that “The major criminal behaviours, not only ry concern) in the 2020 INCSR16. The country for their nancial impact but also for their wider has been included for the last 5 years. consequences, are corruption, extortion, tax evasion and tax offences, usury, drug traf ck- ing, bankruptcy and corporate offences”. Oth- er crimes having a lesser degree of severity were identi ed as gambling, smuggling and counterfeiting, sexual exploitation and illegal The report stated that “In response to the con- waste traf cking. tinuing challenges of money laundering, the Italian government enacted a decree law on Threat NRA 2014 NRA 2018 October 3, 2019 seeking to clarify virtual cur- Bankruptcy & Corporate Very Signi cant Very Signi cant O ences rency treatment under AML statutes, further Corruption Very Signi cant Very Signi cant empower law enforcement authorities investi- Drug Tra cking Very Signi cant Very Signi cant gating money laundering, and impose addi- Extortion Very Signi cant Very Signi cant Gambling Very Signi cant Very Signi cant tional CDD obligations on nancial intermedi- Illegal Waste Tra cking Very Signi cant Very Signi cant aries. Financial penalties assessed by Italian nancial sector supervisors against legal and Organised Crime Very Signi cant Very Signi cant Sexual Exploitation Very Signi cant Very Signi cant Smuggling & Counterfeit- Very Signi cant Very Signi cant natural persons for AML breaches have been ing increased to be more dissuasive”. Tax Evasion / Tax Of- Very Signi cant Very Signi cant fences Usury Very Signi cant Very Signi cant Volume II of the 2020 INCSR17 provided the Money Laundering Very Signi cant Very Signi cant overview: “Italy"s economy is the ninth largest Terrorism Finance Rather Signi cant Rather Signi cant in the world and the third-largest in the Euro- zone. Italy has a sophisticated AML regime and The NRA assesses the inherent risk in the coun- legal framework, but a continued risk of money try using 4 risk categories: “Non-Signi cant”, laundering stems from activities of organised “Lowly Signi cant”, “Rather Signi cant” and crime and the large, black market economy. “Very Signi cant”. According to the Italian National Statistics Insti- tute, the black market economy accounts for Italy - Threat Assessment - 202 Page 11 of 57 fi ff fi ffi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi ffi fi fi fi fi fi fi fi fi fi fi fi fi fi 1
12.1% of GDP, or approximately US$235 bil- of 100, falling below the average regional lion (€211 billion). Tax crimes also represent a score of 66/100 for Western Europe and Eu- signi cant risk and have been identi ed as ac- ropean Union. counting for 75% of all proceeds-generating crime in Italy”. “While on the rise, CDD and suspicious trans- action reporting remain weak among non- - nancial sectors, and regulations are inconsis- tent. In early 2019 the government published Italy has improved its score since 2012 and Regulation n. 44 to implement new provisions shown “concrete improvements” by demon- on AML/CFT organisation, procedures, internal strating legislative progress with the “passage controls, and CDD. The new regulations align of anti-corruption laws and the creation of an with EU efforts and require online entities to anti-corruption agency”. adopt controls and procedures”. Political corruption remains a major problem 6.3 Security: According to The World Eco- particularly in Lombardy, Campania and Sicily nomic Forum’s Global Competitiveness Index where corruption perception is at a high lev- 201918, under Pillar 1 Institutions, Italy’s rating el21. Political parties are ranked the most cor- for “Security” is 77.0/100 ranked 63 out of 141. rupt institutions in Italy, closely followed by public of cials and Parliament, according to Transparency International's Global Corruption Barometer in 2013, where 89% of surveyed households considered political parties to be corrupt or extremely corrupt, and that 64% of the surveyed households believe that the level This overall score is made up of scores for or- of corruption has increased, and 61% of sur- ganised crime at 45.1 (ranked 117/141), homi- veyed households nd government efforts in cide at 99.3 (rate of 0.7/100,000 people) and the ght against corruption to be ineffective22. ranked 20/141, terrorism incidence rate 99.3/100 (ranked 86/141) & police service reli- The 2020 TRACE Bribery Risk Matrix23 rates ability at 64.1/100 and ranked 51/141 (in all Italy at a “low” risk level, ranking it 36 out of cases higher scores are better). 194 surveyed countries, with an overall risk score of 31. The TRACE Matrix equates Italy 6.4 Corruption: The NRA 201819 reports cor- along with countries such as Poland, Spain, ruption as a “very signi cant” threat in Italy. Ac- and Kosovo as a “Democracy with complex cording to Transparency International’s, (“TI”) economy”, which “generally consists of stable, Corruption Perceptions Index 202020, Italy was ranked 53/179, with an overall score of 52 out Italy - Threat Assessment - 202 Page 12 of 57 fi fi fi fi fi fi f 1
