KLEPTOCRATIC ADAPTION TO SANCTIONS: THE ROLE OF BRIDGING JURISDICTIONS

Jodi Vittori (jv603@Georgetown.edu )

February 21, 2024

​

*All views expressed are solely those of the author*

BRIDGING JURISDICTIONS

Definition:

​

Areas that have strong links to the international and financial trade systems, act as important destinations and conduits for ill-gotten wealth, and may be authoritarian or kleptocratic themselves

​

Due to their perceived strategic significance, avoid significant sanctioning or marginalization

​

Potential “bridges”

• UAE
• Turkey
• Saudi Arabia
• Bahrain
• Malta
• Panama

​

​

(SEMI) AUTHORITARIAN DESTINATIONS

Traditional money laundering destinations

• Rule of Law
• Large economy, including real estate
• Strong institutions against expropriation
• Anonymity
• ”Just corrupt enough…”

​

…authoritarian states as “backup” or transit location

As money laundering destinations, bridging jurisdictions are changing the game; key issues include:

- MLATs, extradition, etc

- Sanctions effectiveness

EXAMPLE: UAE

What UAE Offers

• Regulatory capture
• Lack of law enforcement coop
• Lack of domestic free press
• Free trade zones
• Logistics Node
• Real Estate
• Banking & hawala center
• Gold & diamond hub
• Golden visas & citizenship
• Law and PR firms
• Tourism
• Safe streets, good schools, fun nightclubs, etc

What It Can Deliver

• Money laundering
• TBML
• State-led (SWF, state-run banks)
• Access to Western financial system
• Conflict mineral hub
• Human trafficking
• Criminal & conflict facilitation
• Mercenaries
• Arms
• Logistics
• Financing
• Strategic corruption
• Safe haven for people, money, yachts, aircraft….

​

UAE AS OFFSHORE BUSINESS/ �FINANCIAL CAPITAL

Historic

• Iran
• Afghanistan

Emerging (?)

• Russia
• Syria
• Pakistan
• China

Thank you