Anti-money Laundering Regime Research Articles

Правовое регулирование криминализации отмывания денежных средств, полученных преступным путем, в Европейском Союзе: современные тенденции

Countering the legalization (laundering) of proceeds from crime is one of the key priorities of the EU Security Union Strategy. Taking into account the development of European integration and the emergence of new criminal threats, there has been an intensive reform of the regulatory framework of the European Union in the area of preventing and combating money laundering and terrorist financing. The criminalization of money laundering is considered to be a central component of the anti-money laundering regime. The article analyzes the stages of development of the legal framework for combating the legalization (laundering) of money in the European Union. There are considered the modern trends of criminal law regulation in this area. The features of the criminalization of money laundering in the European Union law are revealed.

Legal support of anti-money laundering and terrorism financing regime in the conditions of new technologies integration

The article studies the development of legal regulation in correlation with the processes of integration of digital technologies in the regime of combating money laundering, financing terrorism and weapons of mass destruction. The research attempts to establish the stage of modern law development in terms of regulating the use of new technologies by the private sector and state bodies. The goal is to study regulatory legal acts and legal practice in the Russian Federation and other countries. The standard legislative initiatives of states in the field of regulation of new technologies, as well as other related legal spheres have been analyzed. The rearch notes the lack of a unified systematic legal basis for the use of technologies such as artificial intelligence, cryptocurrency, and national digital currencies of banks. It has been concluded that there is a high risk of using new digital technologies without modernizing state equipment and improving the regulatory system base for their application. Recommendations are proposed for further development of the database in terms of introduction of digital technologies. A number of conclusions concerning necessitating changes in preparation of legislation on new technologies integration have been made.

Regulated sector professionals and reporting suspicion of money laundering: is it a disproportionate burden?

PurposeThe purpose of the research paper is to determine the efficiency of all crimes approach, their relationship with a risk-based approach and the consequences on regulated sector professionals. And, therefore, what is meant by suspicion, how employees follow the requirements and how it affects the quality and quantity of suspicious activity reports. It also considers the economic and legal challenges the regulated sector faces while dealing with customers or clients. All in all, this paper investigates what does the anti-money laundering (AML) regime means for legal practice and how lawyers’ responsibility is affected.Design/methodology/approachAs the research is being conducted through the analytical methodology, the specific topic of “regulated sector professionals and reporting suspicion of money laundering” is analyzed. It evaluates the fact that the risk-based approach followed in Financial Action Task Force (FATF) recommendations and its adaptation in the UK with all crimes approach caused discrepancy in the judicial system and influenced regulated sector professionals negatively.FindingsThe paper points out that in spite of protective amendments in terms of jurisdictional immunity, UK legislation has caused problems for regulated sector professionals, such as the potential of breaching a client confidentiality agreement and avoiding tipping-off, thus remaining under pressure by clients and facing the risk of losing their clients or obligation to record suspicions in case of court investigation.Originality/valueThe question of money laundering and the FATF recommendations has had a considerable scholarship. However, the proposed study intends to precisely look at the efficiency of all crime approaches, their relationship with a risk-based approach and the consequences on regulated sector professionals. The proposed research will further determine the regulated sector’s economic and legal challenges while dealing with customers or clients. Unlike the existing scholarship, the proposed thesis will focus on what the AML regime means for legal practice and how lawyers’ responsibility is affected.

The Effectiveness of Maldives’ Financial Intelligence Unit in Combating Money Laundering

