Journal Cover
Journal of Money Laundering Control
Number of Followers: 367  
  Hybrid Journal Hybrid journal (It can contain Open Access articles)
ISSN (Print) 1368-5201
Published by Emerald Homepage  [342 journals]
  • Editorial
    • Pages: 122 - 123
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 122-123, May 2018.

      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:18:52Z
      DOI: 10.1108/JMLC-02-2018-0012
  • Mafia, money-laundering and the battle against criminal capital: the
           Italian case
    • Pages: 124 - 133
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 124-133, May 2018.
      Purpose This paper aims to look at the case of Italy, which clearly stands out in its relationship with organised crime. The recognition that money is the “lifeblood” of OC has resulted in the implementation of what we can refer to as the anti-money laundering (AML) regime, which backs the systematic targeting of mafia assets and the application of severe obstacles to the concealment of dirty money through increased financial surveillance. This paper discusses the financialisation of counter-mafia strategies, with the purpose of questioning the extent to which this system has been delivering what it promised. Design/methodology/approach The paper is divided into three chapters. The first chapter looks at the relationship between Italian mafia and dirty money. The second chapter discusses the rationale and pillars of the AML regime. Finally, the last section examines and discusses recent evidence of the outcome of AML policies, by looking at figures as reported by relevant entities, such as the Financial Intelligence Unit (FIU), Europol, the Italian Ministry of Interior and the Direzione Investigativa Anti-Mafia (DIA). Findings Evidence suggests that financial surveillance, the first pillar of the AML regime, is much costlier than it is beneficial to society. Reporting of suspicions has rocketed in the past years, bringing very little change to yearly ML convictions, and being only marginally helpful in mafia-related investigations, confiscations and arrests. The confiscation of assets from mafia members, i.e. the second pillar of the AML regime, has proven to be effective in gaining control over large sums and goods. However, more research is needed around the question of confiscated asset-management and desirable re-investment opportunities. Originality/value As the AML regime gains in prominence internationally, it is of great value to assess its achievements so far. This is especially true of a country like Italy, which suffers from a long-standing mafia dominance. This paper represents a modest initial inquiry, which will hopefully be complemented by future research to come to an in-depth understanding of the value and limitations of an AML regime in fighting OC.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:18:45Z
      DOI: 10.1108/JMLC-02-2017-0009
  • Legislative kleptocracy in Nigeria: systems approach
    • Pages: 134 - 148
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 134-148, May 2018.
      Purpose The purpose of this study is to explore legislative kleptocracy, specifically, budget padding, in Nigeria’s budding democracy, using systems thinking approach for a positive social change. Nigeria’s legislature is not free from the problem of kleptocracy inasmuch as some legislators have been charged with kleptocratic activities. The multifariousness of kleptocracy rooted in its differential coefficient in the Nigeria’s legislature does not underplay its sophistication. Design/methodology/approach In this qualitative analysis, the author generated data through a systematic analysis of documents. Findings The findings show that unexplored organismic factors or forces within the living being such as the inability of legislators to control their mind, low self-control, cheating propensity, identity crisis, etc., play vital roles in contributing to legislative kleptocracy. Research limitations/implications The main limitation of the study is that it is not generalizable. Practical implications The practical implication of the study is that implementation of the study recommendations is pragmatic, cost-effective and time-effective, and it would ensure legislative transformation and mitigate kleptocracy. Social implications The social implication of the study is if the Nigerian legislature implements the recommendation(s) of the study, there will be a legislative positive social change because financial crimes would have been mitigated. Originality/value This study filled the lacuna in the financial crime literature because it is the first of its kind in the discipline, and hence its originality cannot be disputed.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:18:47Z
      DOI: 10.1108/JMLC-02-2017-0006
  • The recent formulation of “having reasonable grounds to
    • Pages: 149 - 162
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 149-162, May 2018.
