Journal Cover Journal of Financial Crime
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   Hybrid Journal Hybrid journal (It can contain Open Access articles)
   ISSN (Print) 1359-0790
   Published by Emerald Homepage  [335 journals]
  • Editorial
    • Pages: 494 - 495
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 494-495, October 2017.

      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:09Z
      DOI: 10.1108/JFC-07-2017-0065
       
  • Combatting the global crime of bribery: a report on Canadian foreign
           official anti-bribery policy
    • Pages: 496 - 512
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 496-512, October 2017.
      Purpose The purpose of this paper is to provide an updated review of Canadian foreign official anti-bribery policy. Design/methodology/approach To achieve this objective, seven factors were examined. Several factors have been emphasized by the Organisation for Economic Co-operation and Development, and others are original. Findings The results indicate that while Canada is making progress towards strengthening its foreign official anti-bribery policy, significant weaknesses still remain. Originality/value This study adds to the literature in this area by utilizing several new factors which attempt to gauge the effectiveness of foreign official anti-bribery policy.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:11Z
      DOI: 10.1108/JFC-11-2015-0065
       
  • Too big to fail, too big to jail: restoring liability a lesson from HSBC
           case
    • Pages: 513 - 519
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 513-519, October 2017.
      Purpose This paper aims to highlight the shift of impunity from institutions to individuals within the “too big to fail, too big to jail” paradigm and to restore individual liability in the financial industry. Design/methodology/approach The paper is based on the analysis of HSBC deferred prosecution agreement concluded on December 10, 2012 and of a report by the US House of Representatives Financial Committee released in July 2016. Findings “Too big to fail, too big to jail” is a paradigm which contains justice. It leads to the impunity of individuals involved due to the absence of trial. Containment of justice is denial of justice. However, the systemic risk is attached to institutions, not to individuals. Therefore, it should not hamper the prosecution of individuals. Practical implications Setting sanctions applicable to individuals and proportionate to the crime would contribute to deter financial misconducts. Originality/value The value of the paper is the demonstration that there is no basis for a limited personal liability in the financial industry.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:46Z
      DOI: 10.1108/JFC-09-2016-0061
       
  • Fortifying a risk-based approach in the South African AML/CFT process
    • Pages: 520 - 528
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 520-528, October 2017.
      Purpose The purpose of this paper is evaluate the provisions of Financial Intelligence Centre Act Amendment Bill, 2016 which intends to give effect to the implementation of the envisioned risk-based approach in anti-money laundering/combating financing of terrorism (AML/CFT) processes, as well as the extent to which the provisions address certain technical shortcomings elucidated in 2009 Mutual Evaluation Report concerning South Africa’s AML/CFT’s framework. Design/methodology/approach Sources of information consisted of scholarly articles, articles retrieved from the Web, news reports, reports published by national and international regulatory bodies, legislation and draft legislation. Findings Findings suggest that the South African legislature not only addresses the particular shortcomings specifically highlighted in the 2009 Mutual Evaluation Report comprised by the Financial Action Task Force but also requires the establishment of a framework for the realisation of a risk-based approached in every “risk” scenario and on an on-going basis. Practical implications Accountable institutions will be required to establish and implement a Risk Management and Compliance Program which must provide both the framework and the strategy for the execution of the risk-based approach when establishing a business relationship, during the course of administrating the business relationship as well as when concluding any single transaction in pursuit of the business relationship. Originality/value This paper serves to alert accountable institutions, compliance and corporate governance professionals and AML and counter-terrorist financing practitioners of the risk-based approach South African accountable institutions will be obliged to implement in their AML/CFT processes, the extent to which a risk-based approach must be incorporated and the aspects that must be provided for in terms of the mandated Risk Management and Compliance Program once the Financial Intelligence Centre Act Amendment Bill, 2016 is signed into law.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:47Z
      DOI: 10.1108/JFC-01-2017-0007
       
