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1 – 10 of over 65000Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some…
Abstract
Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.
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In 2019, FIU-the Netherlands celebrated its 25th anniversary. This study takes the occasion to reflect on the role of the FIU in financial surveillance and to describe its core…
Abstract
Purpose
In 2019, FIU-the Netherlands celebrated its 25th anniversary. This study takes the occasion to reflect on the role of the FIU in financial surveillance and to describe its core practices of collecting, analysing and disseminating financial intelligence.
Design/methodology/approach
Because FIU practices are often secret and its transaction data classified as state secrets, the FIU’s daily operational activities remain obscure. Drawing on interviews, public reports and an online training course, this study encircles secrecy and offers a fine-grained analysis of the FIU's core activities.
Findings
The article finds that the FIU plays a pivotal role in financial surveillance because it can operate at various intersections. An FIU operates at the intersection of finance and security, in between the public and private sector and at the national and international domain. This pivotal role makes the FIU indispensable in the surveillance of payment systems and spending behavior.
Social implications
The article poses that the desirability and effectiveness of financial surveillance has to date not received sufficient consideration, while it affects (the privacy of) anyone with a bank account. The article asks: is it ethically justifiable that transaction information is declared suspect, investigated, and shared nationally and internationally, without the individual or entity concerned officially being notified and legally named a suspect?
Originality/value
This case-study is not only relevant for the study of finance/security, AML/CFT and financial surveillance, but also to policy makers and the broader public who merit an understanding of how their financial behaviour is being surveilled.
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Franklin Allen, Xian Gu and Oskar Kowalewski
In this chapter we study the intra-group transactions between the parent bank and its foreign subsidiaries in European Union (EU) countries during the crisis. We use…
Abstract
In this chapter we study the intra-group transactions between the parent bank and its foreign subsidiaries in European Union (EU) countries during the crisis. We use hand-collected data from annual statements on related party transaction and find that they may create a serious problem for the stability of the foreign banks’ subsidiaries. Moreover, as some of those subsidiary banks were large by assets in some of the member states the related party transactions with the parent bank created a serious threat to the host countries’ financial system stability. We attribute this transaction to the weak governance in foreign subsidiaries. We suggest improvements in governance as well as greater disclosure of related party transactions in bank holding companies in Europe.
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Kane J. Smith and Gurpreet Dhillon
Blockchain holds promise as a potential solution to the problem of cybersecurity in financial transactions. However, difficulty exists for both the industry and organizations in…
Abstract
Purpose
Blockchain holds promise as a potential solution to the problem of cybersecurity in financial transactions. However, difficulty exists for both the industry and organizations in assessing this potential solution. Hence, it is important to understand how organizations in the financial sector can address these concerns by exploring blockchain implementation for financial transactions in the context of cybersecurity. To do this, the problem question is threefold: first, what objectives are important based on the strategic values of an organization for evaluating cybersecurity to improve the security of financial transactions? Second, how can they be used to ensure the cybersecurity of financial transactions in a financial organization? Third, how can these objectives be used to evaluate blockchain as a potential solution for enhancing the cybersecurity of organizations in the financial sector relative to existing cybersecurity methods? The paper aims to discuss this issue.
Design/methodology/approach
To accomplish this goal we utilize Keeney’s (1992) multi-objective decision analytics technique, termed value-focused thinking (VFT), to demonstrate how organizations can assess a blockchain solution’s value to maximize value-add within financial organization.
Findings
The presented model clearly demonstrates the viability of using Keeney’s (1992) VFT technique as a multi-criteria decision analysis tool for assessing blockchain technology. Further, a clear explanation of how this model can be extended and adapted for individual organizational use is provided.
Originality/value
This paper engages both the academic literature as well as an expert panel to develop an assessment model for blockchain technology related to financial transactions by providing a useful method for structuring the decision-making process of organizations around blockchain technology.
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Ryan P. Brizek, P. Georgia Bullitt, Rose F. DiMartino, Margery K. Neale and P. Jay Spinola
To describe and analyze a proposed rule recently issued by the US Securities and Exchange Commission (“SEC”) that would overhaul the use of derivatives and financial commitment…
Abstract
Purpose
To describe and analyze a proposed rule recently issued by the US Securities and Exchange Commission (“SEC”) that would overhaul the use of derivatives and financial commitment transactions by registered investment companies and business development companies.
