Quantitative parameters of anti-money laundering regulation

2021 ◽  
Vol 14 (1) ◽  
pp. 21-43
Author(s):  
Nataliya Yu. TANYUSHCHEVA
Keyword(s):  
Money Laundering ◽  
Systems Approach ◽  
Financial Sector ◽  
Control Measures ◽  
Automated Control ◽  
Macroeconomic Indicators ◽  
Cash Transaction ◽  
Per Capita ◽  
Cis Countries ◽  
The Impact

Subject. As financial institutions carry out a huge number of transactions, the financial sector definitely needs to automate some control procedures, including anti-money laundering ones. The effectiveness of automated control measures directly depends on how adequately tasks for the software are written. The article examines the impact of macroeconomic indicators, such as GDP per capita, average wage, and the scale of the shadow economy in the G20 countries and in two of the CIS countries (Belarus and Tajikistan) on thresholds of the fixed limit of transaction (FLT), which is regulated with the anti-money laundering legislation, including the fixed limit of cash transaction (FLCT). Objectives. I investigate approaches to setting FLT (FLCT) in different countries and formulate my opinion on this issue. Methods. The methodological basis of the study was made up of empirical and logical constructions, statistical analysis, synthesis, systems approach. Results. I identified why FLT (FLCT) are denied. This happens due to lawmakers’ confidence in the effectively controlled financial sector, or the corruption pressure. The countries with FLT (FLCT) introduce and use them formally. The article presents the risk-based approach to measuring the FLCT based on the macroeconomic indicators (average annual wages, savings per capita). Conclusions and Relevance. The case of Russia shows that the inflation undermines the barrier function of FLT (FLCT), while the analytical division of financial intelligence has to handle more issues. The proposed approach will help reduce costs the financial system incurs to process financial information in order to counter money laundering.

scholarly journals Quantitative parameters of anti-money laundering regulation

2020 ◽  
Vol 25 (4) ◽  
pp. 416-429
Author(s):  
N.Yu. Tanyushcheva
Keyword(s):  
Money Laundering ◽  
Systems Approach ◽  
Financial Sector ◽  
Control Measures ◽  
Automated Control ◽  
Macroeconomic Indicators ◽  
Cash Transaction ◽  
Per Capita ◽  
Cis Countries ◽  
The Impact

Subject. As financial institutions carry out a huge number of transactions, the financial sector definitely needs to automate some control procedures, including anti-money laundering ones. The effectiveness of automated control measures directly depends on how adequately tasks for the software are written. The article examines the impact of macroeconomic indicators, such as GDP per capita, average wage, and the scale of the shadow economy in the G20 countries and in two of the CIS countries (Belarus and Tajikistan) on thresholds of the fixed limit of transaction (FLT), which is regulated with the anti-money laundering legislation, including the fixed limit of cash transaction (FLCT). Objectives. I investigate approaches to setting FLT (FLCT) in different countries and formulate my opinion on this issue. Methods. The methodological basis of the study was made up of empirical and logical constructions, statistical analysis, synthesis, systems approach. Results. I identified why FLT (FLCT) are denied. This happens due to lawmakers' confidence in the effectively controlled financial sector, or the corruption pressure. The countries with FLT (FLCT) introduce and use them formally. The article presents the risk-based approach to measuring the FLCT based on the macroeconomic indicators (average annual wages, savings per capita). Conclusions and Relevance. The case of Russia shows that the inflation undermines the barrier function of FLT (FLCT), while the analytical division of financial intelligence has to handle more issues. The proposed approach will help reduce costs the financial system incurs to process financial information in order to counter money laundering.

Anti-money laundering – the need for intelligence

2017 ◽  
Vol 24 (3) ◽  
pp. 472-479 ◽  
Author(s):  
Richard John Lowe
Keyword(s):  
Money Laundering ◽  
Organized Crime ◽  
Financial Services ◽  
National Level ◽  
Financial Sector ◽  
International Standards ◽  
Policy Makers ◽  
Content Type ◽  
The Military ◽  
The Impact

Purpose The purpose of this paper is to highlight the need for predictive intelligence to support anti-money laundering programs in the financial sector. Design/methodology/approach The methodology adopted herein consists of a literature review on the use of intelligence in anti-money laundering, the sources of intelligence and information used in the financial sector, supported by experience gained from investigating and prosecuting money laundering cases, and the assistance provided to financial services companies. Findings Banks and other regulated services are required to meet international standards to deny services to criminals and terrorists, identify suspicious activity and report to the authorities. Regulated businesses have large operations which check customers against sources that confirm their identity or against lists of proscribed or suspected offenders at an individual or national level. Their controls tend to look backwards when other organisations that rely on intelligence, such as the military, value predictive, forward-looking intelligence. The penalties that banks and others face for failure in their controls are increasingly severe, as looking backwards and not forwards reduces the extent to which the controls meet their purpose of reducing the impact of organized crime and terrorism. Originality/value This paper serves as a useful guide to alert and educate anti-money laundering professionals, law enforcement and policy makers of the importance of predictive intelligence in countering organized crime and terrorism. It also considers whether lessons in intelligence handling from other areas can inform a debate on how intelligence can be developed to counter money laundering.