  • Financial crime – is there any way out of the theoretical
           deadlock'
    • Pages: 529 - 540
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 529-540, October 2017.
      Purpose This paper aims to approach fundamental topics of financial crime and the law. What does constitute financial crime' Which field of law is best suited to address the threats of transgression by financial executives' What does motivate highly rewarded financiers to become white collar criminals' Design/methodology/approach To answer these research questions, contemporary theories of criminology in general and of white collar crime in particular, as well as theories on motivation, are critically discussed. Benefits and limitations of the theories in use are exemplified on the background of the London Interbank Offered Rate (LIBOR) scandal. Findings The paper criticises that the state-of-the-art theories are not able to embrace financial criminality in its entirety. A provoking pace for further research might be that of psychopathic disorders among white collar criminals. Thus, white collar crime maintains its challenging character. Originality/value This paper provides a thorough testing of multidisciplinary theories that emerged over the past decades against the recent LIBOR scandal. The research questions addressed and the methodologies applied provide a framework for the assessment of the prevailing theories against other financial scandals.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:24Z
      DOI: 10.1108/JFC-06-2016-0043
       
  • Characteristics of real backdaters
    • Pages: 541 - 551
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 541-551, October 2017.
      Purpose Recent findings show that CEOs tend to backdate their stock option grants so that a past date on which the stock price was particularly low is picked to be the grant date. Using cases now settled concerning a group of firms that were caught backdating, this paper aims to examine further whether backdating firms have higher levels of operating efficiency and corporate governance, lower levels of bankruptcy risk, more ability to increase shareholder wealth, and lower levels of market price risk. This paper also compares the characteristics of backdating firms during the pre-Sarbanes-Oxley Act of 2002 (SOX) and post-SOX periods. Design/methodology/approach This sample of backdater firms comprises those caught backdating who have settled their cases, according to data provided by Risk Metrics Group, a non-profit organization that keeps track of most securities class actions. A matched sample of 28 non-backdating, comparison-group firms was constructed to perform univariate and multivariate comparisons. Findings This study found that backdating firms on average have a higher price risk than non-backdating firms, and that increasing the percentage of shares owned by the major shareholders reduces the possibility of management conducting backdating activities. Originality/value No previous studies have used a sample of real backdating culprits. Previous studies have usually used likely backdating traits to identify a group of suspected backdaters. In contrast, the current study, by using a group of firms whose deliberate backdating behavior had led to lawsuits that have been settled in court, investigated the characteristics of known backdaters.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:13Z
      DOI: 10.1108/JFC-05-2016-0034
       
  • De-normalizing corruption in the Indonesian public sector through
           behavioral re-engineering
    • Pages: 552 - 573
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 552-573, October 2017.
      Purpose Based on the authors’ study, the purpose of this paper is to ascertain the best approach to mitigate corruption in the Indonesian public sector. To do so, the paper uses three behavioral perspectives: the Schemata Theory, the Corruption Normalization Theory and the Moral Development Theory. Design/methodology/approach This paper is part of the authors’ study to examine corruption patterns in Indonesia in the past 10 years through examination of reports from various institutions as well as other relevant documents addresses corruption-related issues to explore various options for mitigating corruption through behavioral re-engineering. For the purpose of gaining various perspectives on anti-corruption measures, this study also uses expert interviews and focus group discussions with relevant experts in Indonesia and Australia on various corruption-related issues. Findings The authors establish that despite the fall of the New Order regime nearly two decades ago, corruption remains entrenched within the post-Suharto Governments. The normalized corruption in Indonesia is a legacy of the New Order regime that shaped societal, organizational and individual schemata in Indonesia. The patrimonial style of leadership in particular within the regional governments resulted in increasing rent-seeking activities within the decentralized system. The leadership style is also believed to have been supporting the normalization of corruption within the public sector since the New Order era. The three-decade-old systematic normalization of corruption in the Indonesian public sector can only be changed by means of long and systematic de-normalization initiatives. To design the best intervention measures, decision makers must first identify multiple factors that constitute the three normalization pillars: institutionalization, rationalization and normalization. Measures such as periodical reviews of operational procedures, appointment of leaders with sound morality, anti-corruption education programs, administering “cultural shocks”, just to name a few, can be part of multifaceted strategies to bring down the normalization pillars. Research limitations/implications The discussion on the options for de-normalization of corruption in Indonesia is focused on corruption within the Indonesian public institutions by interviewing anti-fraud professionals and scholars. A better formulation of strategic approaches can be developed by means of interviews with incarcerated corruption offenders from the Indonesian public institutions. Practical implications This paper contributes to the development of corruption eradication strategy by suggesting options for de-normalizing corruption in the Indonesian public sector so that resources can be allocated more effectively and efficiently to mitigate the problem. Originality/value This paper highlights the importance of behavior-oriented approaches in mitigating corruption in the Indonesian public sector.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:36Z
      DOI: 10.1108/JFC-10-2015-0057
       