      Purpose The purpose of this study is to analyse the challenges in devising a suitable formulation to determine whether a person had reasonable grounds to believe that property dealt with represented the proceeds of an indictable crime in the context of money laundering offences. The paper also examines the Hong Kong Court of Final Appeal’s recent formulation in HKSAR v. Yeung Ka Sing, Carson (decided July 2016) and evaluates international standards. Design/methodology/approach The methodology adopted is partly a technical analysis of the various interpretations of “having reasonable grounds to believe” alongside a comparative approach drawing on international standards of the mens rea threshold and the position in the UK. Findings The findings are that the Court of Final Appeal’s formulation of “having reasonable grounds to believe” is the best possible outcome given the confines of the statutory provisions. The study confirms that the threshold set by the Court of Final appeal surpasses international standards; however, it argues that current international standards are in need of review. Originality/value This paper offers insight into the latest mens rea threshold of “having reasonable grounds to believe” in the context of Hong Kong’s anti-money laundering laws and compares international standards of the mens rea threshold. The discussion is of value to a wide audience both in Hong Kong and globally. It aims to provide guidelines to legal practitioners, law enforcement personnel, persons in the private and public sectors, academics and members of the public. This paper also seeks to provoke discussion as to whether international standards on the mens rea threshold should be reviewed with a view to strengthening international cooperation on the prevention of money laundering.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:19:12Z
      DOI: 10.1108/JMLC-04-2017-0012
  • Pyro terrorism in Greece' Greek forest fires August 2007 and the
           impact on Greek banks stocks
    • Pages: 163 - 170
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 163-170, May 2018.
      Purpose The purpose of this paper is to examine Greek forest fires in August 2007 and statements about terrorism (pyro-terrorism) and the impact on Greek banks stocks. Design/methodology/approach Event study methodology and market model is used in this paper and data of all Greek bank stocks prices listed in Athens Stock Exchange are analysed, before and after 17 August 2007, which is when forest fires took place in Greece. Findings Total number of burned acres during a seven-year period, 2000-2006, was 2,530,883, and during only August 2007, burned acres accounted to 2,059,615. The former Minister for Public Order, Vyron Polydoras, stated the fires may be a result of terrorist attacks, as many of the fires started simultaneously and in places where an arsonist could not be seen. The Minister also stated that the country is facing an asymmetric threat, a military term used for terrorist attacks. The findings of event study methodology and market model show that CAARs were slightly negative but not statistically significant and during event date, and average abnormal return (AAR) was slightly positive at 0.0273 per cent. The event caused no influence on the stock market. Practical implications Results are important for banking system, compliance and regulatory authorities, justice system and politicians. Originality/value The impact of Greek forest fires in August 2007 on Greek banks stocks has not been examined so far.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:19:27Z
      DOI: 10.1108/JMLC-04-2017-0014
  • Creating and building a post-conflict fiscal state through global wealth
    • Pages: 171 - 188
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 171-188, May 2018.
      Purpose This paper aims to assess using a historical approach the challenges facing Somaliland and analyze how the Somalilanders are in the twenty-first century using the globalized financial architecture and system of wealth chains to finance their nascent state and move the debate forward on the calls for self-determination. Design/methodology/approach Research on this paper included not just a desk review but two research trips to Somaliland and over 20 interviews of politicians, government officials and the private sector and academia. Findings Today the global wealth chains flowing in and out of Somaliland include some complex ones which include the interactions with other members of the Somali diaspora whether they are in the USA or in Australia where money moves in and out of bank accounts in different countries finally ending up in either Dubai or Djibouti where it is finally transferred through the money transfer agencies into Hargeisa and finally withdrawn by the relative of a diaspora member. The similar wealth chains are those going between traders such as those that already maintain companies in Djibouti because of the war period and continue to live and trade there but have branches in Somaliland. There are simple direct transfers that are easily understood. Research limitations/implications Translators had to be used, as some parliamentarians only spoke Kisomali. Originality/value No papers have been written on the global banking and finance system with specific reference to Somaliland.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:18:50Z
      DOI: 10.1108/JMLC-05-2017-0019
  • China’s dirty laundry – international organizations posing a risk to
           China’s AML systems
    • Pages: 189 - 202
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 189-202, May 2018.
      Purpose This paper aims to review some of the current challenges that international money laundering schemes are posing in the Chinese banking sector. Anti-money laundering (AML) systems in China are relatively new, and customer due diligence checks and other AML systems are underdeveloped in some areas. Design/methodology/approach The paper considers a particular case example of a multi-company organization that has known links to China. This company has been the target of both European and US investigations for suspected embezzlement and money laundering, and yet is still in operation. Findings The paper considers the complexities of this organization and how a seemly innocent link to a used clothing charity can fund an international organization spanning several countries. The paper offers a list of basic indicators of risk that could be applied to a risk-based system used within the Chinese banking context by using this group as an example. Originality/value The paper uses empirical and academic studies from other authors working in this region and supports many of the findings of the need to develop stronger risk-based, as opposed to rules-based, systems for managing AML risk assessment. Previous work by the author and suggestions from other authors are both used to suggest a basic framework for AML risk assessment. The paper concludes by reiterating the fact that China, like all other countries, is now operating in an international banking context, in much the same way that international organized crime is also operating at a global level.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:18:57Z
      DOI: 10.1108/JMLC-08-2015-0032
  • Slipping through the net
    • Pages: 203 - 214
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 203-214, May 2018.