scholarly journals Impact of Forensic Accounting on Financial Fraud Detection in Deposit Money Banks in Nigeria

2021 ◽  
Vol 4 (3) ◽  
pp. 74-119
Author(s):  
Edward Idemudia Agboare
Keyword(s):  
Fraud Detection ◽  
Control Measures ◽  
Primary Data ◽  
Financial Fraud ◽  
Biometric Authentication ◽  
Automated Control ◽  
Fraud Risk ◽  
Forensic Accounting ◽  
Financial Transactions ◽  
The Impact

The study examines the impact of forensic accounting on financial fraud detection in Deposit Money Banks (DMBs) in Nigeria. Survey research design was employed for the study with extensive reliance on primary data obtained through the use of structured Likert scale questionnaire. The data were tested using descriptive statistics and regression analysis on Statistical Package for Social Sciences (SPSS version 20.0). The study findings showed that forensic accounting techniques of conducting investigation, analyzing financial transactions and reconstructing incomplete accounting records have significant effect on financial fraud detection in deposit money banks in Nigeria. In the light of the study findings, the following recommendations were provided; more forensic accountants should be employed by DMBs in Nigeria to assist curb modern day financial fraud brought about by advancement in technology. The Central Bank of Nigeria (CBN) should in collaboration with all financial institutions establish an electronic fraud risk information center staffed with forensic accountants. DMBs should incorporate automated control measures such as biometric authentication of transactions to serve as deterrent for fraud occurring.

scholarly journals Does Financial Development Lead to Poverty Reduction in China? Time Series Evidence

2017 ◽  
Vol 9 (1) ◽  
pp. 99 ◽  
Author(s):  
Sin-Yu Ho ◽  
Bernard Njindan Iyke
Keyword(s):  
Time Series ◽  
Financial Development ◽  
Poverty Reduction ◽  
Financial Sector ◽  
Consumption Expenditure ◽  
Causality Test ◽  
Reduction Strategies ◽  
Private Credit ◽  
Per Capita ◽  
The Impact

The impact of financial development on poverty reduction has received attention in the literature recently. While the connection between financial development and poverty may appear straight forward in theory, in empirics it may be much complicated. This study attempted at empirically assessing the causal links between financial development and poverty reduction in China for the period 1985–2014. The study used the Toda-Yamamoto causality test to avoid pretesting bias that has featured majority of the existing studies. The study utilized two standard proxies for financial development, namely: the domestic private credit by banks as percentage of GDP, and money supply (M2) as percentage of GDP; and a standard proxy for poverty reduction namely: the household final consumption expenditure per capita growth (annual percentage). The study found a bidirectional causal flow between financial development and poverty reduction, implying that the causal flow between these important variables is independent of the proxy for financial development. This means that financial sector reforms and poverty reduction programs are more of “win-win” strategies in the case of China. Therefore policymakers in China should continue to implement robust financial sector reforms and poverty reduction strategies.

scholarly journals Does Financial Development Lead to Poverty Reduction in China? Time Series Evidence

2017 ◽  
Vol 9 (1(J)) ◽  
pp. 99-112
Author(s):  
Sin-Yu Ho ◽  
Bernard Njindan Iyke
Keyword(s):  
Time Series ◽  
Financial Development ◽  
Poverty Reduction ◽  
Financial Sector ◽  
Consumption Expenditure ◽  
Causality Test ◽  
Reduction Strategies ◽  
Private Credit ◽  
Per Capita ◽  
The Impact

The impact of financial development on poverty reduction has received attention in the literature recently. While the connection between financial development and poverty may appear straight forward in theory, in empirics it may be much complicated. This study attempted at empirically assessing the causal links between financial development and poverty reduction in China for the period 1985–2014. The study used the Toda-Yamamoto causality test to avoid pretesting bias that has featured majority of the existing studies. The study utilized two standard proxies for financial development, namely: the domestic private credit by banks as percentage of GDP, and money supply (M2) as percentage of GDP; and a standard proxy for poverty reduction namely: the household final consumption expenditure per capita growth (annual percentage). The study found a bidirectional causal flow between financial development and poverty reduction, implying that the causal flow between these important variables is independent of the proxy for financial development. This means that financial sector reforms and poverty reduction programs are more of “win-win” strategies in the case of China. Therefore policymakers in China should continue to implement robust financial sector reforms and poverty reduction strategies.