  • Punishing tax offenders in France and Great Britain: two criminal policies
    • Pages: 574 - 588
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 574-588, October 2017.
      Purpose Since 2008-2009, the governments in France and Great Britain have encouraged more rigorous penalization of tax evaders. This paper aims to investigate the implementation of these policies on the basis of an important and original empirical material. Design/methodology/approach The study done in France relies on interviews conducted with representatives of law enforcement agencies on public statistics and on an innovative database compiled from nearly 600 cases submitted to the judiciary. The comparison with Great Britain is developed through interviews conducted with different participants in the fight against tax fraud and statistical information. Findings This paper describes the recent evolution of the machinery for screening tax-related wrongdoings in France and in the UK. It demonstrates that whilst publicly calling for harsh punishment against tax dodgers, in practice, both governments tend to seek a balance between the growing demand for tax equality and the belief that the State should not intervene in the economic realm. This strategy leads to the over-representation of certain categories of taxpayers. Despite the commonalities resulting from the numerous filters before prosecution, the penal strategy takes on two different shapes on either side of the Channel: whereas the British institutions support an “exemplary punitive” system, French regulatory system favours a “quasi-administrative” treatment. The French tax authority continues to use the criminal procedures mainly as a financial instrument for the improved restitution of stolen taxes. The policy of Her Majesty’s Revenue and Customs, supported by the “Sentencing Guidelines”, aims much more at obtaining exemplary convictions. Originality/value Based on a large empirical material, this paper highlights the different outcomes of the criminal trials against tax evaders in the two countries.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:41Z
      DOI: 10.1108/JFC-05-2016-0030
       
  • Ponzi schemes and the roles of trust creation and maintenance
    • Pages: 589 - 600
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 589-600, October 2017.
      Purpose The purpose of this study is to elaborate on how schemers build and maintain trust essential for financial fraud that persists over many years. A Ponzi scheme is a form of financial fraud that involves repeated interaction with an increasingly large number of individuals over a long period time. This type of fraud involves the building and maintenance of each individual’s trust. All Ponzi schemes come to a dramatic conclusion. Either the schemer defaults on payments, or someone gets suspicious and the scheme is uncovered. Understanding how schemers build and maintain trust may help prevent or uncover the fraud earlier, limiting financial devastation endured by unsuspecting investors, as well as externalities inflicted on the financial system as investors lose trust. Design/methodology/approach This study combines an understanding of trust accumulation from multiple disciplines in the existing literature to build a comprehensive model of trust creation and maintenance in Ponzi schemes. Findings This study finds that key characteristics of both the trustor and trustee contribute to long term financial arrangements. Schemers prey on individuals with specific characteristics that indicate they are more trusting. Trusting individuals are less likely to conduct due diligence to detect fraud. Prevention and detection of fraud are made more difficult by convincing, yet false, mimicry used by schemers to signal trustworthiness. Originality/value Bringing together multiple views on trust allows creation of a comprehensive model of trust that captures key characteristics of unsuspecting investors and schemers who prey on them in financial fraud.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:34Z
      DOI: 10.1108/JFC-06-2016-0042
       
