Financial Crimes 3.24 Financial crimes can damage the stability, confidence and reputation of the financial sector and threaten the CARICOM Single Market and Economy. Financial crimes include acts such as insider trading, fraud, kickbacks, embezzlement, identity theft, money laundering, terrorism financing and securities fraud. These crimes present the Region with a host of new challenges and often have particularly devastating effects on the social and political aspects of a nation. They can cause significant harm to individuals, businesses, institutions, threaten the integrity of the banking and financial services industry, and may undermine the financial stability of the Region. 3.25 Money is at the heart of all organised crime. CARICOM States are particularly susceptible to money laundering, due to the prevalence of the illicit drugs and illegal firearms trade which has required complicity from the facilitators of crime, as well as gaps in the state’s ability to manage information, utilize intelligence and trace records. Money laundering cycles the proceeds of crime back into the legitimate economy, which allows some powerful criminals to masquerade as respectable citizens. These illegal funds then finance other criminal activities. Corruption 3.26 Corruption serves to facilitate and fuel criminality, undermines national and regional institutions, generates popular anger, undermines law enforcement, promotes a culture of lawlessness and has a damaging effect on the integrity of the Region. Corruption is a key obstacle to CSME advancement, and a major threat to CARICOM. 3.27 Corruption negatively affects the judicial systems, law enforcement and security agencies and undermines the ability of the protective services and government officials to defend the national interests of the state. 27