Money-laundering and global efforts to prevent it

Money-laundering and global efforts to prevent it

The advent of globalization shrunk the world and brought about numerous positive changes. It has turned the world into a global village by integrating capital, information and technology in every corner resulting in a single global market. It has enabled people to reach around the world farther and faster than ever before.

But while expanding opportunities for free market, globalization has also increased risks. It has leveraged the international financial system into a money-launderers dream and has come across as a critical challenge for regulators and law enforcement agencies.

In simple terms, money-laundering is the process by which criminals attempts to disguise the origin and ownership of the proceeds of their criminal activities with the aim of converting such criminal proceeds into clean money. It is an integral aspect to almost every criminal activity that yields profit. A serious financial crime with global outreach, it involves a deep rooted and complicated system of transactions spreading across various jurisdictions.

Due to complexity of this crime, it has been traditionally difficult to investigate and prosecute the perpetrators. However, the global anti money-laundering (AML) efforts have paved way for successful prosecution and prevention of this crime. International AML regime includes a variety of soft law principles that involve voluntary arrangements among states as well as a more specific legal framework that binds an increasing number of major states.

Particularly, the Financial Action Task Force (FATF) with its member states has played a critical role in intercepting money-laundering, by evolving international rules that require financial institutions to adopt levels of transparency and disclosure to successfully prevent financial crime.

Money-laundering does not only have devastating effects on the soundness of financial institutions but also undermine the political stability of democratic nations. Criminals quickly transfer large sums of moneys to and from countries, distorting the demand of money at the macro-economic level and effecting the international capital flows and exchange rates.

Countries can take a number of steps to combat money-laundering. A start would be to take the legal course and criminalize laundering. It is also important to repeal bank secrecy laws to allow flow of required information to law enforcement agencies. It is similarly crucial to enhance cooperation between law enforcement agencies, financial institutions and judiciary to successfully prosecute the launderers. Owing to the ease and speed criminals can layer and integrate funds across international boundaries, it is equally pertinent to ensure international cooperation between countries.

We at CurrencyTube take pride in our strict compliance with the rules and regulations of the financial authorities in UK, to help prevent the menace of money-laundering. On the other hand, we strive to provide secure and reliable services for our law-abiding citizens for them to utilize the perks of globalization.


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