Virtual Volunteers: a solution looking for policing problems

PurposeCustomer due diligence measures that are employed in the United Kingdom (UK) to detect and combat money laundering are discussed. The UK adopted a progressive regulatory and enforcement framework to combat money laundering which relies, inter alia, on the use of customer due diligence measures to regulate and curb the occurrence of money laundering activities in its financial institutions and financial markets. However, other regulatory measures that could have contributed to the effective combating money laundering in the UK will not be explored in detail since the article is focused on the reliance and use of customer due diligence measures to curb money laundering activities. Accordingly, the strength, flaws and weaknesses of the UK anti-money laundering regulatory and enforcement framework are examined. Lastly, possible recommendations to address such flaws and weaknesses are provided.Design/methodology/approachThe paper discusses customer due diligence measures that are used in the UK to detect and combat money laundering.FindingsIt is hoped that policymakers and other relevant persons will use the recommendations provided in the paper to enhance the curbing of money laundering in the UK.Research limitations/implicationsThe paper does not provide empirical research.Practical implicationsThe study is useful to all policymakers, lawyers, law students and regulatory bodies in the UK.Social implicationsThe study seeks to curb money laundering in the UK society globally.Originality/valueThe study is original research on the use of customer due diligence measures to detect and combat money laundering in the UK.

The mature morphology of most plants can usually be said to consist of three mutually exclusive organs: leaves, stems, and roots. The vast majority of mature morphologies may be easily grouped into one of these mutually exclusive categories. However, during very early stages of development and in many instances from inception, the division between organ categories becomes fuzzy due to the overlap in developmental processes that are shared between the aforementioned mutually exclusive categories. One such overlap has been described at the gene level where KNOXI homologues, transcription factors responsible for maintaining indeterminate cell fate, are expressed in the shoot apical meristem and during early stages of compound leaf development. This study characterizes the occurrence and spatial localization of mRNA of a KNOXI homologue, MaKN1, during the early stages of development in the simple leaves of Myriophyllum aquaticum, an aquatic angiosperm from the family Haloragaceae exhibiting pentamerous whorls of finely lobed leaves. A 300-bp KNOXI fragment was sequenced from M. aquaticum and used in an RNA localization study to determine the temporal and spatial expression of KNOXI during the early stages of leaf lobe development in M. aquaticum. The developmental sequence of leaves of M. aquaticum was also described using scanning electron microscopy. Lobe development of M. aquaticum occurs in two very distinct regions at the leaf base in an alternating fashion reminiscent of a distichous shoot system. It was discovered that MaKN1 expression is localized to both the shoot apical meristem and early stages of leaf primordia development (P1-P7). Initially, MaKN1 is expressed ubiquitously throughout primordia (P1-P3); however, as lobes develop, MaKN1 becomes localized to recently emerged lobe primordia, and disappears as lobes develop basipetally. The pattern of gene expression is indicative of shared developmental processes during early development between shoots, compound leaves, highly lobed simple leaves and unifoliate simple leaves which lack KNOXI expression. These findings are supportive of Arber's less rigid 'partial shoot' theory, which conceptualizes compound leaves as having shoot-like elements.

