Table of Contents

Research Handbook on Money Laundering

Research Handbook on Money Laundering

Elgar original reference

Edited by Brigitte Unger and Daan van der Linde

Although the practice of disguising the illicit origins of money dates back thousands of years, the concept of money laundering as a multidisciplinary topic with social, economic, political and regulatory implications has only gained prominence since the 1980s. This groundbreaking volume offers original, state-of-the-art research on the current money laundering debate and provides insightful predictions and recommendations for future developments in the field.

Chapter 10: Why do some states tolerate money laundering? On the competition for illegal money

Killian J. McCarthy

Subjects: economics and finance, economic crime and corruption, law - academic, corruption and economic crime, politics and public policy, terrorism and security

Extract

Money laundering is the lifeline of the criminal industry. It is the mechanism through which criminals and criminal organisations ‘conceal or disguise the nature, location, source, ownership or control’ of their ill-gotten gains, so as to make it possible to investor to consume the proceeds of crime (Gnutzmann et al. 2010). As such, it would seem to be self-evident that every country would want to tackle money laundering. Even more so when the existence of a money laundering market is said to de stabilise the legitimate economy, and to act as a multiplier for crime, corruption, bribery and terrorism. The costs of money laundering, in fact, are so significant that European legislators have suggested the money laundering market threatens to ‘shake the very foundations of society’ (Directive 2005/60/ EC). It is perhaps surprising, therefore, to learn that the enthusiasm with which national governments apply international anti-money laundering policies (hereafter AML) varies significantly from country to country.

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