Terrorism financing and money laundering: two sides of the same coin?

2018 ◽  
Vol 25 (4) ◽  
pp. 962-968 ◽  
Author(s):  
Frederic Compin
Keyword(s):  
Money Laundering ◽  
Tax Evasion ◽  
White Collar Crime ◽  
Islamic State ◽  
Content Type ◽  
Fully Integrated ◽  
Financial Crimes ◽  
Terrorism Financing ◽  
Utilitarian Approach ◽  
The Cost

Purpose The purpose of this paper is to analyse how terrorism financing can be assimilated with money launderning when the amounts ofmoney involved differ so markedly. Not only is the cost of financing terrorist attacks minimal compared to the huge sums often at stake in financial crimes, but also the psychological profile of terrorists, who are reclusive by nature, contrasts starkly with that of financial criminals, who are usually fully integrated members of society. When terrorism financing is equated with money laundering this represents a utilitarian approach in that it facilitates the creation of a security strategy and stifles criticism of criminogenic capitalismthat turns a blind eye to tax evasion. Design/methodology/approach The analysis is conceptual, focussing on the assimilation of terrorism financing with money laundering. There is an interview with a French magistrate, specialized in the fight against corruption and white-collar crime, and data have been collected from international organizations and scholarly articles. Findings The fight against money laundering and money dirtying has clearly sparked numerous controversies around evaluation, scope, criminal perpetrators and a lack of vital cooperation between administrative and judicial services. Social implications This paper raises questions about the reasons behind the linking of money laundering and money dirtying by states and players in public international law and why the fight against money laundering is very much overshadowed by their focus on terrorist financing in dealing with the growing threat of Islamic State, otherwise known as ISIS or ISIL, in the Middle East and West Africa. Originality/value The paper enables the reader to raise the question of similarities between the fight against money laundering and the fight against terrorism financing.

Indonesia toughens fight against Islamic State

2017 ◽  
Keyword(s):  
Money Laundering ◽  
East Asian ◽  
Islamic State ◽  
Security Risk ◽  
Content Type ◽  
Terrorism Financing ◽  
Military Relations

Subject The Islamic State threat in Indonesia. Significance On February 1, Indonesia and Australia announced a joint programme to curtail terrorism financing and money-laundering in Indonesia. The closer cooperation follows a successful anti-Islamic State (IS) crackdown in Indonesia, for which Australia has provided important intelligence. Impacts Australian-Indonesian military relations will be fully restored over coming weeks. Ongoing arrests of IS supporters in Turkey will result in detentions of South-east Asian nationals. Once deported back to their home countries, these returnees will pose a new and serious security risk.

Financial crime, corruption and tax evasion: a cross-country investigation

2018 ◽  
Vol 21 (4) ◽  
pp. 545-554 ◽  
Author(s):  
Ines Amara ◽  
Hichem Khlif
Keyword(s):  
Money Laundering ◽  
Tax Evasion ◽  
Design Methodology ◽  
Positive Relationship ◽  
Policy Implications ◽  
Financial Crime ◽  
Content Type ◽  
Financial Crimes ◽  
Cross Country ◽  
The Relationship

Purpose This paper aims to examine the relationship between the financial crime and tax evasion and tests whether corruption moderates such a relationship. Design/methodology/approach Tax evasion measure is based on Schneider et al. (2010). Financial crime is collected from Basel anti-money laundering (AML) report. Findings Using a sample of 120 countries, the authors find that the level of financial crime is positively associated with tax evasion. When testing for the moderating effect of corruption, they document that the positive relationship between financial crime and tax evasion is more pronounced for high corrupt environments. Originality/value The findings have policy implications for governments aiming to combat tax evasion and financial crimes.