The heart functions like a pump derived by electrical impulses known as action potentials. A remarkable feature of cardiac action potentials is that they initiate autonomously by specialized cells in the right atrium located in the sinoatrial (SA) node. The action potentials generated by the SA node are then conveyed to atrial myocytes and subsequently to the atrio-ventricular node where the electrical activity is delayed, allowing the atrium to pump the blood into the ventricles. Thereafter, the electrical excitation of ventricles ensues through fibres known as bundle branches. During embryonic development and organogenesis of heart, intrinsic pacemaker activity is one of the many requirements for generation of autonomous electrical impulse and cardiac function. An equally critical aspect of cardiac development is the generation of non-pacing contracting myocytes such as the atrail and ventricular myogenic lineage. Propagation of action potentials in heart, and hence the ability to pump blood into circulation, relies on flow of ions in and out of cardiac myocytes. This intricate balance of ionic flow is generated by proteinaceous gates referred to as ion channels. The so called pacemaker channels, also known as funny channels, If or Ih, control the autonomous electrical activity of the heart as well as the pacemaker activity in certain regions of the brain. Electrophysiological studies have identified distinct functional hallmarks of If channels which make them good candidate for pacemaker activity (reviewed in Accili et al. 2002). Unlike most voltage-gated channels, If is activated upon membrane hyperpolarization. This property allows inward flow of sodium ions during the repolarization phase of the action potential which then depolarizes the membrane potential back towards a threshold for generation of the next action potential. In addition, If current is directly modulated by cyclic nucleotides, independent of kinases, thus allowing quick changes in the duration of action potential and the rapid control of heart beat by the autonomic nervous system. The molecular identity of If channels remained largely unknown until three independent groups simultaneously cloned its gene approximately 20 years after it was first discovered by electrophysiological measurements (Accili et al. 2002 and therein). When expressed in heterologous systems, isolated cDNA clones produce currents that are activated by voltage and modulated by cyclic nucleotides. With regard to this dual mode of activation, these channels are now referred to as hyperpolarization-activated cyclic nucleotide-modulated (HCN). In vertebrates, four such genes (HCN1–4) have been identified. Autonomous pacemaker activity of the heart starts remarkably early during embryogenesis and it is considered one of the first signs of a healthy human embryo. In order to investigate the molecular bases of early cardiac activity, Qu et al. (2008) have examined the contribution of the pacemaker channels to spontaneous beating of cells derived from mouse embryonic stem cells (mESCs) during development in culture, chosen arbitrarily after plating differentiated cells for 2–4 days (early), 5–8 days (intermediate) or 9–15 days (late). Briefly, their study examines the current density of If, its correlation to rhythmicity and HCN isoform expression as well as its modulation by automonic stimulation in early, intermediate and late developmental stages. The authors have drawn several important conclusions which significantly advance our understanding of the mechanisms involved in early rhythmic activity of cardiac stem cells and which suggest that stem cells can be utilized as a faithful model recapitulating the features of heart development. Qu et al. (2008) start by demonstrating a developmental increase in the proportion of cell expressing If and the density of If per individual cell concomitant with an increase in action potential frequency and beating rate. The authors then examine the effect of a specific If blocker (ZD7288) on rhythmicity of single cells and report that micromolar concentrations of ZD7288 reduce beating frequency and inhibit If current in mESCs. These experimental observations make a solid case for the involvement of the pacemaker current in the maintenance of fast and regular beating rate of mESCs. In their study, Qu et al. (2008) also correlate functional expression of the native pacemaker current to expression of specific HCN isoforms. Of the four isoforms tested, HCN2 and HCN3 are the only two that were detectable by Western blots which were performed using vigilantly selected antibodies. Whereas the expression levels of HCN2 remain constant throughout the development, the expression of HCN3 is dramatically decreased in late developmental stages. Qu et al. (2008) then go on to investigate the role of autonomic regulation in mESCs and they test whether modulation of If current contributes to regulation of rhythmicity. They find that treatment of cells with the β-adrenergic agonist isoproterenol (isoprenaline) significantly increased beating rate in early and late developmental stages. Accompanying the increase in beating rate is a positive shift in activation range of If current by isoproterenol. On the other hand, micromolar concentrations of the muscarinic agonist acetylcholine shifted the voltage dependence of If to more negative voltages and decreased the beating rate of differentiated stem cells. Therefore, the authors conclude that the cellular machinery required for autonomic regulation is present and functional at early developmental stages in mESCs. In addition, they propose that modulation of If is a central component of autonomic regulation in mESCs. It is noteworthy to point out that HCN isoform expression and spontaneous beating rate accompanying maturation reported by Qu et al. (2008) are in contrast to previous studies. These variations have been extensively referenced and discussed by Qu et al. (2008) as being either species specific or due to cell line differences obtained from the same species. Qu et al. (2008) demonstrate a steady expression of HCN2 and a decreased expression of HCN3 during development of cells in culture and they argue that the dynamic change in expression level of HCN3 is consistent with the change in activation rate of If during development in culture. However, at face value, the decrease in expression of HCN3 is inconsistent with the increase in If current density during development. Several possibilities can explain this seemingly counterintuitive observation. Firstly, it is possible that high levels of HCN3 in early developmental stages inhibit the functional expression of pacemaker channels. This possibility can easily be addressed experimentally in heterologous systems expressing HCN2 and variable amounts of HCN3. Assuming that HCN3 exerts inhibitory effects, increasing amounts of HCN3 expression is expected to suppress generation of functional channels. Interestingly, one group has reported that HCN3 does not form functional homomers when expressed in heterologous systems (Chen et al. 2001). Secondly, it is possible that robust functional If current is present in early developmental stages but masked by a current flowing in the opposite direction. Although this explanation is formally possible, the authors have carefully chosen an external solution to suppress potassium and calcium channels during the measurements of If. Lastly, it is possible that pacemaker current in early developmental stages is activated at extreme hyperpolarization test pulses outside the range of those used by Qu et al. (2008). Indeed, one proposed mechanism of differentiation of a non-pacing region of the heart is a shift in activation range of If to potentials that are outside the physiological range (Yu et al. 1993). Another intriguing observation by Qu et al. (2008) is the heterogeneity of cells with respect to If and beating rhythmicity in early developmental stages. This heterogeneity can be explained by the presence of a mixture of pacing and quiescent cells, reminiscent of nodal and contracting myocytes in cardiac tissue. This assumption implies that the cells in later stages of development in tissue culture are less differentiated than those in earlier stages. Consistent with this assumption, several studies (extensively referenced in Maltsev et al. 1993) have reported changes in differentiation stage of cells in culture and reversion of differentiated ventricular cells back to embryonic stages. In summary, analogous to all well-conducted scientific inquiries, the studies of Qu et al. (2008) have raised several important questions which will certainly lead to other exciting studies in the future. I am grateful to the Heart and Stroke Foundation of Canada for their continuous support throughout my postdoctoral fellowship.