Money-laundering risk and preventive measures in Pakistan

2020 ◽  
Vol 23 (3) ◽  
pp. 699-714
Author(s):  
Irfan Hassan Jaffery ◽  
Riffat Abdul Latif Mughal
Keyword(s):  
Money Laundering ◽  
Task Force ◽  
New Technology ◽  
Control Measures ◽  
Due Diligence ◽  
Content Type ◽  
Record Keeping ◽  
Financing Of Terrorism ◽  
Customer Due Diligence ◽  
The Impact

Purpose The purpose of this paper is to examine the effectiveness of anti-money laundering/combating of financing of terrorism (AML/CFT) measures in Pakistan. Key variables of AML/CFT regulations of Pakistan are used. This study explores the impact of customer due diligence, record keeping, wire transfers, correspondent banking, reporting of transactions, new technology and internal controls/compliance/trainings on money-laundering risk. Design/methodology/approach Data is collected with the help of questionnaires developed in light of Financial Actions Task Force (FATF) recommendations and the AML/CFT regulations of Pakistan. Findings Results show that customer due diligence, correspondent banking and new technology may help control money-laundering risk in Pakistan, whereas impact of record keeping, wire transfers and reporting of transactions did not have an effect on money-laundering risk. This study suggests a better implementation of these measures. Research limitations/implications The current study was limited to Pakistani banks. For more conclusive results, future studies should replicate similar studies in other countries. Practical implications Findings of this study may help the State Bank of Pakistan in taking measures to simplify the process of implementing FATF rules and regulations regarding AML/CFT, regular monitoring and trainings to the staff of banks and development finance institutions in customer due diligence, correspondent banking and new technology. Further, it helps to take appropriate measures in resolving banks-specific issues related to AML/CFT. Social implications Effective AML/CFT control measures would strengthen socio-economic growth in a country. Further, formalization, compliance and integrity would eliminate money laundering risk. It would create an economy that works with equity and promotes transparency. Originality/value This research paper supports implementation of AML/CFT regulations, proper monitoring and novel supervision of banks.

scholarly journals Comparing the responses of the UK, Sweden and Denmark to COVID-19 using counterfactual modelling

2021 ◽  
Vol 11 (1) ◽  
Author(s):  
Swapnil Mishra ◽  
James A. Scott ◽  
Daniel J. Laydon ◽  
Seth Flaxman ◽  
Axel Gandy ◽  
...  
Keyword(s):  
Reproduction Number ◽  
Mechanistic Model ◽  
Total Mortality ◽  
Control Measures ◽  
Mortality Data ◽  
Time Varying ◽  
Per Capita ◽  
The Uk ◽  
The Impact ◽  
Counterfactual Approach

AbstractThe UK and Sweden have among the worst per-capita COVID-19 mortality in Europe. Sweden stands out for its greater reliance on voluntary, rather than mandatory, control measures. We explore how the timing and effectiveness of control measures in the UK, Sweden and Denmark shaped COVID-19 mortality in each country, using a counterfactual assessment: what would the impact have been, had each country adopted the others’ policies? Using a Bayesian semi-mechanistic model without prior assumptions on the mechanism or effectiveness of interventions, we estimate the time-varying reproduction number for the UK, Sweden and Denmark from daily mortality data. We use two approaches to evaluate counterfactuals which transpose the transmission profile from one country onto another, in each country’s first wave from 13th March (when stringent interventions began) until 1st July 2020. UK mortality would have approximately doubled had Swedish policy been adopted, while Swedish mortality would have more than halved had Sweden adopted UK or Danish strategies. Danish policies were most effective, although differences between the UK and Denmark were significant for one counterfactual approach only. Our analysis shows that small changes in the timing or effectiveness of interventions have disproportionately large effects on total mortality within a rapidly growing epidemic.

scholarly journals A Study of SARS-COV-2 Outbreaks in US Federal Prisons: the Linkage Between Staff, Inmate, and Community Transmission

2021 ◽  
Author(s):  
Sherry Towers ◽  
Danielle Wallace ◽  
Jason Walker ◽  
John M. Eason ◽  
Jake R. Nelson ◽  
...  
Keyword(s):  
Negative Binomial ◽  
T Test ◽  
Control Measures ◽  
Security Level ◽  
Federal Prisons ◽  
Per Capita ◽  
Student’S T ◽  
Lower Ratio ◽  
The Impact ◽  
Student’S T Test