democratic states with complex, diverse payments and gifts are subject to strict limita- economies and fair to weak civil societies”. tions”. It also states that, “The Italian police force poses a moderate corruption risk. Com- According to a 2018 report which mapped the panies report moderate con dence in the reli- risk of Serious and Organised Crime in ltration ability of the police forces”. Furthermore, “one- in European Businesses (OC in EU Report)24, third of surveyed citizens believe that bribery “the strong presence of OC, the frequent use of and abuse of power are common among po- cash (especially in some regions), the large ir- lice of cials” and that “authorities have estab- regular economy and public interventions are lished effective mechanisms to investigate ab- acknowledged by scholars and policy-makers use and corruption among police forces, yet as the most important way to generate a per- long delays by courts and prosecutors impede fect environment for corruption to grow”. investigations”. It would appear that despite the establishment A 2017 EU Survey26 found that: of agencies and other actions, that systemic and organised corruption has not been signi- • 4% (EU28 - 5% / IT - 4%) of those surveyed in cantly mitigated. Corrupt collaboration has Italy stated that they had witnessed a case of been identi ed particularly in the public pro- corruption in the last 12 months; curement domain, most notably public works, • 41% (EU28 25% / IT - 41%) were personally waste management, local transport, health affected by corruption in their daily lives; care and social care. • Giving or taking bribes was believed to be The GAN Integrity Business Anti-Corruption most widespread in the following areas: Portal (2017)25 provides the view that “There is a high risk of corruption for businesses operat- • Political Parties (Italy - 66%, EU28- 56%,) ing in Italy. Public procurement, in particular, • PEPs (Italy - 60%, EU28 - 53%) presents a high risk of corruption, as it involves large resources and exposes companies to or- • Police & Customs (Italy - 31%, EU - 31%) ganised crime. The integrity of public of cials is • Banks & FIs (Italy - 42%, EU - 33%) marred by their relationships with organised crime and businesses. Extortion, act- According to an EU report27 in 2014, it was es- ive and passive bribery, bribing a foreign pub- timated that corruption costs Europe €120 bil- lic of cial, fraud, and money laundering are lion (US$162 billion), or 1% of the EU’s GDP. criminalised under the Criminal Code of the Translated into Italy, this would represent ap- Italian Republic. Anti-corruption laws are gen- proximately €19 billion. erally implemented effectively, but of cials 6.5 Organised Crime: The NRA, states that sometimes engage in corrupt practices with “Organised crime remains the dominant and impunity. There is no exception for facilitation most worrying perpetrators of criminal beha- Italy - Threat Assessment - 202 Page 13 of 57 fi fi fi fi fi fi fi fi 1
viours, which however, does not exclude the Ports considered most likely used by the Ma a signi cant role of foreign criminal organisa- for transporting contraband are in Ancona (in tions operating in the country. With the exclu- Marche, on the Adriatic coast), Cagliari (in sion of tax evasion, almost the entirety of Sardegna, on the Tyrrhenian coast), Genova (in crimes carried out are for the most part and, in Liguria, on the Ligurian coast) and Gioia Tauro some cases, exclusively attributable to organ- (in Calabria, on the Tyrrhenian coast). In addi- ised - including ma a-style - crime (e.g., drug tion Ma a activities have also been reported in traf cking, extortion, gambling, illegal waste Salerno (in Campania, on the Tyrrhenian coast), traf cking, smuggling and counterfeiting), with in Taranto (in Puglia, on the Adriatic coast), in particularly dangerous effects due to the integ- Livorno (in Toscana, on the Tyrrhenian coast), in ration process and overlapping between or- Napoli (in Campania, on the Tyrrhenian coast), ganised crime and economic crime”. For more Olbia (in Sardegna, on