This paper considers possible future developments which may give rise to criminal sanctions against network providers and those involved in a commercial capacity with the distribution of pornographic material on the Internet. The focus is on the UK government response but the perspective is international. It is argued that the policing problems are not unique to pornography or the Internet. In isolating pornography as an issue and transmission on the Internet as a problem, the policing reaction is seen in the context of the state's overall response to pornography. A combination of the transmission of digital information for possible unlawful purposes and responsibilities of commercial facilitators present policing problems similar to those in money laundering, where they have led to draconian regulations backed by criminal sanctions directed at financial institutions. It is proposed to identify and discuss these developments and consider the applicability of policing methods to network providers and distributors who may, innocently or negligently, be involved in the distribution of pornographic material. Part of this analysis will also involve some limited discussion of the application of money laundering regulations to the Internet. The identification of common themes creates a framework within which the control of electronic data transmission and responsibilities of commercial facilitators are isolated as the central policing problems for the Internet.

Financial technology (fintech) is a double-edged sword. The innovations in fintech have advanced traditional ways of undertaking transactions and provided immense opportunities to individuals and businesses, such as faster and more efficient settlement of payment. However, it has also fueled illegalities such as money laundering, which essentially involves making illegally-gained financial proceeds appear to have legitimate source. This paper will reflect on how technological innovation, particularly cryptocurrencies, digital currencies and fintech solutions enable money laundering; as well as the efforts of international organization (such as the Financial Action Task Fund, the Egmont Group and the Inter-Governmental Action Group against Money Laundering in West Africa) to curb same. It will undertake a comparative analysis of the regulatory actions undertaken in relevant jurisdictions to curb money laundering, specifically, Canada, the United States of America, the United Kingdom and Nigeria. This paper will also highlight the need for anti-money laundering (“AML”) regulators to actively consult with relevant technology stakeholders in order to enact AML regulations which are tailor-made, practical and pre-empt technological advancements. In addition, this paper will argue that since money launderers are ever so creative in their modus operandi, innovative and dynamic technology-based approach should be adopted in tackling money laundering.

The basement membrane, which separates the inner enamel epithelium from the dental papilla in the early stages of tooth development, is known to play a significant role in odontogenesis. In this review article, this basement membrane was described in detail based on our recent findings with the use of high-resolution electron microscopy. Tooth germs of a monkey (Macaca fuscata) and a shark (Cephaloscyllium umbratile) were processed for thin-section observations. During the early stage of development, the basement membrane of the inner enamel (dental) epithelium was composed of a lamina lucida, lamina densa, and much wider lamina fibroreticularis. At higher magnification, the lamina densa in both species was made up of a fine network of cords, which are generally the main constituents of the basement membranes. In the monkey tooth, the lamina fibroreticularis was rich in fibrils, which were now characterized as basotubules, 10-nm-wide microfibril-like structures. The space between the basotubules was filled with a cord network that extended from the lamina densa. Dental papilla cell processes were inserted into the lamina fibroreticularis, and their surface was closely associated with numerous parallel basotubules via 1.5- to 3-nm-wide filaments. In the shark tooth during its early stage of development, the basotubules were absent in the lamina fibroreticularis and only narrow extensions, 60-90 nm wide and 1-2 microm long, of the cord network of the lamina densa were present. The dental papilla cells were immobilized by means of the binding of their processes to the extensions. These results indicate that basement membranes in both monkey and shark teeth at early stage of development are specialized for functions as anchoring and firm binding, which are essential for the successful differentiation of the odontoblasts.

Legal professionals are generally depicted as possible “gatekeepers” to money laundering as a result of the kind of services they render to clients by the Financial Action Task Force (FATF). Consequently, there is the global quest for anti-money laundering obligations to be imposed on legal professionals. However, recent legal development in Nigeria seems to have absolved legal practitioners from anti-money laundering regulations based on the Nigerian Court of Appeal judgment between the Central Bank of Nigeria v Registered Trustees of Nigerian Bar Association & Attorney General of the Federation. This paper critically examines how this development impinges on the fight against money laundering and its implication on legal professionals and the Nigerian polity. Comparatively, the United Kingdom is globally seen as one of the countries that have complied with the FATF Recommendations with specific reference to legal professionals. In this regard, the United Kingdom’s approach is suggested for adaptation by the Nigerian government and Nigerian Bar Association.

Egg presence and developmental stage influence spawning-site choice by female garibaldi

