When we think of financial crime, our minds often jump to white-collar schemes like tax evasion, embezzlement, or money laundering. Hidden beneath the surface of the world’s oceans is a parallel system of financial wrongdoing, one that links illegal fishing to fraudulent accounting, offshore secrecy, and exploitation. The global fisheries sector, worth over $400 billion annually, is rife with financial manipulation. A growing body of evidence shows that illegal, unreported, and unregulated (IUU) fishing is often driven and sustained by sophisticated financial crimes, not just regulatory breaches.
One major tactic involves the use of shell companies and flags of convenience. A single fishing vessel might be flagged in Belize, owned by a shell company in the Cayman Islands, operated through a holding firm in Dubai, and insured by a company in Europe. This patchwork of jurisdictions is designed to obscure the identity of the true owner and make accountability nearly impossible.
Fraudulent subsidy claims are another major issue. Many governments offer subsidies for fuel, gear, or vessel maintenance, especially to support small-scale fishermen. However, large operators often exploit these schemes. There have been cases where owners submitted claims for non-existent vessels or inflated fuel costs, draining public budgets meant for sustainable development. In some countries, ghost vessels, boats that no longer operate, still receive government payments due to poor verification systems.
The seafood trade is also increasingly linked to trade-based money laundering. For example, a catch of yellowfin tuna might be deliberately undervalued in export documents to shift profits to a tax haven. Conversely, it could be overvalued to justify the movement of illicit funds. Because seafood passes through complex global supply chains, often processed, relabelled, and sold through multiple intermediaries, this form of laundering is difficult to trace.
Labour exploitation is another dark corner of fisheries-linked financial crime. On many industrial fishing vessels, workers, often migrants or undocumented individuals, face wage theft, unlawful deductions, or no payment at all. In extreme cases, they may be trapped in forced labour situations. While the physical abuse is severe, the financial exploitation is systemic; salaries are siphoned off, contracts are falsified, and wages are withheld or misdirected into offshore accounts. These acts constitute clear forms of financial crime under international law.
Compounding these issues is weak enforcement. Some ports, especially in countries with limited capacity, turn a blind eye to forged documents or under-reported catch logs. In others, inspectors may be bribed or intimidated. Meanwhile, financial institutions processing payments for these companies may lack the tools or incentives to flag suspicious transactions. This combination of limited oversight and global financial opacity allows organised abuse to flourish.
To disrupt these systems, financial and environmental regulators must collaborate more closely. Fisheries crime should be treated as a financial crime. That means national financial intelligence units and anti-money laundering bodies should flag irregularities in seafood trade payments, vessel ownership patterns, or subsidy claims. Public registers of vessel ownership and beneficial ownership should be mandatory for all flagged fishing vessels. When true ownership is hidden, accountability vanishes. Technologies like blockchain and satellite monitoring can also enhance supply chain traceability, providing greater transparency on the origin, processing, and trade of seafood. Most importantly, governments and international bodies must ‘follow the money.’ Illegal fishing is not just about broken nets and empty quotas, it’s about how money moves through hidden pathways to enable environmental and human exploitation. Civil society and investigative journalists have a critical role to play in tracking these financial flows and holding companies and governments to account.
In conclusion, financial crime in the fisheries sector is not peripheral, it is central.
Kanchelli Iddrisu
Senior Consultant