--- title: "Financial Crimes and Their Risks to National Economies | Ghazi Mahmoud" url: https://ghazimahmoud.com/en/articles/2025-10-13-e533cf/ lang: en description: "On the eve of the Summit on Combating Financial Crimes, held under the patronage of the Minister of the Interior on Wednesday, October 15, at the Middle East Airlines Training and Conferences Center in Beirut, it is essential to shed light on this type of crime, demonstrate the obstruction and failures it inflicts on economic activities, and highlight the threat it poses to the stability of national economies by preventing their growth and development." --- [All articles](https://ghazimahmoud.com/en/articles/) # Financial Crimes and Their Risks to National Economies [Brig. Gen. (Ret.) Dr. Ghazi Mahmoud](https://ghazimahmoud.com/en/about/) 13 Oct 2025 · 5 min read [Banking and money](https://ghazimahmoud.com/en/articles/money/)[The world economy](https://ghazimahmoud.com/en/articles/world/) On the eve of the Summit on Combating Financial Crimes, held under the patronage of the Minister of the Interior on Wednesday, October 15, at the Middle East Airlines Training and Conferences Center in Beirut, it is essential to shed light on this type of crime, demonstrate the obstruction and failures it inflicts on economic activities, and highlight the threat it poses to the stability of national economies by preventing their growth and development. This is particularly pertinent as the world has witnessed in recent decades a surge in the volume and diversity of financial crimes as a result of globalization, the rollback of restrictions and protectionist policies for national economies, and the growth of cross-border financial flows, in addition to the advancement of technological tools encompassing transfers and other financial operations. These crimes have evolved and grown so complex that they have gone beyond being a purely financial phenomenon whose perpetrators seek illicit gain, becoming instead an issue that affects the economic security of states as well as their political and social stability. According to the United Nations definition, financial crimes are: "any unlawful conduct committed with the intent of obtaining a financial benefit or avoiding a financial obligation through the use of fraudulent or devious means." This definition encompasses a wide range of practices ranging from fraud, embezzlement, tax evasion, administrative corruption, and manipulation of financial markets, with money laundering forming their central pillar. Weak transparency, declining institutional oversight, and the entanglement of money and power create fertile ground for these crimes to flourish, making them among the most prominent structural challenges facing contemporary national economies, given the market disruption, erosion of trust in institutions, and decline in growth rates that they cause. Financial fraud: This aims to achieve illicit financial gains through all manner of fraudulent methods, such as manipulating accounting data, issuing counterfeit securities, cyber fraud, and Ponzi schemes. Embezzlement: This consists of individuals misappropriating funds entrusted to them by virtue of their official responsibilities. It is prevalent in public and banking institutions, causing direct financial losses as well as reputational losses that lead to a collapse of trust in institutions. Crimes involving the embezzlement of public funds are linked to administrative corruption. Tax and customs evasion: Through this, a taxpayer seeks to evade, wholly or partially, the payment of taxes or duties owed, by underreporting declared income or fabricating fictitious expenses, engaging in fraud and forgery in accounting records and shipping invoices, and violating established tax laws and regulations. Bribery: Through bribery, interested parties seek to obtain undue advantages, such as expediting transactions, pushing through deals or contracts, and carrying out illegal acts. Bribery leads to discrimination among citizens, creates unequal competition, and drains the national economy. Money laundering: This is any act intended to disguise or conceal the source of funds or income resulting directly or indirectly from the commission of any of the financial crimes mentioned above or other crimes, and to convert them into seemingly legitimate assets through three stages: placement, layering, and integration into the formal economy. The depletion of public revenues constitutes one of the gravest risks of financial crimes, particularly tax evasion, evasion of customs duties, bribery, embezzlement, and corruption. This deprives the state of rightful revenues, weakens its ability to fund public services, and widens public budget deficits, driving governments to borrow. Financial crimes also undermine confidence in the financial system, especially the confidence of domestic and foreign investors, leading to a decline in investment inflows, higher borrowing costs, and a downgrade of the country's credit rating. This distorts the investment environment and weakens the competitiveness of national production. Reports by both the International Monetary Fund and the Financial Action Task Force (FATF) indicate that the volume of money laundered annually is estimated at between 2% and 5% of global gross domestic product, equivalent to trillions of dollars a year, figures sufficient not only to cause structural imbalances in fragile and developing economies, but also to threaten advanced economies. The risks of financial crimes are not confined to the economic sphere, but extend beyond it to threaten national security and serve as a tool for undermining sovereignty and domestic stability, especially if their illicit funds are used to finance terrorist or parallel political activities. The risks of financial crimes also extend to social norms by creating a parallel culture based on justifying illicit profit and encouraging impunity. The means of confronting financial crimes can be summed up in modernizing national legislation and technological tools to keep pace with modern digital crimes such as cryptocurrencies, unusual banking activities, and money laundering through digital assets, alongside cooperation among states and the exchange of information between them regarding suspicious transactions and the freezing of smuggled assets. Confronting financial crimes also requires strengthening transparency and institutional oversight by establishing independent anti-corruption bodies and modernizing auditing and accounting mechanisms, in addition to promoting citizens' financial literacy by integrating the concepts of transparency and accountability into educational curricula to build a collective awareness resistant to corruption. Financial crimes are a constantly evolving problem that threatens the sustainable development of businesses and societies globally, and poses an existential threat to national economies because it weakens the pillars of financial stability and undermines investor confidence in the state. Combating them is not merely a legal task, but a comprehensive national project that calls for integration among politics, the economy, and civil society. This will only be achieved through good governance, an independent judiciary, and the transformation of financial systems into digital operations that ensure traceability and transparency in every financial transaction. By contrast, it is paradoxical that while financial crimes in countries around the world are carried out by individuals or a limited group of people sharing specific dealings, in Lebanon financial crimes took place at the level of the state, which is supposed to prevent these crimes from occurring and prosecute their perpetrators. The Lebanese political class, acting jointly and severally with the Ministry of Finance, Banque du Liban, and the banking sector altogether, committed financial crimes against the Lebanese people, using Ponzi schemes to attract new deposits on which they paid high interest rates, and squandering the savings of the Lebanese to finance public spending and subsidize consumer imports. This caused a financial and economic crisis unprecedented in Lebanon's history, while those responsible for this collapse remain above scrutiny and accountability. Translated from Arabic with AI. [Read it in Arabic](https://ghazimahmoud.com/articles/2025-10-13-e533cf/) ## Published in - [Channel 23](https://ch23.com/Article/303435/الجرائم-المالية-ومخاطرها-على-الاقتصادات-الوطنية) - [MTV Lebanon](https://www.mtv.com.lb/news/1620347) - [Lebanon Files](https://www.lebanonfiles.com/2025/articles/باقلامهم/الجرائم-المالية-ومخاطرها-على-الاقتصا/) ## More on banking and money [All articles on this subject](https://ghazimahmoud.com/en/articles/money/) [8 Oct 2025 · No Banking Reform Before Confidence Is Restored · Channel 23, OZ Arab Media ](https://ghazimahmoud.com/en/articles/2025-10-08-26e642/) [27 Aug 2025 · Lebanese Deposits Between Promises and Solutions · MTV Lebanon, OZ Arab Media ](https://ghazimahmoud.com/en/articles/2025-08-27-bd105c/) [13 Aug 2025 · Lebanon Between the FATF Grey List and the European Blacklist · Channel 23, Lebanon Files ](https://ghazimahmoud.com/en/articles/2025-08-13-62dae3/)