The number of enforcement actions and fines for non-compliance with anti-money laundering (AML) regulations continues climbing year after year, and the year 2021 was no exception to this tendency. Globally, authorities remain harsh, and AML fines in Europe, the United States, and the United Kingdom have been increasing (Global Anti-Money Laundering Regulations, 2021). According to the UN estimations, the amount of money annually laundered worldwide amounts to 2–5% of the world’s Gross Domestic Product (GDP), or in absolute numbers - to 800 billion-2 trillion US dollars. Such high figures indicate that national governments are indeed facing a serious problem of money laundering. In this article, clustering is employed to group the EU member states by their money laundering measuring indices in order to assess the EU legal framework in terms of money laundering prevention. State clustering could help the relevant EU institutions, such as Financial Intelligence Units (FIUs), Europol, International Monetary Fund (IMF), national governments and others, to develop the most effective measures to diminish the problem of money laundering and to complement their regulatory framework. Money laundering is usually associated with criminal activities that generate large amounts of illegal financial resources. In the most general sense, money laundering refers to the process of disguising the true origin, ownership, disposal and movement of particular proceeds, property or property rights. The results of the empirical research propose that money laundering reduction calls for a higher number of suspicious transaction reports (STRs), lower levels of corruption and improvement of the legal framework in terms of money laundering prevention in the EU. The research methods cover comparative and systematic literature analysis, and hierarchical cluster analysis. The cluster analysis of the EU member states (28 countries) uses the number of reports filled with FIU between 2006-2014, the 2012-2020 Basel AML Index and the 1998-2018 CPI data.

Two National Risk Assessments (NRA) of money laundering (ML) have now been published in the United Kingdom (see HM Treasury 2015 and 2017). While both represent an attempt to identify the risks of ML, there are limitations in relation to the conceptual framework and the methodology used. This paper reviews the UK NRAs and considers whether revision of the methodology employed could help to both remedy these limitations and generate more robust findings. Drawing upon the findings of the UK strand of project Identifying and Assessing the Risk of Money Laundering in Europe (IARM), it outlines how a composite ML risk indicator was developed through analysis of threats and vulnerabilities across 43 police areas. The findings demonstrate that risks are highest in the City of London and the Metropolitan Police area, which is largely explained by the presence of organised crime groups, connections to risky jurisdictions and the cash intensity of businesses. Although the findings should be treated with caution, it is posited that this methodology could be used to help future NRAs develop a more robust framework to understand ML risk and ultimately develop more effective preventative strategies.