An embezzler test for norms, standards and regulations

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Tiago Cardao-Pito
Keyword(s):  
Money Laundering ◽  
Tax Evasion ◽  
Design Methodology ◽  
Methodological Approach ◽  
Future Research ◽  
Content Type ◽  
Financial Crimes ◽  
Standards And Regulations ◽  
Practical Implications ◽  
Resultant Material

Purpose The purpose of this study is to address the question that economic standards, norms and regulations can possess weak spots that might be exploitable for the embezzlement of an organization’s assets with resultant material consequences in money laundering,tax evasion, fraud, corruption and other potential financial crimes. Design/methodology/approach The author’s methodological approach is to introduce and discuss a new logical-deductive test that the author names “embezzler test”. The author’s test investigates regulatory architectures from the perspective of someone attempting to divert assets from or to an organization. It appraises whether a potential embezzler could divert resources without being detected and sanctioned. Findings The embezzler test can be applied to a broad range of standards, norms and regulations. Research limitations/implications This new test can be improved and further calibrated in future research. Practical implications Researchers, regulators and law makers can use the new test to identify and eventually fix weak spots for embezzlement in norms, standards and regulations. Originality/value To the best of the author’s knowledge, such a test has never been formulated or applied before to identify weak spots for potential embezzlement in regulatory architectures.

Recent trends in money laundering and terrorism financing

2019 ◽  
Vol 27 (1) ◽  
pp. 2-12 ◽  
Author(s):  
Fabian Maximilian Teichmann
Keyword(s):  
Money Laundering ◽  
Financial Services ◽  
White Collar Crime ◽  
Qualitative Content Analysis ◽  
Criminal Activity ◽  
Content Type ◽  
Compliance Officers ◽  
Terrorism Financing ◽  
Prior Literature ◽  
Recent Trends

Purpose This paper aims to investigate how criminals launder money and finance terrorism through the financial system. Design/methodology/approach In total, 70 interviews were conducted with criminals and white-collar crime prevention experts, whose responses were subjected to qualitative content analysis. Based on the findings, a quantitative survey of 200 compliance officers was carried out. Findings The interviews and survey revealed concrete techniques of laundering money and financing terrorism through the financial services industry and its affiliates. Evidently, the compliance mechanisms aimed at preventing money laundering and terrorism financing can be easily circumvented. Research limitations/implications This study’s findings are limited to the perspectives of 70 interviewees. Hence, it is possible that a study with a larger sample conducted in different countries or at a different time could have yielded different results. Practical implications Identifying the concrete methods of laundering money and financing terrorism should provide both compliance officers and legislators with valuable insights into criminal activity. By better understanding the specific steps taken by criminals, compliance officers should be able to more effectively combat both money laundering and terrorism financing. Originality/value While prior literature focuses on the organizations and mechanisms involved in combating money laundering and terrorism financing, this paper instead explores how criminals avoid detection by taking into account existing compliance mechanisms and criminal perspectives.

scholarly journals Money laundering and terrorism financing in virtual environments: a feasibility study

2014 ◽  
Vol 17 (1) ◽  
pp. 50-75 ◽  
Author(s):  
Angela S.M. Irwin ◽  
Jill Slay ◽  
Kim-Kwang Raymond Choo ◽  
Lin Lui
Keyword(s):  
Virtual Environments ◽  
Money Laundering ◽  
Service Providers ◽  
Massively Multiplayer Online Games ◽  
Content Type ◽  
Number Of Factors ◽  
Terrorism Financing ◽  
The Cost ◽  
Level Of Effort ◽  
Research Show

Purpose – There is a clear consensus of opinion that virtual environments and virtual currencies pose a money laundering and terrorism financing threat. What is less clear, however, is the level of risk that they pose. This paper aims to clarify the suitability of virtual environments for conducting money laundering and terrorism financing activities. Design/methodology/approach – A number of experiments were conducted to estimate the quantity of funds that could be moved through these environments. These experiments took into account a number of factors such as the number of accounts that would need to be opened to launder/raise a specific amount of funds, the amount of funds that could be placed within a certain timeframe and the transaction limits imposed by each of the massively multiplayer online games and online financial service providers involved in the money laundering and terrorism financing scenarios. Findings – The findings of this research show that money laundering and terrorism financing can take place inside virtual environments. Virtual money laundering and terrorism financing offer high levels of anonymity, potentially low levels of detection, and remove many of the risks associated with real-world money laundering and terrorism financing activity. However, this comes at the cost of ease, time and, in some cases, the amount of funds laundered. Large sums (millions of dollars) can be laundered in virtual environments, but this exponentially increases the level of effort involved in setting up accounts and placing, layering and integrating funds. Originality/value – A number of authors have described potential virtual money laundering scenarios, but some of these are out-of-date due to closed loopholes, all are rudimentary and make no attempt to discuss the practicality or feasibility of using these scenarios. This research addresses those issues.

