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This paper aims to discuss whether most anti-money laundering (AML) risk assessment strategies within the banking and financial services sector are reactionary focused and/or whether it should be possible to predict where increased costs and resources need to be targeted in future AML risk processes.

The paper reviewed research findings from the researchers own study on trade-based money laundering (TBML) and also survey results from the KPMG Global Anti-Money Laundering Survey (2014), along with academic discussion papers.

The paper concluded that risk assessment strategies were still largely responsive, and this left banks exposed to two factors – not recognising risk that they were not assessing for and, second, being challenged legally as new cases emerged in the court systems from victims of ML and terrorism crimes.

The practical implications affect the resources and costs assigned to risk assessment strategies and called for a more holistic approach that was forward thinking from the bank’s perspective rather than reactionary focused and working from the regulators’s agenda.

Any improvements in detection of AML and counter-terrorism financing has broader social outcomes.

The originality is the subject matter of AML risk assessment strategies and the input from TBML/AML experts from across the globe that contributed to the author’s research survey and interviews. These results have been analysed along with other research and the current academic discussion on this topic.

This paper aims to offer the first known synthesis of peer-reviewed literature on trade-based money laundering (TBML). Given the topic is in its nascent stage yet gaining prominence across scholarship and practice, this foundation is pertinent for future TBML research.

A systematic literature review was undertaken with a formulaic search string. Both qualitative (thematic) and quantitative (meta) analysis methods were used to illustrate the findings.

The systematic literature review, using qualitative and quantitative synthesis, led to a thematic categorization of extant TBML literature into four categories: TBML risk assessment, TBML detection, the role of professionals and understanding of TBML. Due to the limited number of studies, insights that can be drawn from the extant literature on the best way to combat TBML are also limited.

As the first systematic literature review on TBML, this study identified that the existing TBML literature has focused on increasing the understanding of the phenomenon in terms of its definition and mechanisms, detection, linkage with other crimes, such as organized crime and terrorism financing, and risk assessment frameworks. The originality of these findings lies in identifying areas future researchers might explore to broaden the academic literature.

The current emphasis in anti‐money laundering (AML)/ counter terrorist financing (CTF) regulation on “risk‐based” strategies means that regulatory, law enforcement and reporting agencies need to respond to money laundering and terrorist‐financing threats in ways that are proportionate to the risks involved. However, the way that risk is conceptualized remains vague, and the requirements on agencies imposed by the risk‐based approach involve a significant element of uncertainty. The paper addresses these issues.

This paper examines the attributes of risk as it applies to AML/CTF strategy in the context of regulatory risk and related forms of risk assessment, and argues that there are a number of conditions that must be met if risk‐based decision‐making for AML/CTF is to work effectively.

This paper argues that there are a number of conditions that must be met if risk‐based decision‐making is to work effectively. Three of the most important conditions are that there has to be agreement about what risk is being decided on; there must be explicit, quantifiable models of risk, and those responsible for developing and refining risk‐based decision models must have access to knowledge about the outcomes of assessments.

The paper identifies the need for fundamental changes in the relationship between the regulators and the regulated.

The new technology-enabled means to transfer funds or value via crypto assets have prompted regulators and supervisors to question the effectiveness of the anti-money laundering (AML) regulatory framework. This paper aims to examine the recent developments of the EU AML legislation – leading up to the 2021 AML package – focusing in particular on the banks’ internal governance obligations.

The analysis is based on the legal dogmatic methodology and is therefore conducted thanks to a critical exam of the current and upcoming EU policy and legislation, taking into account the relevant literature and case-law.

The recent regulatory developments, culminating in the AML regulation, are strengthening the causal links between ML risk assessment–ML risk exposure–ML risk management, via internal governance procedures. One of the major AML regulatory strategies to react to the new challenges brought up by crypto assets amounts to a stricter and more demanding AML risk management regime imposed on banks.

The originality of this article lies in the analysis of the causal connection between money laundering risk identification and internal governance obligations. In particular, this article examines how the risk assessment will be shaping the organizational procedures, processes and internal functions necessary to manage the money laundering risks.