Money laundering has become a vast global concern, and the rates are growing. Hence, there is a need for a good preventive and monitoring mechanism that monitors suspicious transactions at the source. In Maldives, a Financial Intelligence Unit (FIU) was introduced to gather, analyse, and provide financial intelligence report to law enforcement agencies to proceed with an investigation. The FIU plays a vital role in the Anti-Money Laundering (AML) Regime in successfully combat money laundering activities. Since the AML Regime in Maldives was established in 2014, there is a need to conduct a study to investigate the effectiveness of the FIU in combating money laundering in the Maldives. Based on questionnaires collected from 122 enforcement officers, findings show that reporting mechanisms significantly influence the effectiveness of the FIU. The legal framework and the role of the officer did not significantly influence the effectiveness of FIU. It shows that the competency of LEAs in combating money laundering in the Maldives is still low. Therefore, the government needs to enhance the awareness and competencies of enforcement officers in combating money laundering. Future research may conduct a comparative study to understand further the best reporting mechanism that can help enhance the effectiveness of law enforcement agencies. Keywords: financial intelligence unit, money laundering, reporting mechanism

Implementasi Upaya Pemulihan Aset Korban Kejahatan Tindak Pidana Penipuan dan Pencucian Uang Dalam Kasus First Travel

Assets resulting from criminal acts are the purpose of carrying out criminal acts with economic motives and thus eliminating access and rights of perpetrators to the proceeds of crime and their acquisition can be an effective way of eradicating economic-motivated criminal acts. The anti-money laundering regime in Indonesia has given birth to a new approach that is no longer focused on the perpetrators of crime but on the assets resulting from their crimes, known as the follow the money method. In addition, the law enforcement instruments against illegal assets contained in the Money Laundering Law are actually sufficient to achieve not only assets resulting from criminal acts but also to their acquisition. Ideally, the assets resulting from the crime are returned to the victims of the crime through a court decision with permanent legal force ordering the seizure of assets for the state or returning them to those who are entitled. However, this cannot be seen from First Travel's decision which sentenced the Defendants to imprisonment and confiscated First Travel's assets for the state, which did not immediately solve the problem because this decision did not reach out to the recovery of the impact of the crime experienced by the actual victim.

Implementasi Upaya Pemulihan Aset Korban Kejahatan Tindak Pidana Penipuan dan Pencucian Uang Dalam Kasus First Travel

Assets resulting from criminal acts are the purpose of carrying out criminal acts with economic motives and thus eliminating access and rights of perpetrators to the proceeds of crime and their acquisition can be an effective way of eradicating economic-motivated criminal acts. The anti-money laundering regime in Indonesia has given birth to a new approach that is no longer focused on the perpetrators of crime but on the assets resulting from their crimes, known as the follow the money method. In addition, the law enforcement instruments against illegal assets contained in the Money Laundering Law are actually sufficient to achieve not only assets resulting from criminal acts but also to their acquisition. Ideally, the assets resulting from the crime are returned to the victims of the crime through a court decision with permanent legal force ordering the seizure of assets for the state or returning them to those who are entitled. However, this cannot be seen from First Travel's decision which sentenced the Defendants to imprisonment and confiscated First Travel's assets for the state, which did not immediately solve the problem because this decision did not reach out to the recovery of the impact of the crime experienced by the actual victim.

Institutionalizing the fight against money laundering in Tanzania: the potential, limitations and challenges

PurposeThis paper aims to examine the authorities tasked to fight against money laundering in Tanzania and appraise the efficacy of the country’s anti-money institutional framework to tackle the problem.Design/methodology/approachThe paper draws on a qualitative research and data generated from the analysis of documentary materials. It surveys the anti-money laundering (AML) law in Tanzania to describe the legal and institutional frameworks for tackling money laundering. It explores law-related and non-law aspects to interrogate and appraise the efficacy of Tanzania’s AML law and authorities. The qualitative data were generated using the thematic content analysis technique.FindingsThe law in Tanzania establishes authorities and vests them with powers to combat money laundering. The authorities, which are part of Tanzania’s AML institutional framework, have been instrumental in combating money laundering. Nevertheless, several law-related and non-law factors emasculate the efficacy of the AML law and authorities in Tanzania. Some political and economic factors wear off the effectiveness of the country’s AML institutional framework. The transnational nature and complexity of money laundering overwhelm the capacity of the AML authorities in Tanzania.Practical implicationsThe paper provides useful insights on money laundering and the legal regime to counteract the scourge in Tanzania which sets up the country’s AML institutional framework. It raises some issues for researchers, policymakers and law enforcers who can re-examine the problem and revisit the law and re-evaluate authorities and propose measures that will enable the government to reinforce the country’s AML regime. The paper makes a case for the government to implement the reforms of the country’s AML policy, legal and institutional frameworks.Originality/valueThe paper investigates issues relating to money laundering and its control in Tanzania beyond the legal perspective to uncover limitations and challenges that emasculate the efficacy of the AML authorities in the Tanzanian context. The issues examined in this paper are not unique to Tanzania and, hence, have relevance to other jurisdictions in sub-Saharan Africa.