  • Corruption crime and punishment: evidence from China’s state
           corruption audits
    • Pages: 601 - 619
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 601-619, October 2017.
      Purpose This paper aims to answer the following two research questions: Do corruption cases present different features before and since the new administration in China' How are criminal penalties affected by these corruption features' Design/methodology/approach The investigation is based on the online disclosure of 269 state corruption audits and their consequences, which have been made public by China’s National Audit Office since 2011. By manual coding, these official reports were analyzed, and an appropriate-sized sample of corruption cases was chosen. The authors then adopted Welch’s t-test and regression model methods to test the research hypotheses relevant to the two research questions. Findings The authors find that larger embezzlement or bribery amounts and more organizational corruption cases have been detected and punished since the anti-corruption campaign was launched by the new administration. They also conclude that significantly tougher criminal penalties were given to corruption cases involving large monetary amounts, that bribery cases were more harshly punished compared to other occupational crimes and that individual perpetrators received tougher criminal penalties than organizational criminals. In addition, the authors observe a trend that criminal penalties for corruption have been increasingly harsher in recent years. Research limitations/implications The limitations of this study are quite clear as the Chinese corruption cases in this sample only include state corruption audit cases and does not refer to high-profile corruption cases investigated by the Central Commission of Discipline Inspection. However, this study suggests that state corruption audit results are a good research sample, which can be used to extend empirical tests to archival data acquired from state audit practices and can encourage more studies on public sector auditing and occupational financial crime. Practical implications State corruption audits can be an effective approach to successful anti-corruption campaigns, and the conclusions can be useful to policy makers and legislators in China and other developing countries. Originality/value This paper bridges some gaps in the existing financial crime literature. First, this study on corruption features is located within the context of a political administrative change; second, the state audit is highlighted as a supervising agency in the anti-corruption campaign; and third, the authors’ contribution adds to the empirical testing of data sets of state corruption audits within the existing financial crime literature.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:15Z
      DOI: 10.1108/JFC-06-2016-0044
       
  • Identifying fraud using restatement information
    • Pages: 620 - 627
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 620-627, October 2017.
      Purpose The purpose of this paper is to analyze the restatement information disclosed in the Form 8K and the Press Release. It examines the relationship between manipulating the quantity, quality, manner and timing of restatement information and the probability of committing fraud. Design/methodology/approach The authors used 18 informational indicators developed by BenYoussef and Breton (), and applied the prediction methodology based on F-scores, developed by Dechow et al. (). Findings Results indicate that the information content of restatement announcements provides significant insights into the likelihood of fraud occurrence. A firm that manipulated previous earnings will continue to do so, and will try to mislead investors by releasing inaccurate and incomplete information in the Form 8K and the Press Release. The model helps identify this manipulation and hence can be used as a tool for fraud detection. Research implications/limitations This paper applies the constructs drawn from Information Manipulation Theory to restatement contexts to detect fraud. Practical implications The paper is of use to regulators, investors and financial crime experts, as it provides insights to better fraud detection. Originality/value The paper is based on proprietary data that were hand collected, and is being used first time to predict fraud.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:03Z
      DOI: 10.1108/JFC-07-2016-0046
       
  • Reconsidering the effectiveness of an asset confiscation scheme
    • Pages: 628 - 636
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 628-636, October 2017.
      Purpose The purpose of this paper is to suggest how the effectiveness of an asset confiscation scheme might be evaluated by focussing on the currently operating Victorian model in Australia. For illustrative purposes, the offence of trafficking a commercial quantity of cannabis has been chosen. This is a topical and important issue, given two recent reports by the Victorian Auditor-General lamenting the absence of a suitable framework for evaluating the scheme’s performance. Because these programs provide important supplementary punishment tools, it is desirable that methodologies to gauge their efficacy be developed. Design/methodology/approach The approach to evaluating effectiveness is a mixture of criminological and economic theory coupled with some basic empirics. Utilising insights from the theories of valuing the social losses of crime and that of penalties provides a backdrop against which actual values of confiscated assets can be compared with ideal ones. Findings Comparison of actual and ideal values reveals a very considerable gap between the two, which suggests that the scheme is being underutilised relative to its maximum potential. The value of seized assets is well below the ideal order of magnitude. Even though the data on which this finding is based are sparse, the framework can be replicated as better statistics on the scheme’s operations become available. Originality/value The suggested methodology builds on and adds to current knowledge of evaluation techniques for legal system programs. Hopefully, it will provide stakeholders with yet another lens through which to view the operation of an asset confiscation scheme, and provide an impetus for collecting better quality data.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:33Z
      DOI: 10.1108/JFC-07-2016-0050
       