This paper uses a case study approach using the Permanent Sub Committee on Investigations (PSI) report on HBUS to determine where gaps in anti-money laundering (AML) regulation and compliance are within the banking sector.

The PSI highlighted five areas of serious weakness and fundamental flaws in the HBUS AML risk assessment. This paper examines the governance response that led to these weaknesses and applies a rationale decision-making theoretical framework to explain it.

The report found that corporate culture and attitude at the governance level were key factors in the difficulties that HBUS faced.

This paper focuses on one case, albeit one of the largest banks in the global banking sector. Although generalisations are limited, the report does highlight areas to consider with all banks.

The implications that are identified are aimed at banks and auditing firms that have to work alongside governance structure within banks. The role of internal audit is raised and has future implications for how risk assessment is undertaken and how AML compliance frameworks are devised and reported on.

A stronger social corporate responsibility attitude is suggested that considers the wider social impacts of supporting criminal transactions, even inadvertently, by inappropriate and under-resourced AML risk-assessment frameworks.

The detailed analysis of one case that considers the governance response to AML regulation is new in this paper, and the detailed recommendations for improving and developing stronger AML risk-assessment frameworks apply to the banking, financial services and auditing professions.

This paper attempts to examine the practical condition of implementing risk‐based approach (RBA) in Chinese financial sectors.

This paper compares the differences between rule‐based approach and risk‐based approach (RBA), and provides different options to financial institutions considering their own circumstances.

This paper finds that capacity constraint is an issue for directly transplanting the RBA performed by developed countries to Chinese financial institutions.

This paper creatively proposes a rule‐based but risk‐oriented AML approach or partial RBA that fits Chinese financial institutions' reality underpinned by Chinese culture, and correspondingly, different assessment methods are presented as well.

The purpose of this paper is to present an empirical assessment and outline issues in criminal regulation relating to international anti‐money laundering (AML) programs.

In the first part, this paper outlines the serious threats posed by transnational laundering operations in the context of economic globalization, and calls for highly co‐ordinated international responses to such a crime. The second part of the paper centres on elements of international criminal regulation of ML.

The focus is on the phenomenological aspect of ML and highlights that to a large extent it is an economic issue. Economic analysis calls for an accurate legal response, with typical trade‐offs: it should deter criminals from laundering by increasing the costs for such illicit operations, calling for enhanced regulatory and enforcement activities; however, stronger enforcement yields increased costs and reduces privacy. These features have lately inspired the recent paradigm shift from a rule‐based regulatory framework to a risk‐based approach which still represents an extremely delicate regulatory. Both at the international level and within the single domestic legal system, AML law is typically characterised by a multidisciplinary approach combining the repressive profile with preventive mechanisms: an empirical evaluation of the International Monetary Fund‐World Bank AML program is presented, where these two aspects are assessed. The non‐criminal measures recently implemented under the auspices of the main inter‐governmental public organisations with competence in these fields seem to be consistent with the insights of economic analysis. However, some key criminal issues need to be better addressed.

The paper offers insights into international AML programs, focusing on criminal regulation.

This paper aims to study Saudi Arabia’s approach to combat money laundering and terrorist financing through legislation, regulation and implementation. Saudi Arabia is an integral part of the global economy and energy market. Saudi Arabia is also an important nexus for incoming foreign investment in the region. The country has, for many years, confronted negative exposure on challenging money laundering and terrorist financing. This paper analyses Saudi Arabia’s efforts to maintain international standards of AML/CTF and distinguishes regulatory practice from the existing comments and conjecture on the country’s performance.

The paper uses a qualitative study of Saudi Arabia’s approach to combat money laundering and terrorist financing. The approach is spread across three stages of AML/CTF policy – namely, legislative, regulatory and implementation. Further, the paper also uses independent evaluation to understand Saudi Arabia’s performance in comparison to the international standards of good AML/CTF practice.

The paper finds Saudi Arabia in compliance with international standards of AML/CTF practice. The paper also traces strengthening of AML/CTF-related legislation and regulation in Saudi Arabia over the past two decades. The paper also finds significant evidence that suggests a biased representation of Saudi Arabia’s AML/CTF practices. The factual analysis of Saudi Arabia and its AML/CTF practice is in contradiction of the established discourse on the country’s money laundering and terrorist financing risk profile.