Abstract BackgroundSince the novel coronavirus SARS-COV-2 was first identified to be circulating in the US on January 20, 2020, some of the worst outbreaks have occurred within state and federal prisons. The vulnerability of inmate populations, and the additional threats posed to the health of prison staff and the people they contact in surrounding communities underline the need to better understand the dynamics of transmission in the inter-linked inmate/staff/community sub-populations to better inform optimal control of SARS-COV-2.MethodsWe examined SARS-CoV-2 case data from 101 non-administrative federal prisons between 5/18/2020 to 01/31/2021 and examined the per capita size of outbreaks in staff and inmates compared to outbreaks in the communities in the counties surrounding the prisons during the summer and winter waves of the SARS-COV-2 pandemic. We also examined the impact of decarceration, comparing inmate, staff and community SARS-COV-2 outbreak sizes during the winter wave to the summer wave.ResultsFor both the summer and winter waves we found significant inter-correlations between per capita rates in the outbreaks among inmates, staff, and the community.Over-all during the pandemic, per capita rates were significantly higher in inmates than in both the staff and community (paired Student’s t-test p=0.03 and p<0.001, respectively). Per capita rates of inmate outbreaks depended significantly on security level, ranked from lowest to highest: High, Minimum, Medium, and Low security (population standardized Negative Binomial factor regression p=0.02).Federal prisons decreased the number of inmates by a relative factor of 96% comparing the winter to summer wave (one SD range [90%,102%]). Prisons with relative decarceration below the mean had significantly lower ratio of winter to summer per capita rates in inmates, and also in the surrounding counties (two-sided Student’s t-test p=0.04 and p=0.02, respectively). To our knowledge, this is the first analysis to examine the impact of decarceration on community rates of SARS-COV-2 transmission. ConclusionsWe found significant evidence of community/staff/inmate inter-linkage of SARS-COV-2 transmission. Decarceration ameliorates both prison and community SARS-COV-2 per capita rates. Further study is warranted to determine which control measures aimed at inmates and/or staff are most efficacious at preventing or controlling outbreaks.

scholarly journals Impact Assessment of Macroeconomic Indicators on Happiness Level

2020 ◽  
Vol 17 (4) ◽  
pp. 760-769
Author(s):  
O. N. Antipina ◽  
◽  
A. D. Krivitskaya ◽  
Keyword(s):  
Academic Research ◽  
Well Being ◽  
Gdp Per Capita ◽  
Subjective Well Being ◽  
Negative Consequences ◽  
Macroeconomic Indicators ◽  
Negative Effect ◽  
Per Capita ◽  
Econometric Approach ◽  
The Impact

This paper studies the effects of objective macroeconomic indicators on measures of subjective well-being. This issue is central to the economics of happiness as a modern academic research discipline. The article provides an econometric approach to identifying the impact of changes in macroeconomic indicators on the reported level of happiness. We used models on panel data for 163 countries for the period from 2005 to 2019. The results of modeling showed that GDP per capita has a significant positive effect while unemployment and inflation, a significant negative effect on happiness. Our quantitative results show that unemployment depresses the reported level of happiness more than inflation does. Our research complements a number of macroeconomic studies in the field of public and subjective well-being: it focuses on links between the reported level of happiness and GDP per capita and determines social and economic costs of unemployment and inflation. These studies are of particular importance in the context of digitalization of the economy and the negative consequences of the COVID-19 pandemic.

scholarly journals Capital Inflows and Economic Growth in Selected COMESA Member Countries

2021 ◽  
pp. 25-50
Author(s):  
Lucas Njoroge
Keyword(s):  
Economic Growth ◽  
Financial Sector ◽  
Jel Classification ◽  
Capital Inflows ◽  
Gdp Per Capita ◽  
Positive Role ◽  
Capital Growth ◽  
Financial Depth ◽  
Per Capita ◽  
The Impact

Abstract This study examines the impact of capital inflows (FDI, ODA and Remittances) on economic growth in COMESA member countries. Applying System GMM estimation, the study finds a positive and significant relationship between capital inflows (except remittances) and GDP per capita growth, supporting the positive role capital inflows play in bridging the savings and investment gap, by providing finance for investment. However, remittances do not significantly influence GDP per capital growth. Remittances contribute positively to GDP per capita growth only when interacted with a variable for domestic financial depth. Examining whether capital inflows adversely affect economic growth, the study finds that except for the remittances whose effect is not significant, capital inflows (FDI, ODA and total inflows) leads to an appreciation of the REER, that may be detrimental to growth. The parameter for remittances does not significantly effect REER, implying that remittances are in most cases used to smoothen households’ consumptions during macroeconomic shocks and hence are counter-cyclical in nature. The study recommends, among others, financial sector reforms that will ensure increased depth of the domestic financial sector, capable of harnessing and providing efficient vehicles that can direct remittances for investment. JEL classification numbers: F15, F21, F24, F35, F43, F45. Keywords: Capital inflows, Economic Growth, COMESA.

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