Anti-money laundering regimes: a comparison between Germany, Switzerland and the UK with a focus on the crypto business

PurposeThis paper aims to examine the framework for the regulation of crypto assets in Germany, the UK and Switzerland focusing on anti-money laundering (AML) laws. It comprehensively addresses the risks of crypto assets and the benefits along with the changes made to the existing laws to regulate cryptocurrency.Design/methodology/approachQualitative data was analyzed to collect information for the case study and to challenge/examine the existing data and statistics.FindingsThe findings suggested that the AML laws are additionally modified to include the cryptocurrencies violations of the legislation, as it is the decentralized financial systems generating opportunities for crimes and terror financing. The moderate or mild laws were found in Switzerland following Germany and the UK has the most traditional and stringent laws of money laundering.Originality/valueThe paper has focused on the comparison of the three states in their AML laws comprehensively along with their attitude toward the crypto businesses.

Anti-money laundering in the United Kingdom: new directions for a more effective regime

PurposeThis paper aims to provide a more nuanced understanding of the effectiveness of the anti-money laundering (AML) regime in the UK and explore opportunities to improve policy and performance.Design/methodology/approachQualitative research design using semi-structured interviews and a focus group with practitioners from both public and private sectors.FindingsThis paper identifies preventive measures are underfunded by the public sector; there is a disconnect between the regulatory requirement and the regulators’ supervisory approach leading to the ineffective application of the risk-based approach; and authorities have limited ability to stop low-utility reports. Increased collaboration across institutions and sectors, better utilisation of innovative technologies and a sustainable funding plan are needed to drive a collective response to money laundering.Research limitations/implicationsFew practitioners in the industry have the knowledge and expertise to discuss the topic at a strategic level and participants were limited (n = 8).Practical implicationsThis paper adds to the growing corpus of research showing that the AML regime in the UK is ineffective and needs reform.Social implicationsThis paper encourages practitioners to improve the AML regime, this research contributes to the reform of the existing measures against financial crime.Originality/valueThis paper presents new data from AML practitioners to provide a better understanding of the limitations of the AML regime in the UK.

The concept of money laundering: a quest for legal definition

Purpose This paper aims to focus on the concept of money laundering and explores the evolution and expansion of criminalization of predicate offences to the money laundering within the international anti-money laundering (AML) regime over the time. It proposes how to limit the size and scope of predicate offences in designing a balanced legal definition. Design/methodology/approach This paper opted a content analysis focussed on the criminalization aspect of offences to money laundering in the international AML regime under the United Nations Conventions (Vienna, Palermo and Corruption Convention) and Financial Action Task Force Standards. Findings This paper provides how the criminalization of money laundering has evolved and its definition expanded over the time. The international definition is widely drafted with wide range of predicate offences from proceeds of drug money to corruption, including terrorist financing and terrorist acts; however, the two phenomena – money laundering and terrorist financing are quiet distinct apart. This continual expansion of predicate offences quite leads legality issues such as over-criminalization and conflict with principles of criminal law. This paper suggests an approach to limit the size and scope of predicate offences to money laundering. Practical implications This paper includes implications for the development of a balanced approach in defining predicate offences through a qualitative limitation approach consistent with the minimalist theory of penalization of criminal law. Originality/value This paper attains an identified issue how the legal definition of the money laundering offence can be improved while considering rule of law and principles of criminal law concerns.