  • Spotting the lone actor: combating lone wolf terrorism through financial
           investigations
    • Pages: 637 - 642
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 637-642, October 2017.
      Purpose In 2014, Paul Gill et al. introduced a study of 119 lone-actor terrorism cases, and found that lone-actor extremists could be more accurately identified by their behavioural characteristics and activities, rather than their extremist ideologies. The study was said to have significant impact on intelligence analysis in the field of counterterrorism. The purpose of this paper is to apply Gill et al.’s findings to financial intelligence investigations, to assist investigators with the detection and prevention of lone-actor terrorist financing. Design/methodology/approach This article provides an overview of the key findings provided by Gill et al. It then discusses the indicators of lone-actor terrorism in the context of financial intelligence investigations, and sets out methods to improve financial intelligence investigations to better identify and stop lone-actor terrorism in the future. Findings By applying traditional financial intelligence techniques, which focus on assessing an individual’s activity and behaviour, with open-source intelligence gathering, financial intelligence investigators will be better equipped to identify lone-actor terrorism and its financing moving forward. Originality/value This article will be of value to investigators specializing in terrorism and financial crime, as it will assist them in the identification of a proliferating security threat, the lone-actor terrorist. While the article relies on the findings provided by Gill et al., it takes a new approach by applying those findings specifically to the financial intelligence sector, to improve investigations related to terrorism.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:06Z
      DOI: 10.1108/JFC-08-2016-0052
       
  • Unsafe insurance
    • Pages: 643 - 655
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 643-655, October 2017.
      Purpose The purpose of this paper is to study life-loss risk in some life insurance policies and propose solution to the problem found. Design/methodology/approach The paper analyzes the expected payout for murder-for-insurance. It presents legal evidence of 179 court cases and conducts criminological analysis. It compares the lack of safety regulation in life insurance with regulatory actions in selected food and automobile safety cases. Findings Some life insurance policies create incentives and, therefore, temptation for murder-for-insurance. The insured can face life-loss risk from not only the beneficiary but also the life insurance agent during the term of the policy. Practical implications This paper proposes that defective life insurance policies should be recalled. Social implications The proposal has a policy implication of eliminating one type of homicide. Originality/value This paper is the first study of its kind, as it places the safety of the insurance consumer in the center.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:39Z
      DOI: 10.1108/JFC-01-2016-0006
       
  • A cross-country study on manipulations in financial statements of listed
           companies
    • Pages: 656 - 677
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 656-677, October 2017.
      Purpose The purpose of this study is threefold: first, to detect trends in financial statement manipulation; second, to measure the level of manipulation and to measure the variation in manipulation between countries; and, third, to identify widely used techniques in financial statements manipulation. Design/methodology/approach This study uses financial data of listed companies from Asia, namely, Japan, Singapore, Malaysia, Indonesia, Thailand, Hong Kong and China. The study adopts financial ratios, financial forensic tool, dichotomous approach and statistical tools to analyze the data (84,000 observations) over a period of four years from 2010 to 2013. Findings The results show that 34 per cent of sample companies in selected Asian countries are involved in the manipulation of financial statements; the average level of manipulation (overall manipulation index) is 72 per cent; and there is a significant difference between countries at 5 per cent level. The study also identifies four most commonly used techniques, namely: days’ sales in receivable (DSRI), depreciation (DEPI), assets quality (AQI) and total accruals to total assets (TATA). Research limitations/implications Although this study found a significant national difference between countries in terms of practicing manipulation in financial statements, it did not address the issue of why some countries have higher level of manipulation and greater fluctuations in manipulation than others. Further study could be conducted to look for the reasons on these issues. Practical implications Investors and other stakeholders are advised to judge the manipulation in financial statements before fixing up for investment. At least they should examine Sales, Accounts Receivable, Depreciation, Value of Fixed Assets and Accruals data before accepting the financial statement in good faith. Social implications The trend of manipulation in financial statements is increasing day by day and that is why it needs to prevent to protect our society from white collar crime. The cost of white collar crime is much higher and key executives are making money at the expense of investors and other stakeholders. This kind of study creates awareness among stakeholders about the manipulation as well as provides techniques to examine the faithfulness of financial statements. Then, managers will not overstate or understate either revenues or expenses easily, as it can damage the goodwill. Originality/value This is the first study of its kind addressing measurement of manipulation score, overall manipulation index (OMI) and identification of widely used variables of manipulation in financial statements are new contributions towards existing literature of earnings manipulation.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:08Z
      DOI: 10.1108/JFC-07-2016-0047
       