the Tyrrhenian coast) details on speci c crimes see later in this Sec- and in Trieste (in Friuli Venezia Giulia, on the tion 6. Adriatic coast)29. The NRA summarises the size of organised According to OC in EU Report30, a change in crime in Italy, including estimating a number of strategy by organised crime groups has sources which between 2010 - 2012/13 range emerged in relation to white-collar crimes from €26 billion - €138 billion. where the country’s vulnerabilities related to the following risk factors are exploited: Interpol Italy28 states that “Italy is located at the heart of Europe, surrounded by the Mediter- • The cash-intensity of the economy (espe- ranean Sea and sharing open land borders with cially in some geographic areas); four other European Union countries. This • High levels of tax crimes – including smaller geographic location makes Italy attractive to scale tax evasion, larger scale scal fraud, local, regional and global organised crime and false invoicing schemes; groups. Ma a-type criminal organisations in Italy operate behind the façade of legitimate • The large underground economy and business, making them increasingly dif cult to prevalence of irregular labour practices; detect. Their primary areas of activity include • Systemic levels of corruption (especially in international drug and arms traf cking, traf ck- the public procurement sector); and ing in human beings, people smuggling, money laundering and cybercrime. Italy con- • Anomalies related to business ownership centrates considerable law enforcement re- opacity in some industries and speci c re- sources on monitoring the growing threat to gions. national security of global terrorism”. Italy - Threat Assessment - 202 Page 14 of 57 fi fi fi fi fi fi fi fi fi fi fi fi fi 1
Section 6 Continued - Organised Crime Summary Italy - Threat Assessment - 202 Page 15 of 57 1
In a 2013 Europol Threat Assessment of Italian “Ma a groups have in ltrated almost every Organised Crime (Europol OC Report)31, it area of business, including healthcare, renew- states that, “Ma a-type Italian organised crime able energy, waste management and tourism, is a clear and present threat to the European while maintaining a hand in their more tradi- Union (EU). The basis of the power of the Italian tional construction sector. Gangs have also Ma as resides in their control and exploitation penetrated the food chain, seizing control of of the territory and of the community. The con- farms, controlling distribution and counterfeit- textualised concepts of family, power, respect ing food products, including cheese, wine and and territory are fundamental to understanding olive oil. Their growth beyond Italy also remains the dynamics of the Ma as. The Ma as are ca- strong, especially in Europe and South Ameri- pable of manipulating elections and installing ca.” their men in administrative positions even far OCGs were becoming increasingly sophisti- away from the territories they control. From that cated, in ltrating important economic sec- perspective, the threat they pose is unparal- tors to facilitate laundering leled by any other European Organised Crime Italy Interior Minister - 2019 Group (OCG). Exploiting legislative loopholes The 2020 OSAC33 Italy report advises that “Or- and using the services of corrupt administrators ganised criminal groups such as the Camorra, and professionals, they launder money and $Ndrangheta, Cosa Nostra Sacra Corona Unita, manage it through front companies and straw and non-Italian organised criminal groups are men.” active throughout all of Italy. Italy also has some Ndrangheta has €44 Billion year income, active organised crime elements from the fol- 62% deriving from drug traf cking alone lowing locations: Italian Organised Crime Threat Assessment 2013 • Southeast Europe (Macedonia, Albania, In a recent media article32, the interior minister and Kosovo): cocaine traf cking, launder- of Italy raised concerns that organised crime ing money, migrant traf cking, extortion, groups had used a variety mechanisms to ad- and property crimes; apt while using!#increasingly complex” models of criminal activity. Criminal organisations were • Russia and Eastern Europe (Romania, Bul- becoming increasingly sophisticated, in ltrat- garia): money laundering, break-ins, and ing important economic sectors to facilitate the thefts; laundering of their ill-gotten gains. In 2013, a • China: extortion, migrant traf cking, study by the Demoskopia Research Institute blackmail, credit cards, drugs, arms, pros- “claimed the "Ndrangheta made more money titution, and illegal gambling; and than Deutsche Bank and McDonald"s put to- gether, with a turnover of €53 billion (£44 bil- • West and North Africa: false documents, lion)”. cocaine traf cking, and fraud. Italy - Threat Assessment - 202 Page 16 of 57 fi fi fi fi fi fi fi fi fi fi fi fi fi 1