Money laundering and terror financing: issues and challenges in Pakistan

PurposePakistan is facing the momentous hazard of money laundering and a substantial risk of terror financing, which are seriously threatening its socioeconomic well-being. The purpose of this paper is to gauge the challenges posed by these threats in contrast with the existing potential and expertise of legal entities. It also examines legal and procedural measures enforced as a counter-strategy for terror financing and money laundering and the AMLA 2010 and National Action Plan (NAP) for countering terrorism financing.Design/methodology/approachThis paper uses an analytical and comparative method using figures and comparative data on the success of the NAP and AMLA 2010 as national counterterrorism strategies. Terror financing and anti-money laundering regimes are confronted with grave legal and procedural odds, noncooperation and performance issues and conflicts of interest on the part of the enforcers/politicians. This paper highlights the issues that seriously jeopardize strategies to stop money laundering and terror financing, such as geography, informal financial transfers and exchange systems, un-regulated charities and real estate sectors, the modest performance of enforcement agencies and lukewarm political support for the NAP.FindingsThe situation requires the improvement of weak legislation and poor coordination and the adaptation of technological advancements and novel counter-strategies, along with properly trained enforcement personnel.Originality/valueThis paper will prove to be a valuable reference for exploring the shortcomings and insights. This will provide useful information for legal and financial practitioners, academicians, research scholars, policymakers and journalists.

Memerangi Kejahatan Kehutanan dan Mendorong Prinsip Kehati-hatian Perbankan untuk Mewujudkan Pengelolaan Hutan yang Berkelanjutan Pendekatan Anti Pencucian Uang

If the illegal logging is just a criminal whose involve the poor society which their life depend to the forest, truck driver or forest guards whose underpaid, that criminal would not be difficult to stop. With the involvement of support from the illegal logging funders, which usually called cukong, illegal logging industry and government employees, the illegal logging has become a complex problem, not only in Indonesia, but also for the international forest community. The forestry law enforcement approach which now is running failed to capture the mastermind of illegal logging. But, the money laundering law enforcement approach which with the approach in “follow the money” may be the option to face the actors in illegal logging. This approach requires the bank and the other financial service providers for more active and careful in run the financial transaction whose related to their customers. Bank customers may be the funders of illegal logging, wood industry, law enforcement instrument and government instrument. Overall, the use of anti-money laundering regime effectively will give the opportunies to encourage the banking precautionary principles and the forest management, and to reduce the forest criminal.

Anti-money laundering obligations and dismissal of bankers: evidence from Malaysia

PurposeThis paper aims to analyse the anti-money laundering (AML) obligations imposed on bankers as the main reporting entities under the AML regime in Malaysia. Apart from discussing the relevant provisions, several court cases were also examined to identify the problems which arise in the implementation of the law and the risk of dismissal that bankers may face.Design/methodology/approachThis paper mainly relies on statutes and court cases as its primary sources of information. It is supported by secondary data to justify the analysis. This paper also uses an analytical descriptive approach to analyse relevant provisions from statutes and to examine current court cases regarding the implementation of the AML obligations on bankers.FindingsIt is submitted that the AML legislation imposes a significant burden of reporting requirements on the bankers, failure of which may justify the dismissal or termination of their services. In other words, the law has not only altered the way bankers deal with their customers but also poses substantial legal risks to their security of tenure. Indeed, getting the right balance between the need to combat money laundering and the interests of bankers is a difficult exercise.Originality/valueThis paper provides an analysis of the liability of bankers under Malaysian AML laws. It is hoped that the content of this paper can provide some insight into this particular area for bankers, enforcement authorities, practitioners, academics, policymakers and legal advisers, not only in Malaysia but also elsewhere. The findings of this paper also highlight the risks that bankers may face for non-compliance with the reporting obligations under the AML laws.

The anti‐money laundering and counter financing of terrorism policy in Pakistan: Is it truly combating or just a high‐level desk work bureaucracy?