  • Certainty and financial crime control
    • Pages: 678 - 690
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 678-690, October 2017.
      Purpose There has been a significant increase in the number of financial crime regulatory offences (as distinct from traditional fraud offences). The purpose of this paper is to address the question of how should those in positions of control and influence in management take steps to ensure the integrity of those under them and also the relevant conduct of their customers and clients in light of this proliferation. Design/methodology/approach The work, which is grounded in the field of criminology, uses a combination doctrinal (legal) and qualitative methods. Its emphasis is on mala prohibita (“wrong because they are prohibited”) offences rather than mala in se (“wrong or evil in itself”). The work situates regulatory offences within the broader criminological debate regarding financial crime. It then analyses and reviews the significance of the requirement for certainty in relation to mala prohibita offences. By reference to some Australian offences, the analysis moves to some offences where uncertainty manifests. Finally, the work proposes some practical ways in which those in positions of control and influence may provide certainty to those under them to ensure integrity. Findings The paper argues that a paramount step for those in positions of control and influence, in taking steps to ensure the integrity of those under them and also the relevant conduct of their customers and clients is to provide certainty with regard to the illicit activities relevant to their organisation to those persons under them. The work proposes some practical ways in which those in positions of control and influence may provide certainty to those under them to ensure integrity. Originality/value The work is novel because of its focus on regulatory mala prohibita offences rather than the traditional criminal law or mala in se offences (in relation to which there has been much more discussion).
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:43Z
      DOI: 10.1108/JFC-09-2016-0058
       
  • Suspicious alerts in money laundering – the Crédit Agricole
           case
    • Pages: 691 - 703
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 691-703, October 2017.
      Purpose The purpose of this paper is to provide an analysis of the recent Crédit Agricole case outcome, whereby the bank was found to have undertaken insufficient investigation and failed to follow through on reporting suspicious account activity, in line with AML compliance requirements. Design/methodology/approach The paper uses the two main legal documents in the Michailidis v Crédit Agricole Corporate and Investment (CACI) bank case and analyses the judgement details to discuss the implications for the banking and financial services sector on money laundering and AML compliance reporting requirements. 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, and 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 detection and reporting requirements of suspicious transactions. Social implications This paper has implications for the corporate social responsibility of banks and other financial services towards monitoring the source and use of money that is in their organisation. The paper identifies areas of legal responsibility that banks now have to manage, as part of their commitment to support the prevention of money laundering. Originality/value The originality of this paper is the current example of the Crédit Agricole case and the future legal implications for banks and financial services on suspicious transaction reporting and money laundering risk assessment.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:26Z
      DOI: 10.1108/JFC-12-2015-0074
       
  • How stock markets become desensitized to terror
    • Pages: 704 - 711
      Abstract: Journal of Financial Crime, Volume 24, Issue 4, Page 704-711, October 2017.
      Purpose A widely accepted belief indicates that terror activities have negative impact on stock markets. Contrary to numerous empirical studies, the purpose of this paper is to consider this issue from another point of view in the sense that markets can become desensitized to terror. Design/methodology/approach Here, instead of directly analyzing the existing data, the stochastic nature of the events is taken into consideration. Findings The author compares three countries and found out that the correlation between terror and stock markets is almost nil when terror events become a commonplace. Originality/value This paper applies mean reverting stochastic processes to terror incidents and brings out interesting results.
      Citation: Journal of Financial Crime
      PubDate: 2017-11-03T10:25:01Z
      DOI: 10.1108/JFC-07-2016-0049
       
 
 
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