Search results

The purpose of this study is to provide a timely synthesis of the empirical literature focusing on the economic consequences of money laundering, as this topic has been gaining momentum among policymakers and academic researchers due to its adverse effects.

Empirical studies are collected by consulting accounting and finance journals in diverse digital sources (e.g. Science Direct, Blackwell, Taylor and Francis, Springer, Sage and Emerald). Key words used to identify relevant papers include “money laundering” and “anti-money laundering regulations,” with specific focus on the economic consequences. Our search strategy includes 24 published papers over the period of 2018–2023.

Findings show that most studies represent cross-country investigations; the main topics investigated focus on accounting field (e.g. audit fees, real and accrual earnings management), tax evasion, financial stability, sustainability, economic indicators (inflation, economic growth, foreign direct investment) and financial inclusion; and the economic consequences of money laundering have been also examined within banking industry (e.g. banking profitability, banking stability). Reported findings of reviewed studies suggest that money laundering has diverse adverse impacts at the country level (e.g. increased tax evasion, higher inflation rate, less sustainability and foreign direct investments), at the firm level (e.g. increased audit risk and aggressive real and accrual earnings management) and within banking industry through negative impact of money laundering on bank’s loan portfolio quality, stability and profitability.

With respect to policymakers, strengthening anti-money laundering regulations may play a critical role in reducing money laundering activities. Furthermore, financial institutions should implement specific rules dealing with anti-money regulations to ensure adequate compliance and disclosure. Finally, policymakers should be aware about the importance of digital transformation to combat money laundering activities since it facilitates the detection of financial crimes due to their traceability.

The summary of the empirical literature focusing on the economic consequence of money laundering represents a historical record and an introduction for accounting researchers. It also urges them to further explore the economic implications of anti-money laundering disclosure within banking industry.

The purpose of this study is to examine the impact of anti-money laundering (AML) regulations on accrual earnings management (AEM) and real earnings management (REM) in Iran’s emerging capital market.

The panel data regression is used to testing hypotheses. The sample includes 2,020 data and 202 companies listed on the Tehran Stock Exchange (TSE) over a period of ten years from 2012 to 2021. Also, the companies covered in this study include financial and nonfinancial companies. Furthermore, the data related to the research variables were extracted from the annual financial statements and the TSE database.

The results show that compliance with AML regulations leads to a reduction in AEM and REM. In other words, companies with higher money laundering (ML) tend to manage their earnings, which is in line with agency theory.

This study has implication for policymakers and regulators, auditors and managers. Considering the negative impact of AML regulations on earnings management (EM), Iranian auditing firms need to emphasize on the full implementation of AML regulations in TSE. Also, the results of this research may aid policymakers and regulators to detect financial crimes through accounting signals.

To the best of the authors’ knowledge, this is the first study in an Iran capital market to examine the impact of AML regulations on EM in financial and nonfinancial companies. Previous research has not controlled for the effects of financial companies. Prior studies have not examined the effects of financial companies. In addition, this study differentiates itself from previous studies by introducing a new method for measuring the independent ML variable based on auditor opinions. The obtained data can aid international bodies to better understand compliance with ML regulations in Iran and can reduce their concerns in negotiations.

Regarding the magnitude of the impact caused by money laundering, the size of the organization and the many parties involved, this paper aims to explore the methods used in detecting money laundering, especially the use of technology.

This research is a literature review from various research sources originating from Pro-Quest, Emerald, Science Direct and Google Scholar.

The researchers found that the most widely used methods for detecting money laundering were artificial intelligence, machine learning, data mining and social network analysis.

This research is expected to help the government or institutions such as the police, forensic accountants and investigative auditors in the fight against money laundering. This research is limited to only a few sources, and it is hoped that further research can explore more deeply related to other methods for detecting money laundering.

This paper discusses the methods that are widely used in detecting money laundering.

This study aims to focus on the legal status of the Financial Action Task Force (FATF) regulatory spread in spite of its limited membership in international law. This is conducted by examining the regime of the FATF with the normative regime of public international law and trying to identify common grounds and conflicts between the two.

This study adopted an exploratory approach involving a thorough examination and analysis of accredited text, command papers and reports, archival materials, national obligations, websites as well as other documentary evidence.

This research gives an empirical determinant of compliance behaviour in response to FATF regulatory standards and the interplay of international law.

The findings here are not exhaustive and could be approached from other perspectives. Researchers are therefore encouraged to engage by testing the findings further, as this is only a blueprint for further research.