To combat money laundering (ML)/terrorist financing (TF), Pakistan has joined the Asia Pacific Group in May 2000. Pakistan has ratified and adopted twenty United Nations conventions and resolutions on organized and related crimes. However, these efforts were futile due to deficient legislation and insubstantial implementation caused by a lack of political commitment and will. Although a multi‐agency approach for investigation and enforcement is in place to fight against ML/TF, the geographical location and variety of Pakistan's borders are natural obstacles in implementing a sustainable anti‐money laundering (AML)/counter financing of terrorism regime. Further, the mutual evaluation report stated that Anti‐money Laundering Act (AMLA) 2010's development demonstrates many inconsistencies and deficiencies, resulting in a feeble AML regime. FTAF has endorsed flaws in AMLA and related laws pointed by APG. Pakistan has convicted only one launderer on the implementation front, and assets confiscation is also negligible under AMLA. Moreover, without clarity and harmonization in AMLA, Pakistan finds it difficult to secure a stable position in financial action task force (FATF).

The anti-money laundering act of 2020

Purpose The purpose of this article is to inform stakeholders about the Anti-Money Laundering Act of 2020 (AMLA), explain its impact on the U.S. anti-money laundering (AML) regime, and highlight critical updates for financial institutions. Design/methodology/approach The article provides an overview of the AMLA, and specifically addresses three key components: (1) the development of uniform beneficial ownership requirements and the creation of a beneficial ownership registry at the Financial Crimes Enforcement Network (FinCEN); (2) the expansion of FinCEN’s powers and the Bank Secrecy Act/AML program requirements; and (3) new subpoena powers with potential extraterritorial effect granted to the U.S. Secretary of the Treasury and the U.S. Attorney General for documents located at foreign banks that have a correspondent banking account in the U.S. The article also notes the purpose and goals of the AMLA. Findings The AMLA is the first major overhaul of the U.S. AML regime since the 2001 USA PATRIOT Act, and is designed to strengthen national security, protect the financial system, and simplify compliance obligations. The beneficial ownership reporting requirements represent an effort to combat illicit financial activity conducted by shell companies formed and registered in the U.S. Originality/value The article provides financial institutions with a brief overview of a lengthy new law that will impact their AML compliance obligations. Financial institutions should be on alert for forthcoming regulations.

The Urgency to Prevent Illicit Political Party Fundraising Through the Anti-Money Laundering Regime in Indonesia


 
 
 An election is a democratic process, which is both costly and cumbersome for anyone who wishes to participate. Existing practices, precisely in Indonesia, show that both political parties as well as candidates often need to raise funds to finance their campaign and/or their programs, as well as to ensure the sustainability of their political parties. The Indonesian law states various financial resources in which a political party can raise. Nevertheless, it does not set the limitations and restrictions, particularly on ways to identify and monitor where funds come from. Hence, there has been a fear that political parties may use this loophole to conduct money laundering. It is argued that while the money laundry regime can be used to prevent conspicuous practices related to political financing, a legal framework has yet to be designed and implemented.
 
 

An exploration of the current regulatory aspects of money laundering in South Africa

Purpose Money laundering activities were allegedly rampant and poorly regulated in the South African financial markets and financial institutions prior to 1998. In other words, prior to the enactment of the Prevention of Organised Crime Act 121 of 1998 as amended (POCA), there was no statute that expressly and adequately provided for the regulation of money laundering in South Africa. Consequently, the POCA was enacted to curb organised criminal activities such as money laundering in South Africa. Thereafter, the Financial Intelligence Centre Act 38 of 2001 as amended (FICA) was enacted in a bid to, inter alia, enhance financial regulation and the combating of money laundering in the South African financial institutions and financial markets. Design/methodology/approach The paper provides an overview analysis of the current legislation regulating money laundering in South Africa. In this regard, prohibited offences and measures that are used to curb money laundering under each relevant statute are discussed. The paper further discusses the regulation and use of customer due diligence measures to combat money laundering activities in South Africa. Accordingly, the regulation of customer due diligence under the FICA and the Banks Act 94 of 1990 as amended (Banks Act) is provided. Findings It is hoped that policymakers and other relevant persons will use the recommendations provided in the paper to enhance the curbing of money laundering in South Africa. Research limitations/implications The paper does not provide empirical research. Practical implications The paper is useful to all policymakers, lawyers, law students, regulatory bodies, especially, in South Africa. Social implications The paper seeks to curb money laundering in the economy and society at large, especially in the South African financial markets. Originality/value The paper is original research on the South African anti-money laundering regime.