Buenos Aires, Argentina—Traces of explosives, sharp metal objects, and seemingly innocent liquid containers are checked daily for every passenger trying to board a plane in the United States. A CIA document obtained by Wikileaks describes even more subtle screenings performed by undercover agents in foreign airports looking for signs of nervousness. Customs officers are trained to detect lies, inconsistencies, or unusual behavior. Still, it took years before UBS banker Bradly Birkenfeld's secret for shiny teeth was discovered. He was smuggling diamonds in toothpaste tubes on behalf of American tax evaders.But those days are over. The United States already knows of Credit Suisse bankers deceiving American immigration officers about the real purpose of their visits. Espionage-like code names to conceal clients' identities and encrypted computers are also as old as time, or at least the online universe. With all these tricks now in the open, some have been led to believe that the magic of invisible money is over. They could not be more wrong.Efforts and plots to escape a country's laws and taxes have been going on for as long as there have been taxes and their collectors. One option is to live sailing all year round in a luxury apartment of a cruise ship, effectively becoming a resident of the sea rather than any single nation. Recently, a man in Florida revived the idea of such a large vessel, officially called "Freedom Ship," while others christened it a floating tax haven. Yet more ambitious are "seasteads"—floating cities designed to experiment with innovative political systems. But none of these fantastic schemes pose any real threat to sneaky, land-based tax havens. After all, there are easier and cheaper ways to achieve the same results, without needing to leave the mainland.In order to be successful it is important to remain under the radar. One option is to approach this literally by hiding your identity. Apart from bitcoins and other virtual currencies, today the Internet offers all but limitless options to create a new profile, where imagination has an equal weight with reality, including fake photos, names, Facebook accounts, and LinkedIn work experience. Once this appears in a Google search, an identity is as real as it gets. For amateurs, it's as easy as creating a false e-mail or bogus address when registering at a webpage. For the sophisticated, changing an IP address, simulating GPS location, even using TOR ("the onion router") anonymity software could be equally effective. But black money is not like deep secrets no one should ever unearth. While it is similarly important to keep its location (and origin) hidden, black money is supposed to be used eventually. And the more liberty to spend it, the better.A superior alternative is thus to be less secretive about who you are, but smarter about where you choose to be so as to look legitimate—ideally holding a bank account or creating a company or a trust in a well-respected place. Indeed, many Western first-world countries are being strategically chosen by tax dodgers and money launderers precisely because of their law-abiding history, foreigner-friendly rules, and first-rate financial services that no one would ever (manage to) question. These are the great unknowns of the future in the hidden worlds of subterranean finance—the first real major challengers to the remote offshore islands in the Caribbean and South Pacific that have for so long been the principal stereotypes of tax havens.However contradictory it may sound, ill-gotten money has a lot to do with legality. Just as the Nazis first embarked on their economic actions against Jews within the scope of their racial laws, so trillions of dollars are held offshore under the auspices of tax havens' rules and regulations. Provisions like "no foreign country's inheritance laws may ever be invoked to invalidate a Trust created here" may appear perfectly legal, not because any honest person would ever agree with them, but because they were formally enacted and remain unchallenged. This legal framework that enables the discrete generational transfer, deposit, and enjoyment of illicit financial flows has not happened by chance, but is the result of deliberate and careful policies undertaken by major financial centers.Nevertheless, it's not only written statutes but also tacit social norms that keep the system running. Chatham House researcher Nick Shaxson describes the global community of offshore banking as "a peculiar mixture of characters [who] populate this world: castle-owning members of old continental European aristocracies, fanatical supporters of the American libertarian writer Ayn Rand, members of the world's intelligence services, global criminal networks, assorted lords and ladies, and bankers galore."But as Shaxson explains, silence is guaranteed by accomplices and dissenters alike. For active contributors (such as bankers, lawyers, accountants, and other service providers), it's either a complete indifference to the consequences that corruption and tax evasion may have in places like Africa and Latin America, or directly believing that they are doing the right thing by helping foreigners protect their money from political risk or unstable currencies. In some cases, it's blatantly justified as "poor people in Africa are poor because they don't work hard enough." Sadly, many of the system's foes have also learned neither to criticize nor to ask questions, otherwise they will pay the price of ostracism—losing any chance to get promoted, being socially isolated, attacked by the media, legal persecution (instead of protection for denouncing a wrong-doing), becoming a traitor, or designated as the enemy. As whistleblowers Rudolf Elmer and Antoine Deltour painfully discovered, these are not attributes specific to sparsely populated islands, but are also available in prominent countries in the heart of Europe—Switzerland and Luxembourg in particular.After the financial crisis of 2008 and recent tax scandals by major companies (and countries), a clampdown against tax havens is underway, leaving a trail of bewilderment over which will prevail or what new ones might replace them. With global household wealth calculated at $263 trillion by Credit Suisse and 11 percent of that, or $30 trillion estimated to be held offshore, stakes are high for candidates to attract these funds. Growing inequality will create even more millionaires, certainly billionaires, trying to avoid scrutiny, evade taxes, or both. It's unlikely that one country alone will be able to serve the whole offshore world. After all, most investors—legal and illegal alike—believe in the importance of diversifying. Just as in the international division of labor, tax havens have also learned to cater to specific industries or nationalities. Still, there are clues to the next illicit hotspot.Tax havens can be classified into two large groups. First are those that always come to mind—palm-filled islands scattered across the Pacific Ocean and the Caribbean, and pariah states, which neither sign treaties nor attend international conferences. Nauru in the South Pacific, for example, will still appeal to some erratic criminals, smugglers, and tax evaders. However, no big fish would dare to be (openly) related to it. In other words, it is unlikely that Nauru will be joining the major leagues of tax havens chosen by Fortune 500 companies or Forbes' list of billionaires.The second group comprises the big pretenders. A rule of thumb applied by tax havens suggests that the best way to disguise inaction is by pretending to do something. Otherwise, unwarranted attention will be drawn. Simulating cooperation may be achieved by joining multilateral conventions against corruption, transnational organized crime, or financing of terrorism, but then making subtle reservations to either limit its applications or ring-fence specific territories and colonies. A more popular strategy is to sign a treaty about exchange of bank account information while knowing ratification will never happen or not until a distant future, blaming domestic political rifts for the delay. An equivalent tactic is to run national consultations about new transparency platforms so as to democratically decide that nothing will change.An even more sophisticated ruse is not only to be part of the herd, but to become the shepherd. By ensuring that international rules will be designed and imposed by organizations that include only rich countries as their members (such as the G20 or the OECD), tax havens guarantee that 'global standards' will be consistent with their own interests. An example of this is the OECD Model Treaty to avoid double taxation, which favors capital-exporting countries (instead of developing ones) when it comes to levying taxes. This model agreement also allows big companies to avoid paying any tax at all in the countries where they operate as long as they structure their businesses carefully. This is exacerbated by the OECD Guidelines on Transfer Pricing, which are easily exploited by multinational companies that, through intra-group transactions, shift profits to low-tax jurisdictions and thus avoid paying taxes again. Some of these issues are currently being addressed by a process called BEPS, which stands for Base Erosion and Profit Shifting, but big surprise, it is also run by the OECD.It is already well known that major Internet companies and other well-known retailers make use of the so-called double Irish-Dutch sandwich strategy to avoid paying taxes "legally." It combines U.S. check-the-box rules (to choose how to classify foreign subsidiaries), setting up two companies in Ireland (one to invoice services performed somewhere else, like the United Kingdom, and the other one to "exploit" Irish tax-residency rules), a Dutch company to avoid withholding taxes when transferring profits among the two Irish companies, and finally a company in a zero-tax jurisdiction like Bermuda where profits will finally be transferred. Less understood, however, is what was (not) done to appease the outrage against big companies not paying their fair share of taxes. In an attempt to calm any sense of outrage, the end of the double-Irish was proclaimed, although surprisingly, Ireland was portrayed as the naïve innocent, while big companies and small islands were to take all the blame. The small print, however, reveals a different story.The significant change is that the end of the double Irish will only affect new companies, which had failed to take advantage of the popular scheme. Clever ones, in contrast, will have a transition period through 2020. As if this were not enough, Ireland's prime minister announced the development of a "patent box" regime, which is nothing but the option to "strategically" register patents or trademarks in a place with low taxes, even if no research and development actually took place there. This allows companies to transfer royalties wherever they want to make sure that little to no tax will be paid. No wonder big companies have little to fear from Dublin.Facts are undeniable—like American