Where does the money flow? An exploratory study on the financial structures of organised crime linked to child sexual exploitation

This scoping review represents the first comprehensive examination of the economic and financial structures of serious crime organisations (SCOs) linked to child sexual exploitation (CSE). By synthesising academic and grey literature published between 2014 and 2024, alongside expert interviews conducted in Colombia, South America, this research provides crucial insights into the financial features, transactional characteristics, and supply-demand dynamics that fuel this illicit market. The study aims to inform criminal investigations and policy development by illuminating the operational economic patterns of SCOs engaged in CSE. The findings reveal the diverse structures of these organisations, ranging from small, localised groups to sophisticated transnational networks. The study also highlights the prevalence of business-like models employed by SCOs, their interconnectedness with other illicit markets, the preference for types of transactions that prioritise anonymity, the supply and demand influencing factors, and the critical need for a comprehensive, preventative approach to combatting CSE.

Corporate operational models in CSE
The structures of SCOs involved in CSE demonstrate considerable variability, ranging from small gangs to complex transnational networks (Kara, 2017; Taylor, 2019; Aronowitz & Veldhuizen, 2021). Additionally, SCOs frequently adopt business-like operational models, mirroring legitimate enterprises in terms of their focus on maximising profits and minimising costs (Krylova & Shelley, 2023; Aronowitz & Veldhuizen, 2021; Meyer, 2018; Demarest, 2015). These models often incorporate strategies related to recruitment, marketing, market segmentation, and financial management (Meyer, 2018; ECPAT, 2016; Hopkins et al., 2024; Palacios, 2022; Krylova & Shelley, 2023). The specific model used can be influenced by the cultural context and specific criminal group involved (Krylova & Shelley, 2023; Lugo, 2020; Palacios, 2022).
The literature also indicates that this business is characterised by low risk and exorbitant profits (Demarest, 2015; Lugo, 2020; Kara, 2017), despite the lack of reliable estimates regarding its overall market size. Estimates of the number of CSE victims vary widely, ranging from 945,000 to 12 million children (Miller-Perrin & Wurtele, 2017; Lasonder & Fiander, 2024). These discrepancies arise from differing definitions and methodologies, which hinder the production of accurate data on the phenomenon. In the digital realm, the Into the Light Index estimates that over 300 million children under 18 have experienced online sexual abuse and exploitation within the past year (Fry et al. 2024), underscoring the alarming scale and urgency of this issue.
Analogous to that identified by Taylor (2018) in the United Kingdom, expert interviews in Colombia revealed a predominance of small, locally-operating organisations, typically comprising 3–5 individuals, with no apparent connections to larger transnational networks. The leaders of these organisations often have past involvement in sexual work and distribute responsibilities following a corporate structure, with defined roles such as recruitment, transportation, provision of locations, and control of victims. By delving deeper into this topic, experts indicated that the transnational trafficking of children for sexual exploitation is not highly prevalent due to strict border controls increasing the risk of apprehension.
Links with drug and trafficking markets
Another finding is the potential link between CSE and other illicit markets, such as drug trafficking and human trafficking (Palacios, 2022; Kara, 2017; Krylova & Shelley, 2023). These connections may be due to the absolute dominance of a criminal group in a region, so that it appropriates all existing legal and illegal activities, or because groups seek to diversify their operations and markets. Nonetheless, expert interviews conducted in Colombia revealed a notable absence of direct links between SCOs involved in CSE and other illicit markets, potentially reflecting specialisation within criminal niches.
Transaction methods and challenges to traceability
The transactions associated with CSE display substantial variation, depending on factors like the type of service, frequency, duration, victim’s age and sexual experience, and the channel employed (ECPAT, 2016; Rai & Rai, 2021; Brown et al., 2022). For example, in Asia, perpetrators pay amounts ranging from USD 300 to USD 500 for sexual encounters with girls who have never had sexual intercourse before, but the price declines as the girls become more experienced (ECPAT, 2016). In Colombia, expert interviews indicated that the value of the abusive encounters could range from 200,000 pesos (USD 45) to 3,000,000 pesos (USD 669), depending on the profile of the victim and the perpetrator, with higher amounts paid by foreign individuals. Of the value of these encounters, the victim usually receives between 30% and 60%.
The predominant mode of transaction in these instances is cash, supplemented by the occasional use of mobile virtual wallets and bank transfers. This observation is consistent with the findings of Roche et al. (2023), who document the continued reliance on cash in physical encounters. This reliance potentially indicates a preference for anonymity and the reduced traceability afforded by cash transactions.
For the distribution and consumption of virtual abusive material, criminals use diverse payment methods to facilitate their operations and avoid detection, including currency remittance platforms, prepaid cards, and cryptocurrencies (Celiksoy et al., 2023; Hopkins et al., 2024; Roche et al., 2023; Krylova & Shelley, 2023). The channels through which perpetrators access the material include forums and specialised Dark Web sites, but also abusive livestream sites (Alianza Global WeProtect, 2021; Celiksoy et al., 2023; Van der Bruggen & Blokland, 2021). According to a report by WeProtect Global Alliance (2021), there are more than 3,000,000 accounts registered on the top 10 most harmful child sexual abuse sites on the Dark Web. Interviews in Colombia revealed that criminal groups often geo-block online content within the country where the exploitation occurs, restricting access in order to make it difficult for authorities to investigate.
“It happens through specialised webcam sites. We face challenges with these platforms because, as you know, they operate using servers, which makes it easy for those managing these sites to display a child in another country, rendering them invisible in Colombia. Therefore, unless the information comes directly from a victim or a witness, detecting that this is happening becomes very difficult.” (Personal communication, semi structured interview 19092024, 2024 )
Supply and demand dynamics
Demand for CSE is primarily concentrated among adult men and is driven by factors such as anonymity, perceived low cost, and the expectation of impunity in certain regions or countries (Demarest, 2015; Kara, 2017). According to Kara (2017), around 6% to 9% of males globally aged over eighteen engage in sexual exploitation with trafficked persons at some point each year. These factors contribute to the perpetuation of the market and emphasise the need for demand-reduction strategies. In Colombia, expert interviews highlighted a correlation between CSE and tourism, with higher prevalence reported in tourist areas such as Cartagena and Medellin.
The CSE victimisation risk is fuelled by the adverse conditions of children and adolescents, particularly those facing poverty, marginalisation, conflict, or displacement (Meyer, 2018; Rai & Rai, 2021; Wurtele, 2017; Lugo, 2020; Kara, 2017; Krylova & Shelley, 2023; Williams et al., 2021). These conditions create opportunities for exploitation and highlight the need for preventative measures. In Colombia, most of the victims are exploited through the desire for better living conditions and many without self-identifying as victims. This lack of self-identification, coupled with Colombia's age of consent being 14, significantly complicates prosecution.
“Tourists assume that [having sex with a 14-year-old child] is normal, that it is allowed because it was negotiated from abroad. They talk about it in a relaxed way [...] the issue of the age of consent. These people come informed that in Colombia, a person who is over 14 years old can have consented sexual relations, but they are not informed that this is not related to sexual exploitation.” (Personal communication, semi structured interview 30/10/2024)