The paper presents a legislative and regulatory analysis of Saudi Arabia’s AML/CTF practice. It is important to understand the implications of injudicious conjecture on Saudi Arabia’s financial strategy to diversify the country’s economy (Mouawad, 2005). Commentators and observers must consider the evidence presented in this paper and reassess the discourse regarding Saudi Arabia’s adherence to international standards of AML/CTF.

Understanding Saudi Arabia’s approach to combat money laundering and terrorist financing is essential to the factors that maintain stability in the Middle East. Saudi Arabia has participated in the region with government forces to maintain stability. The paper examines the overall risk as per international standards, which can be attributed to Saudi Arabia’s AML/CTF profile.

This paper aims to analyze thoroughly all of the sources of research used to develop the money laundering (ML) and terrorist financing (TF) low-risk rating, a rating attained by Norway according to the Basel Institute of Governance, and determine the reasons why Norway is one of only two countries in the world according to the 2012 report, with the other being Estonia, to gain an overall low-risk ML and TF rating.

The differences between the USA and Norway which has obtained a low-risk ranking, were compared and contrasted.

Beginning with the Basel Institute Rating index as a legitimate source for use in assessing anti-money-laundering (AML)/TF risk, and the amount of documentation used in the index’s methodology, it has been proven that the low-risk rating Norway has received is well deserved, and that the US rating of medium risk is also deserved for the time the report was published. Achieving a low-risk rating is not as ambiguous as recently thought and neither is its application on a global scale.

The paper identifies practical areas of improvement and concerns in addressing the overall issue of ML and terrorist financing.

Morocco is an expanding developing economy in North Africa with increasing bilateral trade relations with larger economies. This paper aims to examine the features of the expanding market economy and the preceding structural reforms initiated by King Mohammed VI. The paper’s primary focus is to study the systematic feature of anti-money laundering and combatting of terrorist financing (AML/CTF). Morocco has emerged as a staunch opponent of terrorism and terrorist financing while garnering joint-investigative operations with European countries against transnational organised crime and money laundering.

The paper is divided into two primary series. The first is a view of Morocco’s economy, with a qualitative analysis of significant economic, political and social structural reforms. Second, a qualitative and quantitative analysis of Morocco’s AML and combating of terrorist financing infrastructure is assessed. The qualitative analysis is conducted in two parts; first, by studying the country’s AML/CTF legislation and regulation, and second, by examining the independent international evaluation of the legal structure and its implementation by authorities. The quantitative analysis is conducted by investigating the available statistics relating to money laundering and terrorist financing.

The paper finds Morocco to have accomplished essential economic reforms, especially considering greater institutional management and autonomy. Other structural reforms include the reformation of the constitution, a more comfortable business climate, social development projects focusing on enhancing skill labour and connectivity and the development of strong trade capacity. The primary objective discovery concerns the country’s AML/CTF structure, which is found to comply with international standards. Also, efforts enhancing the country’s regulatory environment with low corruption, low risk of money laundering and low risk of terrorist financing have been taken in a series of legislative amendments and programs. The banking sector and Morocco’s Customs agency have reflected the best improvement as per the study in this paper.

Morocco is witnessing high levels of investment, with year-on-year growth in most existing industrial sectors. The market is also providing for new skilled labour and better trade incentives with the European Union. It is essential for investors, observers and policymakers to understand the market economy reforms and systematic deficiencies in a developing economy. Morocco presents observers with information about policies pre-reform, providing a guide for economic and AML/CTF policy implementation elsewhere.

The paper concerns itself with two levels of analysis concerning Morocco. The first, broad study, is a review of market economy reforms, which are mostly structural and have assisted in the expansion of the economy greatly. The second objective is specific to examining the country’s AML/CTF structure, which has undergone significant development in legislation, regulation and implementation in the past decade. The paper makes a specific attempt to discuss associate indicators to the AML/CTF network as a part of this study.