companies undertaking inversion deals to relocate to Britain as a way to avoid U.S. taxes; London's high-priced real estate sector overheated by foreigner money launderers; British Virgin Islands' surprise ranking as the world's fourth largest recipient of foreign direct investment (receiving more funds than India and Brazil combined, despite its tourist economy and 20,000 inhabitants); Cayman Islands' Ugland House, which alone serves as the residence of 18,000 companies; or Jersey's financial brochure aimed at Russian oligarchs trying to avoid both taxes and Russian inheritance laws.With all this on his plate, Prime Minister David Cameron is passionate about targeting aggressive tax avoidance. He even sent a letter—yes, a paper letter—to British Overseas Territories and Crown Dependencies regarding beneficial ownership registration (politely requesting that they identified the real individuals who own companies regardless of nominees or corporate layers). As a consequence, these tax havens collectively did not hesitate to consult on this new push to establish a truly transparent system. And in an unexpected challenge to the Empire, the Overseas Territories decided to reject the request. Striking back, Cameron decided to impose the central registries of beneficial ownership in the U.K., for whatever marginal use that will likely be in the future, though a tiny—actually giant—loophole was left. Only some trusts would have to register, but even in such a case, their information would not be accessible to the public, leaving a most opportune choice for tax dodgers and money launderers trying to avoid scrutiny.Even without any awareness of Luxleaks, the disclosure of secret tax arrangements between Luxembourg's authorities and some of the world's most important companies, allowing them to reduce their global effective tax rate to about 1 percent, the OECD's Global Forum on Exchange of Information had already highlighted the Grand Duchy in red as "non-compliant with international transparency standards." Furthermore, in an attempt to compete with Singapore, last September Luxembourg proudly inaugurated "Le Freeport," a state-of-the-art free port next to the airport. Interestingly, free ports and special economic zones are supposed to be territories with special rules—no VAT or custom duties, few controls, if any at all—because they are not considered regular parts of a country's territory, but rather logistical hubs where goods in transit are waiting to be delivered to their final destinations.Somehow inconsistent with these transit purposes, Luxembourg's free port offers no-time-limit storage of valuable goods "such as works of art, fine wines, precious metals, jewels and diamonds, vintage cars, etc." Coincidentally, Le Freeport will come in handy to all those trying to escape reporting to the tax authorities that (some) banks will need to start doing about their account holders. The safest option against these new disclosure requirements will be to keep wealth in the form of gold, art, or jewels. No place will be better suited for this than such a locale as Le Freeport. To avoid any doubt as to the real reason behind this venue, Pierre Gramegna, Minister of Finance of Luxembourg, stressed during its inauguration, "I am convinced that this project will add a new branch of excellence to our financial sector and enhance its wealth management capabilities." Expectations seem little related to the handling of goods in transit.Unbeaten at the top of Tax Justice Network's Financial Secrecy Index—a ranking of tax havens according to their secretive legal framework and their market share of financial services for foreigners—Switzerland is by far the most successful case of whitewashing. Swiss statutory banking secrecy originated with a tax evasion scandal involving Swiss banks and members of French high-society. However, it is usually—and wrongly—associated with helping German Jews during World War II. Contrary to this 'Good-Samaritan' myth, the very same Swiss Bergier Commission acknowledged that Switzerland was involved in suggesting Germany identify Jewish German passport holders with a "J," which in many cases prevented them from entering Switzerland and other countries, when trying to escape from the Nazis.In addition, Swiss banks showed concern about "Aryanization" of Jewish assets only when Jews were debtors, and the banks' credits were at stake. The Bergier Commission describes consistent attitudes even after the war. Some Swiss banks deliberately decided not to report unclaimed assets of Holocaust survivors and not to contact heirs, waiting 10 years to destroy all evidence of client relationship. Estelle Sapir's case offers a good example of this. Being a Holocaust survivor, she was easily able to recover her family's bank deposits all over Europe, except in Geneva, where the bank requested her father's death certificate and records of his deposits. The fact that he had been killed in Majdanek Concentration Camp and that she had barely managed to escape made very little difference to the bank. Rules are rules after all.At some point, however, it seemed as if international pressure had started to crack banking After the United States UBS and Credit Suisse schemes to in taxes, it made Switzerland sign a Tax agreement to get information about account holders with Swiss bank Information would thus start to to the But the Swiss would affect only those account holders who to have their information Switzerland decided to exchange information with European countries, very not to market This when French agents their in of Swiss like the and all who and in an to identify French to the wealth the of tax to other countries, developing countries their funds in Swiss Switzerland decided to impose some the agreement where information only to the United the Swiss from other countries would be chosen only if they were and to Switzerland and if they were for the Swiss financial countries to by Swiss for protection of tax dodgers would be to their In of this Switzerland will likely with that it information with other It be if it up that all this was done to and Latin American countries you a big and keep it, people will come to believe Switzerland behind and the United States is this is where the future may be in tax and banking to the the United States is to become the top tax in the world. about all that and about money of terrorism, and tax They are still long as they only to who the United States the a single As The portrayed it, of long between and the of is to percent of the U.S. But more than of the companies are including percent of the Fortune 500 One serves as the address of more than Ugland House in the Cayman This is more than the of Cayman American companies are at for their aggressive tax in Ireland and the United States to be those very same companies against the OECD's which to tax and evasion by multinational this there is some to it. The United States only about American companies paying taxes to the American It has little in helping other countries achieve the same banking the United States is even more with its double enacted rules to foreign banks to the information about holding bank It also imposed a percent withholding tax against any financial in the which failed to or with reporting It had little concern for all the and domestic legal every other country had to to its banks to this information to the United States. But when other countries, such as showed in information about their own with in American the United States only and The United States would report information about of accounts, of and most there would be no to identify individuals trying to avoid reporting by hiding behind some company or In some the United States did to equal of but to a for such Some countries, in were only the choice of all requested information to the United States or being to the withholding then the OECD's own on of financial account called the or which was an of though no their many were led to believe that the United States would also to the so that all countries applied only one To make the even more the special in of American this despite Swiss bank an it to It decided and to This while all countries would have to exchange information with other to the and information to the United States under the United States need not to This way it could foreigners the option to in American banks as a way to limit the disclosure of information to their own It was a tax but only available in the United States. not with an of it would appear that by the United States is to becoming the next big barely international tax a on As if corporate registration process and U.S. banking secrecy enough, such American territories as or the U.S. Virgin an tax free most tax havens and financial far islands, but some of the most important countries of the world. And because they are hiding in they are likely to remain the next big unknowns on the of global either through special or using their related to ring-fence foreign individuals and companies to them from other taxes, laws, and regulations. While the in a tax or of a bank account there not any or illegal it is in fact people who live and work in one place holding bank in countries of The same to multinational companies that create companies in countries with no to the while no nor any but still somewhere or are involved in the international of between to fair market that and tax havens with other in These of tax and to who offers the of taxes, less information and designed to attract trillions of regardless of their or illegal But if all countries the same way to attract money from this would become a where every country would end up levying taxes (and would be The is to be the only one of the very this. This is and under the of and international rich countries rules for others to But when they impose their own like the United always a final up their Irish tax rules, Swiss banking or Luxembourg's secret tax other words, while and may be as tax more consequences may be to ever more innovative and by the world's most important the real and no need to live on the sea or in The top tax havens of the future are to than and so to be and international transparency by of online to or through exchange of information among is the only way to the secrecy and anonymity of tax which tax corruption, and money to Global and in case of are if they some of the world's countries and their financial including the the OECD and its against tax the Global Forum on Exchange of or the Financial against are trying to address these However, they to be by rich countries, so their are with or under political pressure that any real change in the alone against the is it is important to and those that are the most countries), by allowing the United to a more central World Tax and on for in may be some first in the right organizations and have to be real of companies, and countries on the hidden tricks and involving tax and thus to push for real The more information that is to the public, the more the the will be tax and corruption that in the and in the of

