Targeting the Profits of Illicit Drug Trafficking through Proceeds of Crime Action

Monograph no. 52

Michael McFadden, Martin O'Flaherty, Paul Boreham, Michele Haynes

Current methods of reporting the impact of proceeds of crime action typically underreport their effect on drug trafficking activity. This is because they rely principally on the raw value of confiscated assets without considering the downstream impact of assets denied on the future operations of the drug trafficking organisation. To address this deficit, the authors developed the Proceeds of Crime Drug Disruption Index (POCDDI), which attempts to better capture the short and medium-term impact of proceeds of crime action, taking into account current knowledge regarding the profitability and reinvestment behaviour of drug traffickers at different stages of the production and distribution process. Results support the argument that the raw value of confiscated assets substantially underestimate the real impact of proceeds of crime action, with medium-term estimates suggesting an impact of 11.9 times raw value for distributors, importers and producers of illicit drugs. Analyses of data provided by the Australian Federal Police also addressed the question of what factors are associated with successful or unsuccessful proceeds of crime actions, taking into account asset type, value, offence type and time elapsed at different stages of the case.