6.6 Drug Traf cking: Volume II of the 2020 Asia and north-western and south-eastern Eu- INCSR34 reports that “Drug traf cking is a pri- rope. The maritime route of illicit drug traf ck- mary source of income for Italy"s organised ing is of primary importance for all substances, crime groups, which exploit Italy"s strategic ge- although drugs are also smuggled into Italy by ographic location to do business with foreign air and by land from neighbouring countries. criminal organisations in Eastern Europe, Chi- Cocaine traf ckers operating in Italy are sup- na, South America, and Africa.” plied mostly by the Colombian market. Heroin Italy has an estimated 554,099 people35 with from Afghanistan reaches Italy mainly via the illegal drug use disorders (2017), representing Balkan route (the southern branch, mostly by 1.15% of the population. sea (ferries), and the central branch, by land). Criminal groups organise cannabis resin ship- According to the NRA in 2018, drug traf cking ments (mostly of Moroccan origin) from Spain is considered “Very Signi cant” and it is be- to Italy either directly or via other European lieved that the estimate of drug traf cking pro- countries; alternative high-quantity maritime ceeds in 2017 was €15.2 billion, reporting an routes from Libya, Egypt and Turkey have de- increase in the number of people involved in veloped in recent years. Herbal cannabis ar- this illegal market, and that virtual assets have rives by land and sea routes that start in Alba- been identi ed in the purchase of drugs. nia. A large proportion of illicit drugs pass €15.2 billion in drug traf cking proceeds through Italy en route to other EU countries. NRA 2018 Domestic cannabis cultivation is reported, pre- dominantly in southern Italy. New psychoactive According to the European Monitoring Centre substances (NPS) are usually purchased online for Drugs and Drug Addiction (2019)36, Italy “is and are shipped to the country via postal ser- one of the main drug gateways to Europe ow- vices. ing to its geographical position at the centre of the Mediterranean Sea & its long coastline. The Cannabis products are the most seized drugs presence of ma a-type organised crime in Italy, followed by cocaine and heroin. Other groups makes Italy a key destination country for substances (mainly synthetic drugs) are seized bulk quantities of illicit drugs & also a key tran- less frequently. In 2017, a sharp increase in sit country for drugs destined for other Eu- herbal cannabis seizures was recorded, almost ropean & non-European countries. 10 times more than 2 years before. The quanti- ty of cocaine seized has remained stable over The Italian illicit drug market is dominated by the last few years and the quantity of heroin large organised crime structures with well-es- seized has declined steadily since 2008. The tablished international links and operating quantities of the synthetic drugs MDMA/ecsta- bases in principal drug production and traf ck- sy, amphetamine and methamphetamine ing regions, such as South America, South-East seized remain low”. Italy - Threat Assessment - 202 Page 17 of 57 fi fi fi fi fi fi fi fi fi fi fi 1
The European Monitoring Centre for Drugs create fear by punishing those that do not and Drug Addiction in 2019 reported37 that “a comply, and rewarding those that do. third of the Italian population aged 15-64 years Extortion methods extend to demanding had used a psychoactive substance at least money for safe passage on national roads, or once in their lifetime and 1 in 10 had done so requesting subsidies for the distribution of wa- in the last year. The majority of users are male. ter and electricity. Legitimate business owners Cannabis is the most widely used substance, are forced to pay part of their earnings as pro- with 1 out of 10 people having used it at least tection money from both those extorting and once in the last year. The use of cocaine, opi- from others who otherwise would do the same. oids and spice (synthetic cannabinoids) is low- These payments are referred to as “pizzo” er. Among adults reporting the use of illegal payments. Protection rackets often use high psychoactive substances in 2017, 1 in 10 re- levels of violence to achieve their objectives. ported polydrug use. The 2017 school survey