Criminals move with the times

2014 ◽  
Vol 30 (6) ◽  
pp. 8-10
Keyword(s):  
Virtual Environments ◽  
Money Laundering ◽  
Content Type ◽  
Terrorism Financing ◽  
Pertinent Information ◽  
The Times ◽  
The Cost ◽  
Level Of Effort ◽  
Practical Implications ◽  
Research Show

Purpose – This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies. Design/methodology/approach – This briefing is prepared by an independent writer who adds his own impartial comments and places the articles in context. Findings – The findings of this research show that money laundering and terrorism financing can take place inside virtual environments. Virtual money laundering and terrorism financing offer high levels of anonymity and potentially low levels of detection, and remove many of the risks associated with real-world money laundering and terrorism financing activity. However, this comes at the cost of ease, time and, in some cases, the amount of funds laundered. Large sums (millions of dollars) can be laundered in virtual environments, but this exponentially increases the level of effort involved in setting up accounts and placing, layering and integrating funds. Practical implications – The paper provides strategic insights and practical thinking that have influenced some of the world’s leading organizations. Originality/value – The briefing saves busy executives and researchers’ hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and an easy-to digest format.

The Legal Combat of Financial Crimes: A Comparative Assessment of the Enforcement Regimes in Nigeria and South Africa

2020 ◽  
pp. 1-23
Author(s):  
Nelson Ojukwu-Ogba> ◽  
Patrick C Osode
Keyword(s):  
South Africa ◽  
Money Laundering ◽  
Tax Evasion ◽  
Task Force ◽  
Effective Control ◽  
Market Manipulation ◽  
Economic Implications ◽  
System Integrity ◽  
Financial Crimes ◽  
Terrorism Financing

Abstract Financial crimes are debilitating problems for economies, especially emerging ones. The scourge of financial crimes includes money laundering, fraud, drug and human trafficking, terrorism financing, bribery, embezzlement, market manipulation, tax evasion, identity theft, forgery and cybercrime. These problems are so intractable and potentially destructive that the collective effort to prevent or contain them has gone global. The imperative of enhanced transparency and financial system integrity, not only in national financial systems but also in the international financial order, has become inevitable. This has resulted in the landmark frameworks of the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances and the G7’s Financial Action Task Force. This paper discusses the legal combat of financial crimes in two major African economies: Nigeria and South Africa, with particular emphasis on money laundering and terrorism financing due to their direct negative macro-economic implications for any economy. The focus on the twin problems in those two economies is based on their pre-eminent position in Africa. The paper examines the legal frameworks for the prevention or containment of the scourge in the two countries and interrogates measures that could engender their effective control.

scholarly journals Legal, Administrative and Judicial Framework in Pakistan to Combat Tax Evasion and Money Laundering: An Analytical Study

2021 ◽  
Vol 3 (1) ◽  
pp. 69-77
Author(s):  
Aamir Khan ◽  
Naureen Akhtar
Keyword(s):  
Money Laundering ◽  
Tax Evasion ◽  
Analytical Study ◽  
Research Paper ◽  
Tax Administration ◽  
Financial Instability ◽  
Money Launder ◽  
Financial Crimes ◽  
Narcotics Trafficking ◽  
Terrorism Financing

