Why Environmental Crime Matters to Financial Services
An estimated $400–500 billion is generated globally each year from environmental crime, making it one of the largest and fastest-growing criminal markets in the world.
Following a recent training session with Baker Regulatory Services, one thing became clear: this isn’t a distant issue. The same financial systems, structures and transactions that happen every day can play a role in enabling it.
The scale is staggering, but what does that really mean?
Environmental crime is now one of the largest and fastest-growing criminal markets in the world. Estimates place its value in the hundreds of billions of dollars each year. Illegal wildlife trafficking alone is thought to generate around $20 billion annually, ranking alongside drugs, arms, and human trafficking. But what sits behind these numbers?
It is easy to read statistics like these and move on. Harder to pause and consider what they represent. Entire ecosystems degraded. Forests cleared at an industrial scale. Species pushed to the brink, or beyond it. Not just elephants, rhinos, and tigers, but coral reefs, plant species, fish stocks. And the impact does not stop with the environment. What happens when these systems collapse? What does that mean for communities that rely on them, for economies built on them, for global stability?
Environmental crime is not just an environmental issue. It is a human one.
Why is this still happening?
One of the more uncomfortable takeaways from the training was this: environmental crime persists because, in many cases, it works. It is highly profitable. It is often lower risk than other forms of organised crime, whilstenforcement, particularly on the financial side, has historically lagged. If a shipment is seized, what happens next? Are the financial flows investigated with the same rigour as drug trafficking or sanctions breaches, or does the organised crime network simply absorb the loss and continue?
Criminal groups are adaptive. They do not operate in isolation. The same routes used for drugs, weapons, or human trafficking are often used for wildlife, timber, and other environmental goods. Legal and illegal trade blend together. Documentation appears legitimate. Supply chains look credible unless someone chooses to look more closely. As a result, these risks often go unnoticed, not because they are invisible, but because they are not widely understood.
Where does the financial sector sit in this?
Every stage of environmental crime generates financial activity. From the point of extraction or poaching, through local traders, exporters, logistics providers, intermediaries, and ultimately into global markets. Structures are built. Payments are processed. Assets are acquired. Profits are layered. By the time those funds reach an international finance centre, the origin may feel distant, abstract even. But is distance the same as disconnection?
A client is unlikely to present themselves as being involved in environmental crime. Instead, they may appear as a legitimate trading business, an investor, a manufacturer, or a politically exposed individual operating in a connected jurisdiction. Their exposure may sit deeper, within supply chains, underlying assets, or associated counterparties. So the question becomes; are businesses only looking at who the client is, or are we also asking what sits beneath?
For financial services businesses, the risk is rarely direct. It is not about illegal logging happening locally. It is about whether the proceeds, structures, or enabling mechanisms pass through the system undetected.
Exposure can come through industries where legal and illegal goods are easily mixed. Through jurisdictions where corruption risk is higher. Through complex ownership structures that obscure underlying ownership and activity. Through assets such as ships, aircraft, commodities, or investments that move across borders and through multiple regulatory environments.
None of this necessarily looks unusual at first glance. Which is exactly the point.
What does “something not quite right” actually look like?
One of the most practical takeaways from the session was also one of the simplest: pay attention to discomfort. Not everything presents as a clear red flag. Sometimes it is a feeling that something does not quite align. Why the urgency? Why the reluctance to provide detail? Why the inconsistency in explanations? Why the lack of clarity around supply chains or sourcing? Why does the commercial rationale feel incomplete?
These are not conclusions, they are starting points for further investigation. Perhaps the better question is: do you give yourselves the time, and permission, to explore them in greater detail?
Beyond process: the role of culture
At Affinity, we recognise that controls, policies and procedures are essential, but they are only ever part of the answer. Their effectiveness depends on the culture they sit within. We focus on creating an environment where people feel able to question, challenge and escalate concerns early, even when an issue is not yet fully formed.
Some of the most valuable insights come from those closest to the detail. Not because they have all the answers, but because they are best placed to notice when something does not look right. We actively encourage that perspective and treat it as a strength, not a disruption.
Environmental risk is not viewed as a standalone or specialist issue. We assess it as part of the wider financial crime landscape, interconnected with AML, sanctions, corruption and broader ESG considerations. By embedding environmental risk into everyday thinking, rather than isolating it, we are better placed to identify issues early and respond appropriately.
That mindset shift is deliberate, and it matters.
There is reason to be optimistic, but it comes with a caveat.
Awareness is growing. International bodies, regulators, financial intelligence units, and organisations are paying more attention. Operations are becoming more coordinated. Financial flows are increasingly part of the conversation, not just the physical goods.
But progress depends on participation. Not just from governments or enforcement agencies, but from the private sector. From firms asking better questions. From individuals taking a moment longer to understand what sits behind a transaction. Because ultimately, environmental crime continues where it is enabled.
So let’s leave you with a final question: as the proceeds of environmental crime pass through financial systems, how confident are you that you would recognise it?