among students aged 15-19 years reported 6.8 Loan Sharking: The 2016 FATF MER39 that cannabis is the most used substance highlights the signi cant risk of money laun- among adolescents. One third reported having dering stemming from activities associated used cannabis at least once in their lifetime”. with organised crime, such as loan sharking. This crime is also one of the main proceeds A third of the Italian population aged 15-64 years used a psychoactive substance at generating crimes in Italy (15% of total). Ma a least once in their lifetime clans exert control and gather funds through European Monitoring Centre for Drugs & Drug Ad- the use of loansharking, extortion and usury to diction accumulate funds and exert control. Italian po- In young adults (15-34), penetration rates for lice forces reported 9,954 cases of extortion to drugs were cannabis at 20.9%, MDMA at 0.8% the judicial authority in 201840, and in “the and cocaine at 1.7%, with an estimated num- Northern Italian province of Novara, in Pied- ber of high risk heroin users of approximately mont, recorded the highest number of usury 235,000 in 201538. cases per 100,000 inhabitants. More speci cal- ly, the usury rate amounted to 1.4 cases per 6.7 Extortion: According to the Europol OC 100,000 residents. Furthermore, the provinces Report, Ma a groups and OCGs are said to be of Naples, Ascoli Piceno, Teramo, and L'Aquila continually exploring opportunities to control ranked second with one case, respectively”. territories and gain in uence. They extort money from businesses and individuals by In the 2018 UIF Annual Report41, the UIF advis- levying taxes / excises in return for security or es that a review was undertaken and it was other services. They exert control on the labour concluded that the reporting institutions expe- market, trade and productive activities and rienced limitations to detect cases of usury, and that reporting levels were low. Italy - Threat Assessment - 202 Page 18 of 57 fi fi fl fi fi 1
Usury is highlighted as one of the major crimi- The top 3 commercial sectors for in ltration by nal behaviours identi ed in the NRA, and it the Italian Ma a are construction, wholesale & warns that the “the nancial crisis has offered retail trade & hotels, bars & restaurants. Other further opportunities for criminality”. sectors to note include agriculture & shing, mining & quarrying, manufacturing, energy According to Reuters42, “reports of criminal supply, waste & scrap management, transport- loan-sharking rose 9.1%, underscoring concern ation, real estate services, hospitals and resid- that struggling rms and families would have to ential care and clubs and gambling activities. turn to illegal nancing networks to make ends meet”. Ma a Top 5 Sectors Regions Groups According to the UK Newspaper, The Guardi- Italian Ma a Construction, Wholesale & Retail Trade, Hotels Bars Sicily, Campania, Lombardi, & Restaurants, Clubs & Gambling, Waste/Scrap Calabria & Lazio. an43, the Italian head prosecutor said that Management Chinese Groups Financial & Insurance activities, Wholesale & Retail Tuscany, Lazio, Lombardi, Veneto, “usury activities by the clans had become in- Trade, Real Estate activities, Personal service Campania & Sicily activities, Manufacturing, Hotels Bars & Restaurants creasingly insistent in recent months, with the Russian / Georgian Transportation, Wholesale & Retail Trade & Lazio, Puglia & Tuscany Groups Agriculture. bosses taking #advantage of the dif culty en- Other OCG’s Wholesale & Retail Trade, Hotels Bars & Restaur- Calabria, Piedmont, Tuscany, ants, Real Estate activities. Support services Liguria & Lombardi activities, personal service activities, Financial & Insurance activities, Construction & Transportation. trepreneurs are nding themselves in during Source: https://www.transcrime.it/wp-content/uploads/2015/11/Project-ARIEL_Final-report.pdf this pandemic”. Mobsters offered them loans with interest rates of over 400%. In the Transcrime OC In ltration of Legitimate 6.9 Business In ltration, Bankruptcy & Cor- Businesses in Europe Report 201544, construc- porate Offences: In ltration of legal business- tion is attractive to organised crime because it es, particularly by Italian organised crime has “characteristics that are particularly attract- groups, is driven by the motivation of generat- ive to OCGs, such as low levels of technology, ing additional pro ts, or by enabling the con- high territorial speci city, and high labour in- cealment of criminal activities. Some southern tensity” and “it registers a large