Purpose: The main objective of this research paper is to look at Pakistan's legal, administrative, and judicial framework in terms of countering money laundering and tax evasion. Money laundering and tax evasion are two financial crimes that have been linked, either directly or indirectly, to one other. Money laundering was formerly solely associated with the crimes of narcotics trafficking and terrorism financing. At present, it has been also associated with tax evasion. Methodology: The framework regarding tax evasion and money laundering is varied. In Pakistan, two different mechanisms exist to combat both crimes. This article analytically studies the parliamentary statutes and ordinance, the working of investigating and prosecuting agencies and judicature structure concerning tax evasion and money laundering in Pakistan. Findings: This article concludes that the problem of tax evasion and money launder are causing financial instability in Pakistan. There is an urgent need of revamping the current tax administration to detect tax evasion and frauds. Implication: this article recommends potential reforms in the existing legal, administrative and judicial framework to control and curb both crimes more effectively.

An analysis of the forfeiture regime under the anti-money laundering law

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Aspalella A. Rahman
Keyword(s):  
Money Laundering ◽  
Secondary Data ◽  
Primary Sources ◽  
Court Cases ◽  
Sources Of Information ◽  
Content Type ◽  
Terrorism Financing ◽  
Bona Fide ◽  
Descriptive Approach ◽  
Insight Into

Purpose This paper aims to analyze the forfeiture regime under the Malaysian anti-money laundering law. Apart from discussing the relevant provisions, several court cases also were examined to identify the problems which arise in the implementation of such a powerful forfeiture regime. Design/methodology/approach This 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 used analytical descriptive approach to analyze relevant forfeiture provisions from statutes and to examine current court cases regarding the implementation of the forfeiture regime. Findings The Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act (AMLATFPUAA) provides comprehensive procedures for the forfeiture of criminal proceeds. Any limitations of the previous statutory legislations have been addressed, and more importantly, the AMLATFPUAA introduces more powerful and innovative measures that can facilitate the recovery of illegal proceeds from money laundering and any other serious crimes. The AMLATFPUAA also provides avenue for the bona fide third parties to contest the forfeiture order. However, it appears that such right is not easy to be enforced. Originality/value This paper provides an analysis of the forfeiture regime under Malaysian anti-money laundering laws. It is hoped that the content of this paper can provide some insight into this particular area for enforcement authorities, practitioners, academics, policymakers and legal advisers not only in Malaysia but also elsewhere. The findings of this paper also expose any weakness or lacunae in the aspects of application and implementation of the forfeiture regime. Thus, more effective and workable legal solution especially on the issue of civil forfeiture of criminal assets could be considered for further accomplishment.

Tax evasion and money laundering: a complete framework

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Deen Kemsley ◽  
Sean A. Kemsley ◽  
Frank T. Morgan
Keyword(s):  
Money Laundering ◽  
Tax Evasion ◽  
Task Force ◽  
Regulatory Agencies ◽  
Content Type ◽  
Single Process ◽  
Financial Action Task ◽  
Tax Savings ◽  
Practical Implications ◽  
Complete Framework

Purpose This paper aims to define the fundamental nexus between income tax evasion and money laundering. The G7 Financial Action Task Force (FATF) designates tax evasion as a predicate offense for money laundering. We determine whether this designation is complete from a conceptual standpoint, or whether there is a stronger connection between tax evasion and money laundering. Design/methodology/approach This paper applies the FATF definition for money laundering – as well as generally accepted definitions for tax evasion and for a standard predicate offense – to identify the necessary conditions for each crime. This paper then uses these conditions to test opposing hypotheses regarding the nexus between tax evasion and money laundering. Findings This paper demonstrates that tax evasion does not meet the conditions for a standard predicate offense, and treating it as if it were a standard predicate could be problematic in practice. Instead, it is concluded that the FATF’s predicate label for tax evasion, together with tax evasion methods and objectives, imply that all tax evasion constitutes money laundering. In a single process, tax evasion generates both criminal tax savings and launders those criminal proceeds by concealing or disguising their unlawful origin. Practical implications The FATF could strengthen its framework by explicitly defining all tax evasion as money laundering. This would enable regulatory agencies to draw upon the full combined resources dedicated to either offense. Originality/value The analysis demonstrates that tax evasion completely incorporates money laundering as currently defined by the FATF.

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