PURPOSE – This paper compares the prepaid card laws/regulations in Nigeria, the United Kingdom, the United States and India with the aim of determining the best approach to regulating prepaid cards: that is the approach that promotes financial inclusion and also makes the product less attractive for money laundering. DESIGN/METHODOLOGY/APPROACH – This paper relies mainly on primary and secondary data drawn from the public domain. It also relies on documentary research. FINDINGS – This paper makes the following findings and recommendations: I. Nigeria has the best approach to regulating providers of prepaid cards. Nigeria’s approach could foster financial inclusion and at the same time mitigate the money laundering risks associated with prepaid cards. Nigeria’s approach is not too strict like the Indian approach and it is not too relaxed like the United Kingdom and the United States approach. Operators, including mobile/telecommunications operators, wishing to operate money transfer schemes in Nigeria are allowed to do so with approval from the Central Bank of Nigeria and in strict conjunction with licensed deposit-taking banks or financial institutions. The UK, US and India are recommended to adopt Nigeria’s approach. II. The United Kingdom and the United States have the best approach to regulating agents of prepaid cards. Both countries require prepaid card providers to maintain a current list of agents and make it available to the relevant authorities upon request. The approach allows regulatory agencies to effectively monitor and supervise prepaid card agents. India and Nigeria are advised to clarify their approach regarding the regulation of prepaid card agents. The prepaid card Laws/Regulations of those countries should be modified to specify if the agent of a prepaid card provider is required to be licensed or registered by a competent authority or if the prepaid card provider (the principal) is required to maintain an updated list of agents which must be made accessible to a designated competent authority, when requested. The new changes will afford regulatory authorities the opportunity to effectively monitor and supervise prepaid card agents. III. India’s approach to thresholds would preclude most individuals in the intended target market from accessing basic financial products as most people typically do not have residential addresses that could be confirmed by reference to formal documentation. India should adopt the ‘risk-based approach’ and not the ‘wholesale de-risking approach’. RESEARCH LIMITATIONS – Given their low-risk characteristics, closed-loop cards, specifically cards which do not allow reloads or withdrawals, remain outside the scope of this paper. ORIGINALITY/VALUE – Although there have been researchers who adopted the comparative approach like Jean J Luyat and Will Cain, the comparative approach adopted by those researchers was not detailed enough and also was not aimed at seeking to answer the research question in section 1 of this paper. Both writers focused on only the aspect of Financial Inclusion making the whole research a one sided approach. Jean J Luyat focused on ‘how regulation had an impact on the development of prepaid cards in Japan and Europe’. He was able to discover that prepaid cards were growing rapidly in Japan but not gaining acceptance as a payment method in the European Union (EU) and France. He aligned such growth in Japan to different factors including regulation. He stated that Japan had a simple and flexible regulatory framework compared to the EU and France which have a complex regulatory system with strict prudential requirements. Nothing was said about the money laundering aspect of such regulation and neither was anything said about thresholds and other optional recommendations canvassed by the Financial Action Task Force (FATF). The Electronic Money Directive referred to by Jean J Luyat has already been repealed and a second Electronic Money Directive is in place. A comparative approach is adopted in this research seeking to compare the approach in Nigeria with that of the UK, the United States and India. Each of these countries adopted different approaches. The results are to help answer the research question in Section 1 of this paper. The countries were selected on the basis on how strict their regulatory regime is. India’s regulatory regime is the strictest while the United Kingdom and the United States are the most lenient. Nigeria is caught in between Strict/Lenient.