Anti-money Laundering Awareness and Acceptance among the Banking Customers of Nepal

Background: Money laundering is a process of converting illegal money into legal money. This process is considered a challenging phenomenon for the financial system. To stop this exploitation of the financial system, anti-money laundering (AML) regimes are formulated. However, the general public acceptance is crucial to make the framework viable. Public awareness of Anti-money Laundering (AML related factors helps people enforce the AML regimes properly.
 Objective: The paper aims to examine the relationship between awareness of AMLrelated factorsand acceptance ofAMLregimes. Along with that, the study accessesthe level of awareness and level of acceptance among bank clients about AML factors and AML regimes respectively.
 Methods: Based on descriptive and inferential research designs, the study made use of primary data collected through a structured questionnaire surveyed on 168 bank customers who are of 18 years and above, using a convenience sampling technique. Descriptive analysis is used to access the level of awareness and acceptance, whereas the relationship between awareness and acceptance is examined through correlation and regression analysis.
 Results: Bank customers are moderately aware of money laundering (ML) andterrorism financing (TF), and anti-money laundering (AML)along with Know Your Customer (KYC).However, they are somewhat and slightly aware of AML investigation agency and AML legislation respectively. Similarly, they have a slightacceptance attitude towards all AML regimes. There is a significantlypositive relationship between awareness of AML related factors and acceptance for AML regimes.
 Conclusions: Bank customers of Nepal have a comparatively higher awareness of ML, TF, AML and KYC than that of AML legislation and AML investigating agency. However, they have a similar acceptance attitude towards all three AML regimes. Acceptance for AML regimes can be increased by enhancing the awareness of AML related factors among the bank customers. The study, therefore, recommends the concerned authority like FIU-Nepal and NRB to undertake public awareness campaigns in related areas.
 Implication: Study findings can be useful to policymakers and concerned authorities to formulate positive national policies sensitive to AML.

How Trinidad and Tobago's Anti-Money Laundering Framework Affects Its Commercial Operations

A paper interrogating the direct and indirect effect of Trinidad and Tobago's anti-money laundering regime on its commercial banking operations and the resulting tension between the bank's civil duties and obligations to its customers and the public duty imposed by anti-laundering legislative frameworks to stop money laundering. The paper also considers the strategic deficiencies within Trinbago's anti-laundering regime.

Money Laundering in a Developing Country and a Developed One: Iran Versus the UK

Purpose – This paper compares and contrasts the main reasons of money laundering, sources of dirty funds, and destinations of laundered monies in Iran and the UK. It also aims to study the accounting profession related part of Iran’s and the UK’s Anti-Money Laundering (AML) regime. Design/Methodology/Approach– The questionnaires were sent to Iranian certified public accountants and the UK’s chartered accountants who are qualified at the beginning of 2020. Findings – The findings show that the government and politicians are the primary reason and also source of money laundering in Iran. However, the main sources of dirty funds in the UK are companies and drugs money. The main destinations of laundered funds in Iran and the UK are foreign countries, real estate markets, and luxury goods markets. We also concluded that while there is a proper AML regime for accounting professionals in the UK, there is not such an AML regime for Iranian accounting professionals. Originality/value – In this research, we have compared and contrasted money laundering environment and AML regime of a high-risk country with a low-risk country. This study can be helpful to diagnose money laundering in Iran in order to improve its AML regime.