Money Laundering and Anti-Money Laundering

Abstract

This chapter traces the legal history of money laundering and the policies used to counter it as they have arisen over the past few decades. It first provides an overview of the main characteristics of the contemporary practice of money laundering before discussing the origins as well as the structure and nature of anti-money laundering (AML) policy. The AML policy is founded on one fundamental logic: if most crime is profit driven, then lowering the profits will lower the incidence of crime. In this sense, just as money laundering is a derivative crime, by definition linked to a predicate offense, so too the ultimate object of AML policy is not to reduce money laundering as such but rather to reduce the predicate crimes like terrorism and tax evasion. This chapter also examines international cooperation in the fight against money laundering and the process of policy diffusion involved in the implementation of AML measures across the globe.