Countries must do more to understand the money-laundering and terrorist-financing risks posed by the clandestine business of migrant smuggling, a global finance watchdog said Tuesday.

       Over the past decade, political instability, poverty and the effects of climate change have led to more migrants and refugees, fueling the growth of an illegal industry with annual profits exceeding $10 billion, according to a new report by the Financial Action Task Force.

       Yet many countries don’t consider migrant smuggling a significant money-laundering threat, and few have concrete data showing how their financial-crimes safeguards protect against the risks it poses, the report said.

       The FATF, an intergovernmental body that assesses countries’ anti-money-laundering and counterterrorism-financing policies, identified a number of recommendations in the report. They include strengthening cooperation between countries as well as between governments and financial institutions such as banks, which the FATF said play an important role by filing reports on suspicious transactions that could be linked to migrant smugglers.

       The organization made migrant smuggling one of its priorities under the two-year tenure of its president, Marcus Pleyer. The report represents the takeaways from its work on the issue, the FATF said Tuesday.

       A number of trends have emerged from the growth in migrant smuggling, according to the report.

       Smugglers most commonly use informal money systems to transfer their illicit proceeds, making it difficult for law enforcement to freeze or investigate the funds, the FATF said. On the other hand, smugglers also are increasingly using social media and encrypted messaging apps for recruitment and coordination, which could provide opportunities for investigators to trace their activity, it said.

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       The FATF found limited information establishing a link between migrant smuggling and terrorist money laundering, but it said there was evidence of terrorists receiving money from smugglers along some African migration routes.

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