presence of Italian regions for example Sicily, Calabria and public resources and is closely connected with Campania have a traditional deep rooted and the procurement process.” almost exclusive presence of Italian ma a in- The wholesale and retail trade sector generally vestments. By contrast, central and northern serves the purposes of concealment of crimi- regions, for example Lazio and Lombardi, reg- nal activities and money laundering. The sec- ister evidence of in ltration by both Italian and tor, in fact, is characterised by the presence of foreign organised-crime groups. a wide range of sub-sectors that can be ex- A mechanism to in ltrate companies includes ploited for illegal activities of different kinds, buying insolvent business, or lending to busi- such as counterfeiting (e.g. in the case of the nesses that otherwise become insolvent. wholesale and retail trade of clothing and tex- tiles) or drugs traf cking (e.g. in the case of import/export companies. Also transport Italy - Threat Assessment - 202 Page 19 of 57 fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi 1
owned by the in ltrated companies can be quented by the Italian public. Not only does used for criminal purposes. this activity generate signi cant legal pro ts, it also presents an opportunity to launder money Hotels, bars and restaurants are location spe- through this cash only business46. ci c and therefore within OC territories and are cash-intensive businesses. These character- 6.11 Illegal Waste Traf cking: According to istics make them vulnerable to OCG in ltra- the NRA both in 2014 and in 2018, illegal tion. In particular, businesses operating in this waste management traf cking is highlighted as sector are used for money laundering and as having a lesser degree of severity, than other covers for criminal activities. Moreover, the in- crimes such as drug traf cking but still con- ltration of bars and restaurants may be in- sidered of “signi cant importance,” and mostly strumental to the establishment of strategic identi ed as attributable to organised crime - relations with important persons such as public ma a groups. Reports from Italy47 con rm il- of cials and professional. legal activity is signi cant as, “over nine thou- sand people were arrested between 2002 and The Transcrime 2015 OC Report 201545, also 2019 for illegal waste traf cking. Additionally, identi ed emerging sectors, “like renewable two thousand individuals were arrested for this energy and petrol and gas supply. Criminal in- crime. In illegal waste traf cking in Italy, 1,195 ltration in these sectors may serve different companies and 46 foreign countries were in- purposes, such as control of the territory or the volved. Between 2002 and 2019, almost 54 mil- obtainment of extra pro ts. For example, the lion tons of waste were seized. Among the presence of EU grants and tax subsidies in the waste seized, there were also industrial lime renewable energy sector makes it particularly and special waste”. attractive to OCGs. At the same time, the pro- cess of selecting the locations in which to de- Europol reported48 that “Along with striving to velop renewable energy projects is vulnerable reduce expenses, economic crises and struc- to criminal exploitation, especially in territories tural challenges in different industrial sectors where OCGs have strong in uence and the encourage the proliferation of illegal waste public institutions are weak.” disposal services. This demand causes organ- ised crimes groups (OCGs) to specialise in 6.10 Gambling: Legalising gambling in Italy waste management. Legal business structures was supposed to help curb the in uence of the are an integral aspect of this crime phe- Ma a, who have been long involved in illegal nomenon. However, the companies involved in gambling. Instead, the Ma a have moved into such activities engage in a number of crimes this business too. Estimates suggest that Ital- for which they are usually prosecuted”. ians wager €80 billion a year, with half of that going into 400,000 video slot machines, In 2019, Europol49 launched an operation to housed in places like espresso bars, and fre- address exploitation of businesses by criminals Italy - Threat Assessment - 202 Page 20 of 57 fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fl fl fi fi fi 1