Design/methodology/approach
This article summarizes the various aspects of the proposed rule, discusses the elements of the proposed rule in greater detail, explains the effect of the proposed rule on existing guidance from the SEC and its staff, and notes the potential transition period for any final rule.
Findings
While the proposed rule is subject to public comment and subsequent consideration by the SEC and its staff, if the proposed rule is adopted in its current form it would result in sweeping changes for registered investments companies and business development companies.
Originality/value
This article contains a detailed overview of a recent SEC rule proposal regarding the use of derivatives by registered investment companies and business development companies and practical guidance from experienced asset management lawyers.
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The purpose of this paper is to analyze the obligation of regulated entities to detect unusual and suspicious transactions and to report them to external control bodies, as…
Abstract
Purpose
The purpose of this paper is to analyze the obligation of regulated entities to detect unusual and suspicious transactions and to report them to external control bodies, as established by the Financial Action Task Force (FATF) recommendations, the European Community Directive and also the Spanish regulations for the Prevention of Money Laundering. This research paper also aims to create a model to identify and report suspicious transactions to improve financial institutions’ current procedures.
Design/methodology/approach
According to the Spanish regulations which comply with the FATF recommendations and the European Community Directive on the Prevention of Money Laundering, regulated entities must detect unusual and suspicious transactions. Within this framework, the present research work analyzes both criteria and procedures used by the regulated entities to report suspicious operations. It also assesses the efficiency of the reports sent to an external control body. For this purpose, both analytical and interpretative methods are used in this research paper.
Findings
In Spain, the current procedures followed by regulated entities to analyze unusual transactions are complex. This results in difficulties to report suspicious transactions involving money laundering. As a consequence, the cases of suspicious transactions reported to the external control body are often unclear and the related process is inefficient.
Originality/value
The creation of a harmonized model with the aim of detecting suspicious operations and analyzing them will improve the detection and the effectiveness of the suspicious operations procedure which are reported to the external control body. However, such unified model should take into account the currently used activities proposed by each financial institution.
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Esther Oluwatayo, Evans Osabuohien, Victoria Okafor and Romanus Osabohien
Digital technologies have become significant as organisations, including financial institutions, attempt to adopt enhanced and more efficient approach for service provisions to…
Abstract
Digital technologies have become significant as organisations, including financial institutions, attempt to adopt enhanced and more efficient approach for service provisions to customers. Despite the obvious shift to digitalised methods of service delivery, some financial institutions argued that though digitisation may increase financial efficiency and profitability, it also poses new risks and potential threats with significantly unanticipated side effects, especially, with respect to employment. Against this background, this study examined how the following cashless policy instruments: Mobile banking, Automated Teller Machine (ATM) and Point of Sale (POS) Terminal, influence financial transactions in Lagos, Nigeria; using Zenith Bank PLC as a case study. Structured Questionnaire was administered to 100 Zenith bank customers. The study applied the logit regression method and findings showed that 54% respondents use mobile banking daily, 39% respondents use ATM daily, 25% respondents use POS daily. On an overall scale, mobile banking is widely used and mostly preferred. Also, results showed that while POS has a significant relationship with financial transactions, Mobile banking, and ATM both have an insignificant relationship. Results from the study encourage the management of CBN to create more awareness of these instruments, and likely increase the number of these instruments.
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Maryna Utkina, Roman Samsin and Maksym Pochtovyi
This paper aims to illustrate how virtual assets are used in such criminal offenses as money laundering and seeks to study the role of financial intelligence (monitoring) of…
Abstract
Purpose
This paper aims to illustrate how virtual assets are used in such criminal offenses as money laundering and seeks to study the role of financial intelligence (monitoring) of transactions with virtual assets effectively in combating money laundering.