This study provides implications for the need to open up the current membership of the FATF, as it appears discriminatory in nature and could inhibit effective compliance with its regulatory standards.

FATF regulatory standards do not just revolve around its members and rule-takers but also affect unintended and vulnerable people who were never in contemplation when these regulations were debated without a global consensus.

The main aim of this study is to advocate for a rethink of FATF’s regulatory strategy by ensuring that its operations are more inclusive, where jurisdictions can participate as members, creating a sense of belonging and commitment in the fight against money laundering.

The purpose of this paper is to examine the extent to which the corporate social responsibility (CSR) law will help combat money laundering in the United Arab Emirates (UAE).

The paper will first focus on examining whether money laundering and CSR are compatible. Such an analysis will then inform decisions on whether to include anti-money laundering in CSR disclosure requirements.

Key findings from the analysis have shown that the UAE CSR law does not explicitly mention money laundering as part of CSR disclosure requirements. Anti-money laundering (AML) and CSR are compatible and convergence, but money laundering is not yet an integral element of CSR disclosure requirements.

There are no clear mechanisms or provisions under the UAE CSR law on how money laundering can be included in CSR disclosure requirements, whether voluntary or mandatory. A pressing challenge now is whether the UAE should regulate AML/combatting the financing of terrorism disclosures under the CSR law. The main concern is that such a move could make mandatory disclosure another technical and regulatory requirement that UAE business must comply, which will be inimical to fostering a strong CSR culture.

Due to their particular nature, virtual assets (VA) are vulnerable to financial crimes such as money laundering and if the appropriate legal mechanisms are not established, this may result in the financial collapse of various economies. To this effect, best practices and standards have been published by some international organisations such as the Financial Action Task Force and IMF which are now domesticated in the national laws of several countries. Therefore, the purpose of this study is to analyse the anti-money laundering (AML) legislative framework in the context of VA in three countries, namely, Mauritius, Japan and South Africa.

To achieve the research objective, the Mauritian AML laws in the context of VA were compared with the corresponding laws of some other countries, namely, Japan and South Africa. As such, a qualitative research method was adopted. In particular, the black letter approach was used to examine the relevant laws of these countries. A comparative analysis was conducted concerning the relevance of AML laws for each country when dealing with VA with the view of suggesting recommendations for Mauritian stakeholders to adopt to enhance the existing AML legal and regulatory framework.

The comparative study conducted has revealed that there are both similarities and divergences among the AML framework of the three countries further to which this research recommends that the Mauritian laws must be amended concerning the duration of information storage on VA, the definition of VA, advertisement by VA service providers and the electronic submission of annual reports. The Mauritian regulatory bodies also need to play a more active role in their joint collaboration to monitor suspicious VA transactions to combat money laundering.

At present, this study will be among the first academic writings on the efficiency of AML laws in the context of VA in Mauritius and also, because existing literature is quite scarce on assessing the adequacy of AML legislation in developing countries, this research aims at filling in the gap in literature. This study is carried out with the aim of combining a large amount of empirical, theoretical and factual information that can be of use to various stakeholders and not only to academics.

The legal profession is vulnerable to abuse for the purposes of money laundering and terrorist financing. According to the Financial Action Task Force (FATF), that vulnerability justified updated global recommendations that urge countries to require lawyers, notaries and other independent legal professionals – including sole practitioners, partners and employed professionals within law firms – to identify, assess and manage the money laundering and terrorist financing risks associated with their services and to ensure that they have appropriate mechanisms in place to provide risk assessment information to competent authorities. Those recommendations proved contentious, with concerns raised by both legal academics and legal professional bodies about the implications of certain aspects of the requirements for the principle of lawyer–client confidentiality. Despite those concerns, many countries have introduced or amended regulatory regimes to extend their application to the legal sector to comply with the FATF’s standards. The purpose of this paper is to contribute to the debate surrounding the extension of AML/CTF obligations to the legal profession.

This paper considers three jurisdictions – the UK, Israel and Australia – at different stages in their journey towards compliance with the FATF’s anti-money laundering (AML) and counter-terrorist financing (CTF) standards for the legal profession. While the UK has a long-established and well-embedded AML regulatory framework for legal professionals, Australia remains non-compliant with the FATF standards. Israel occupies a position between these two ends of the spectrum: following criticism of the omission of lawyers from its AML/CTF regime, Israel implemented due diligence rules for the profession. In 2018, Israel was found to be partially compliant with the relevant FATF recommendations.