      Purpose The purpose of this paper is to highlight the activities of the FCA with respect to the incidence of money laundering and highlight regulatory gaps. The financial services sector provides a crucial infrastructure for the promotion of wealth and innovation in the UK. This attractive infrastructure also appeals to criminals looking to launder the gains of their illicit activities. Design/methodology/approach The paper analyses the UK money laundering regime, highlighting specific challenging areas. The paper investigates the role of politically exposed persons and the use of corporate structures in promoting money laundering. In this context, it also becomes crucial to investigate the role of financial institutions and the sufficiency of their governance approach in lessening the incidence of money laundering. The paper investigates secondary sources and relies on their findings. It compares these findings to the regulatory outcomes. Findings The paper recommends steps that can be used to lessen the incidence of money laundering in the UK. From the reports evaluated, it is clear that the Financial Conduct Authority is working towards reducing the incidence of money laundering, but this could be further strengthened with the adoption of additional enforcement tools. Practical implications The paper suggests that different approaches should be used based on firm size, the type of business and the risk that a financial services firm presents to the financial sector. A large firm will need to bear more regulatory burden compared to a smaller firm. Originality/value The paper investigates the current approach to minimising the incidence of money laundering in the UK. It suggests that the regulator can guide financial services firms to meet the regulatory objectives by relying on an approach that discerns the regulatory risks presented by different firms depending on their size.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:18:53Z
      DOI: 10.1108/JMLC-06-2017-0025
  • Anti-money laundering effectiveness: assessing outcomes or ticking
    • Pages: 215 - 230
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 215-230, May 2018.
      Purpose This article aims to constructively critique the new global methodology for evaluating the effectiveness of anti-money laundering regimes against defined outcomes. Design/methodology/approach With surprisingly little discussion at the intersection of the money laundering and policy effectiveness and outcomes scholarship and practice, this article combines elements of these disciplines and recent peer-review evaluations, to qualitatively assess the Financial Action Task Force’s (FATF’s) anti-money laundering “effectiveness” methodology. Findings FATF’s “effectiveness” methodology does not yet reflect an outcome-oriented framework as it purports. Misapplication of outcome labels to outputs and activities miss an opportunity to evaluate outcomes, as the impact and effect of anti-money laundering policies. Practical implications If the “outcomes” of the “effectiveness” framework do not match the crime and terrorism prevention policy goals of nation states, the new “main” component for assessing the effectiveness of anti-money laundering regimes potentially detracts focus and resources from, rather than towards, intended policy objectives. Originality/value There is a dearth of scholarship whether the global anti-money laundering “effectiveness” framework is sufficiently robust to assess effectiveness as it purports. This article begins addressing that gap.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:18:41Z
      DOI: 10.1108/JMLC-07-2017-0029
  • Illicit financial flows: HSBC case study
    • Pages: 231 - 246
      Abstract: Journal of Money Laundering Control, Volume 21, Issue 2, Page 231-246, May 2018.
      Purpose This paper provides examples of how illicit financial flows (IFFs) are occurring through the formal banking and financial services sector. The purpose of this paper is to explore which elements of anti-money laundering (AML) compliance need to be addressed to strengthen the banking response and reduce the impact of IFFs within the banking sector. Design/methodology/approach The paper uses a number of sources of secondary data including the Swiss leaks data for HSBC and also the Permanent Sub Committee Report on HBUS in the USA, the OECD report on money laundering compliance and Financial Action Task Force (FATF) guidelines on beneficial ownership. It links this information to the relevant IFF reports produced through Global Financial Integrity to highlight the connection between banking AML compliance and IFF transfers through the banking sector. Findings The main findings from the analysis are that banks have a greater legal responsibility towards detecting and reporting suspicious transactions than they would have previously considered. This includes identifying the source and purpose of fund transfers and establishing the beneficial ownership of recipients. Research limitations/implications The research topic is new; therefore, analysis papers and other academic writing on this topic are limited. Practical implications The research paper has identified a number of implications to the banking sector on addressing AML deficiencies, especially the need to improve standards of beneficial ownership verification and customer due diligence (CDD) checks for politically exposed persons. Social implications This paper has implications for the international development and the global banking sector. It will also influence approaches to AML regulation, risk assessment and audit within the broader financial services sector. Originality/value The originality of this paper is the link between the HSBC cases and IFFs and the implications this will have for future AML compliance processes across the banking sector.
      Citation: Journal of Money Laundering Control
      PubDate: 2018-05-11T11:19:14Z
      DOI: 10.1108/JMLC-08-2015-0036
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