Design/methodology/approach
This research methodology includes system and structural methods that help analyze the theoretical, organizational and legal bases of the financial intelligence (monitoring) of transactions with virtual assets. The authors use the doctrinal legal research approach to analyze and describe the legislation connected to the financial intelligence (monitoring) operations with virtual assets. To identify critical issues of understanding the “virtual assets” and “cryptocurrency” essence, the peculiarities of the scientific community views on the given definitions, the authors use the method of terminological analysis and concepts operationalization. The authors use the extrapolation method to determine the possibility of implementing the analyzed best practices of foreign countries in the domestic practice of financial intelligence (monitoring) of transactions with virtual assets as an effective way in combating money laundering.
Findings
This study demonstrates the role of financial intelligence (monitoring) of transactions with virtual assets as an effective way to combat money laundering.
Originality/value
The article is devoted to comprehensively studying “virtual assets” and “cryptocurrency” concepts. The authors carried out a comparative analysis of these two concepts with the definition of their features and the main characteristics and features that separate them from each other. The authors also stressed the need for countries to strengthen the requirements for situations and activities with virtual assets, where there is a high level of risk in a risk-based approach.
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Constantin Gurdgiev and Barry Murphy
This chapter presents the results of the comprehensive literature survey and supportive empirical assessment of the potential impacts of the Financial Transactions Tax (FTT…
Abstract
Purpose
This chapter presents the results of the comprehensive literature survey and supportive empirical assessment of the potential impacts of the Financial Transactions Tax (FTT) recently adopted by the European Commission in response to the significant financial sector misallocations arising from the Global Financial Crisis.
Methodology/approach
A survey of 50 academic articles relating to both Financial Transaction Taxes and Tobin Taxes shows that although a reduction in liquidity can be expected from such taxes, the impacts this will have on volatility and efficiency in a market are less obvious. A regression model quantifying what the possible effect of an introduction of a 0.1% tax on financial transactions would be on trading volumes and levels of volatility in the European equity market confirms the survey results in broader terms.
Findings
The results suggest that, in the current economic climate, such a tax would likely increase volatility levels but may not have much effect on trading volumes.
Practical implications
As a result the proposed tax can be viewed as an exercise in revenue generation but not as a macro-prudential tool for addressing potential future shocks and imbalances within the European financial system. In other words, contrary to political and media statements, the FTT does not appear to be an effective tool for addressing past, present and future risks associated with systemic malfunctioning in the banking and financial systems.
Originality/value
The study presents an extensive and systematic survey of academic literature on FTT and links this survey to empirical model estimation. This twin approach to the analysis is novel to the academic and policy literature on Financial Transactions Tax. Whilst popular belief is that introduction of FTT will aid the objective of achieving greater financial and economic sustainability across the European financial systems, evidence presented in this chapter suggests that such a conclusion is at the very best naive.
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Muhannad Ahmed Atmeh and Bassam Maali
The purpose of this paper is to investigate the techniques used by Islamic financial institutions (IFIs) to shift conventional instruments to Shariah-compliant instruments. The…
Abstract
Purpose
The purpose of this paper is to investigate the techniques used by Islamic financial institutions (IFIs) to shift conventional instruments to Shariah-compliant instruments. The paper additionally aims to explore the effect of these techniques on financial reporting.
Design/methodology/approach
The study recognized two techniques used by the IFI: the combination of contracts which compartmentalizes the economic transaction into a series of linked sub-transactions, and the inclusion of donation (Tabarru) in commercial contracts. The paper also reviews the accounting treatment according to the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), and compares it to the concepts adopted by the traditional financial reporting framework concepts (especially substance over form concept).
Findings
With regard to the combination of contracts technique, the major accounting challenge is whether the substance over form concept is considered. Mixed results are found: in some products, the economic substance is presented in the financial reports, while in other cases, the legal form of the contract is reported. This ambiguity may hinder the faithful representation of financial statements. The Tabarru contract is used to justify the risk-shifting practices by Islamic banks. The accounting effects of such contracts may result in failure to recognize assets or liabilities in the financial reports, earnings management and incomplete financial information for the users of the financial reports.
Originality/value
This study is a response to the call raised by the consultative group established by the International Accounting Standards Board. It provides an additional insight into the accounting treatments for a combination of contracts and Tabarru contracts. It also contrasts the accounting treatments, as stipulated by the AAOIFI, with the conventional accounting frameworks.
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