who “legally register companies and present 6.12 Counterfeiting & Smuggling (C&S): themselves as $facilitators"!for waste manage- The NRA 2018 includes C&S as a “Very Signi- ment and disposal services asking much lower cant” threat. prices than other companies on the legal mar- 6.12.1 Counterfeit Goods: In 2018, the ket. The plastic waste they pretend to recycle OECD51 estimated that “the total value of on paper then ends up on illegal dumping counterfeit and pirated Italian goods sold sites. OCGs traf c waste both inside and out- worldwide at over €35 billion for 2013, equiva- side the EU. Plastic waste is typically transferred lent to 4.9% of global Italian manufacturing from one Member State to another to avoid sales. This resulted in over €25 billion in lost disposal fees or other costs associated with the sales by Italian companies in a year when Italy"s proper disposal of waste products in accord- GDP was €1.6 trillion. The fake items were im- ance with EU regulations.” ported mainly from China (50%) and Hong In one operation, waste was traf cked to China Kong (29%), followed by Greece (6%), Singa- (where forged documents were identi ed) us- pore (4%) and Turkey (2%). The highest losses ing Slovenia as a transit country. The operation in sales, in euro terms, in the Italian wholesale recorded approximately 560 illegal shipments and retail sectors due to counterfeit and pirat- at an estimated total value €8 million (one ed imports in 2013 were for high-tech elec- shipment was estimated to be between €10 tronic, electrical and optical products, followed 000 and €15 000). This investigation was linked by clothing, footwear, leather and related to “an Italian anti-ma a investigation into illicit products. In terms of market share, the biggest traf cking of textile waste to Africa from the Ital- losses were in the watch and jewellery sector, ian ports of Genoa, Livorno and Trieste. The where the counterfeit market caused a 7.5% companies involved in this illegal activity were loss in sales. The report shows that around half also operating as brokers and carriers in a par- of the fake goods smuggled into Italy in 2013 allel plastic waste traf cking scheme”. Mem- were sold to consumers who were aware they bers of the network Italian and Chinese) were were buying fake products, with the remaining af liated with the Camorra, and were active in share purchased unknowingly”. the textile waste sector in Campania and Tus- “In Italy, at least 88 000 jobs were lost altogeth- cany. er due to counterfeiting and piracy. That repre- In it’s October 2020 infringements package50, sents 2.1% of full-time equivalent employees in the European Union announced that it would sectors directly affected by counterfeiting in be sending a formal notice to Italy for “failing Italy. In 2016, in Italy, forgone tax revenues from to adopt a national programme for radioactive the retail and wholesale sector amounted to waste management compliant with the re- €4.3 billion. That same year, forgone tax rev- quirements of the Spent Fuel and Radioactive enue from Italian right holders to the Italian Waste Directive”. government amounted to €6 billion. Altogeth- Italy - Threat Assessment - 202 Page 21 of 57 fi fi fi fi fi fi fi fi 1
er, trade in counterfeit and pirated goods re- are in circulation, with a total value of around sulted in a reduction in Italian public revenues €1.2 trillion54 (US$1.34 trillion). Based on con- equal to almost €10.3 billion, the equivalent scated counterfeit banknotes seized, the of 3.2% of the taxes were collected on value- market for counterfeit Euros in 2018 was ap- added, personal and corporate incomes as well prox €28 million (US$31 million). as social security contributions, or 0.62% of Ital- 6.12.3 Cigarette Smuggling: Cigarette ian gross domestic product”. smuggling causes huge losses across the EU Member States and the EU, including in Italy, According to the Kroll Global Fraud and Risk where smokers still represent one of the Report 2019/20, “Because Italy"s manufactur- highest per capita population. According to ing base focuses substantially on luxury goods, the Tax Foundation55 “the EU consumed €38.9 the country is a perennial target for counterfeit- billion ($46.4 billion) of counterfeit and contra- ing. Italian respondents are thus more likely to band (C & C) cigarettes in 2019, representing report being affected by counterfeiting (23% 7.9% of total cigarette consumption and a loss vs. 17% globally) and to make the ght against of €9.5 billion ($10.6 billion) in tax revenues”. counterfeiting a priority (70% vs. 58% Italy imports most of its cigarettes, with a signi- globally).” cant market for counterfeit cigarettes. Accord- ing to a RUSI Report in 2017, the Italian ma a According to the Trends in Trade & Pirated involvement in this sector is well