It argues that although there are challenges involved, there are also important benefits. Therefore, Australia should act to implement its proposed changes sooner rather than later. Its persistent failure to appropriately address globally recognised areas of vulnerability leaves Australia open to integrity abuse. In addition, if the government delays addressing this issue until pressure from the FATF (such as deadlines for compliance and, if necessary, a finding of non-compliance) forces it to comply, this may tarnish Australia’s reputation, threaten its access to international financial markets and adversely affect the legitimacy and effectiveness of its AML/CTF regime.

Originality in this context refers to the distinctiveness and uniqueness of a paper’s content and approach. In this case, the originality lies in the fact that there is no other existing paper that addresses the topic of three common-law jurisdictions at various stages of their progression towards aligning with the FATF AML/CTF standards, specifically within the context of the legal profession. Furthermore, the timeliness of this paper is underscored by the fact that multiple jurisdictions are currently deliberating their positions on the focus of this paper. This adds to its originality and relevance, as it addresses a gap in the literature while also contributing to the ongoing discourse surrounding compliance with FATF’s standards.

This paper aims to provide authorities managing free trade zones, business enterprises, financial institutions and dedicated free zone customs, police and immigration command assigned to deal with aspects of movement of goods and persons in and out of the free zones with a clear understanding of the cross-border financial crime risks associated with the African Continental Free Trade Area and the risk control measures that combines human intelligence with advanced technology to combat cross-border financial crimes in the African Continental Free Trade Area.

A range of research activities would be used in this study. In addition to a sweeping literature review of academic, official studies and media writings, the main focus is on critically evaluating and analysing primary data by searching and collecting statutes, court cases, administrative rules and regulations and policy documents.

This paper identified bribery and corruption; modern slavery; and trade-based money laundering as the financial crime risks that are of priority concern to African Continental Free Trade Areas and demonstrated how countries can assess and mitigate these risks through adequate policies, procedures and controls including appropriate compliance management arrangement and adequate screening procedures to ensure high standards when hiring employees; corporate transparency; training on managing incidents of modern slavery, forced labour and third-party exploitation; and appropriate monitoring framework for trade-based money laundering activities.

While many authors have written research papers on intra-African trade, none of those research papers explained how countries can assess and mitigate financial crime risks in free trade zones. This research paper describes the ways in which cross-border financial crime risks can be assessed and adequately addressed by the authorities managing free trade zones. This research paper analyses the risk assessment topic in line with the African Continental Free Trade Area with a focus on free trade zones in Nigeria. This research paper would help authorities managing free trade zones, commercial organisations and business enterprises to identify, prevent and mitigate cross-border financial crime risks. Zone managements and business enterprises that implement the risk-based approach, in line with the guidance given in this research paper, will be well-placed to avoid the consequences of inappropriate de-risking behaviour.

The purpose of this paper is to examine the influence that the occurrence of greenwashing has on the consumer perception of corporate social responsibility (CSR).

This paper observed the market indication that a consistent undermining of authentic commitment to CSR taints consumer perception. Investigating how the motivations behind greenwashing contribute to the presentation of CSR was the first means of examining the market forces. Consumer orientation was used as a guiding principle to consider the short- and long-term perspective of a greenwasher.

Individual instances of greenwashing contribute to a collective deterioration of marketplace trust in the promises of CSR. The negative influence on CSR is not isolated to the greenwashing perpetrator but casts a wider effect. The consequences of greenwashing are not isolated but widely dispersed.

Whilst much of the literature focuses on the stigmatisation of individual firms, it is crucial to note how marketplace trust is eroded. In addition, the perception of CSR-related regulations is for example influenced but rarely recognised as a consequence of greenwashing behaviour.

This paper aims to elucidate the practical and theoretical mechanisms which contribute to the perception of an economic sanction’s effectiveness as a foreign policy tool.

This paper is divided into three sections, the first two of which are heavily based on the current academic literature and media presentation of sanctions. The third section is rooted in the empirical approach presented in the first author’s exploratory work, Methods of Money Laundering (2021).

Economic sanctions cannot be perceived as effective when the standard for efficacy remains undefined and sanction circumvention remains feasible. The public perception of sanctions is characterized by a series of assumptions as well as conflict foreign policy objectives, which cultivate an economic theory that is benefited by a practical exploration of the routes of circumvention.

The efficacy of economic sanctions is not a stable equation, but rather the application of an economic tool which is dependent on its context. Paths of sanction circumvention remain open due to weaknesses in compliance regulation. These paths continue to undermine the credibility of sanctions and, ultimately, their efficacy.