This chapter provides a background and context for the book. The chapter is, therefore, not meant to be a literature review of the substantive area, but a brief summary of the anti-money laundering (AML) environment. It starts with the history of AML compliance, tracing the first formal regulation on AML compliance to the current system of risk-based approach, which is the current system of operation in the United Kingdom (UK). Accordingly, the legal framework for AML in the UK is discussed. The role of international organisations in the development of AML will also be highlighted before focusing on the UK regulatory environment as the focus of the study. Finally, the role of money laundering reporting officers (MLROs) is discussed in relation to AML compliance since the book is about finding out the main concern of MLROs and how they are resolving it.

The international law of money laundering is found in several United Nations (UN) crime suppression treaties, United Nations Security Council (UNSC) resolutions, and a body of soft law, some of which arguably has crystallized as customary norms. Beginning with the 1988 UN Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (Vienna Convention), states agreed to establish anti-money laundering (AML) measures in their domestic law for drug-related offenses. This was followed by AML measures against organized crime and corruption, respectively, in the 2000 UN Convention against Transnational Organized Crime (Palermo Convention), including its protocols and the 2003 UN Convention against Corruption (Merida Convention). The AML measures include the criminalization of money laundering, powers to freeze and confiscate the proceeds of crime, duties of the private sector to generate financial intelligence, the establishment of financial intelligence units (FIUs), and formal legal cooperation arrangements between states, necessary given the transnational dimension of money laundering. While AML originally covered only property derived from crime, its measures were extended to property used to finance or carry out crimes, most notably for terrorist acts and the proliferation of weapons of mass destruction. Though countries concluded a treaty against terrorist financing in 1999, it was not until after the events of 11 September 2001 that anti-terrorism financing norms, as part of the panoply of AML measures, were diffused around the world by UNSC resolutions. International bodies, including the United Nations Office on Drugs and Crime (UNODC), have prepared model laws to assist countries to incorporate AML measures. The Financial Action Task Force (FATF), established in 1989 by the G7 industrialized nations, is the most important and influential body in setting detailed international standards on AML. Through replication of its norms and functions by regional bodies, the FATF’s soft law of AML measures has hardened into near universal domestic AML laws, adopted to signify the integrity of a country’s financial systems. European nations extensively adopted AML measures by treaties and directives, sometimes going beyond FATF recommendations. As AML measures have grown in number and global significance, critical literature has grown, questioning their effectiveness, whether their benefits outweigh their costs, and whether they are justified from the standpoint of principles of criminal liability and human rights law. For more criminological literature, readers may wish to consult the Oxford Bibliographies in Criminology article Money Laundering. Research for this work was fully supported by a grant from the Research Grants Council of the Hong Kong Special Administrative Region, China (Project No. 17603319). Thanks to Sean Yau and Ting Yin Lau for their research assistance.

As a result of the existence of the ‘Forty Recommendations’, all countries are expected to have anti-money laundering and anti-terrorism financing legislation and regulations. Because most national legislation came into being due to the existence of the Recommendations, the laws of all countries ought to be in pari materia with each other. To illustrate this fact, this article will compare United Kingdom and Malaysia legislation and regulation and how they match each other. The focus is on banks because although money launderers use many methods to clean their dirty money, the banking system is still a popular way to launder money. The article will look at Part 4 of the Malaysian Anti-Money Laundering and Anti-Terrorism Financing Act 2001 (AMLATFA) and its UK equivalent. It can be seen that despite banks being subject to regulation for at least 20 years, banks in countries such as the United Kingdom are still being given huge fines for not having adequate anti-money laundering procedures.