entrenched. Goods Report 201952 by the EUIPO & OECD, Illicit cigarette consumption by region identi- 3.3% of world trade (& 6.8% of EU imports) in es Campania at 33% and Friuli Venezia Guilia 2016 was made up from trade in counterfeit at 21%56. goods. Italy is estimated as having a low propensity to export counterfeit products with 6.13 Tax Evasion: Italy has amongst the high- a score of 0.152/1 (2016) with export trade to est rates of personal and sales taxes in the the rest of the world. Based on 3.3% of global OECD. It also has one of the highest levels for trade, estimates for counterfeit imports into tax evasion. Italy would amount to US$14.3 billion. According to the 2018 NRA, the amount esti- mated for tax evasion was €86.4 billion, being 6.12.2 Counterfeit Currency: The Bank of the average annual value for the period 2011- Italy53 reported that most counterfeits Euros 16, down from €140 billion. Of this new gure, (96.4%) were found in euro area countries, & the estimate for tax evasion due to non-pay- that the most commonly counterfeited denom- ment of taxes, and errors in completing tax re- inations globally were the €50 and the €20 turns, is €13.2 billion. It is likely that a signi - notes, which jointly accounting for over 70% of cant amount of funds undeclared to the Italian all counterfeits)”. According to the European tax authorities are held offshore, with Italians Central Bank, (2019), 22 billion euro banknotes Italy - Threat Assessment - 202 Page 22 of 57 fi fi fi fi fi fi f 1
particularly favouring Switzerland, Monaco, the Internal Revenue Agency”. Notwithstanding San Marino & Liechtenstein57. this, the report also highlights that “The Italian judicial system is commonly recognised as one According to a 2018 OC in EU Report report,58, of the most disorganised and slowest in Europe the national industrial association claimed that and tax-related proceedings are no exception. the total tax and contribution evasion in 2015 In a country where tax evasion is widespread, amounted to €122 billion — about 7.5% of different governments have attempted to put in GDP. place remedial counter-actions”. According to the 2016 FATF MER, “Tax evasion 6.14 Human Traf cking: Italy has been cate- (i.e., income tax evasion and VAT fraud) is by far gorised as a Tier 2 country in the last 2 US Traf- the single most important source of proceeds cking in Persons Reports in 201961 and of crime….. Tax and excise evasion (around 202062, slipping down from Tier 1 in the previ- 75% of total proceeds of crime)……By value, ous 3 years. most tax evasion takes place in northern Italy; tax evasion in the southern regions, while more Tier 2 status is assigned to countries whose widespread, tends to involve smaller governments do not fully meet the the US Traf- amounts.…The authorities have been success- cking Victims Protection Act’s minimum stan- ful in bringing a number of cases to justice, in- dards but are making signi cant efforts to cluding large, complex tax fraud cases”. bring themselves into compliance with those standards.“The Government of Italy does not According to the European Commission in fully meet the minimum standards for the elim- 2020, the highest VAT gap (€35.4 billion) was ination of traf cking but is making signi cant recorded in Italy - 24.5%. In 2018, the EU-28 efforts to do so”.…”the government reported Member States (MS) recorded a median gap of fewer traf cking investigations, prosecutions, 9.2%59. and convictions compared to the prior report- Italy is ranked 41/133 according to the Finan- ing period and did not report sentencing data. cial Secrecy Index 202060. In the report on Italy The government remained without a national it states that: “Italy plays an important part in action plan and did not consistently implement the international tax system both as EU Mem- its national victim identi cation and referral ber and as a sovereign player that has signed mechanism”. bilateral covenants with several jurisdictions”. Tier 2 country US Traf cking in Persons - 2020 “Although Italy faces signi cant money laun- dering risk, mainly coming from tax-related “Victims originate primarily from Nigeria and crimes associated with organised crime, cor- other African countries, China, Romania, and ruption and drug traf cking, it has robust tax other Eastern European countries, and include laws. Those are strengthened by the guidelines ethnic Roma. Traf ckers, often part of Chinese Italy - Threat Assessment - 202 Page 23 of 57 fi fi fi fi fi fi fi fi fi fi fi fi 1
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