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Article
Publication date: 11 January 2023

Sadia Nazar, Abdul Raheman and Muhammad Anwar ul Haq

This study aims to estimate the amount of money laundering (ML) with multiple proxy approaches and measure the effects of ML on various indicators of the economic and financial…

Abstract

Purpose

This study aims to estimate the amount of money laundering (ML) with multiple proxy approaches and measure the effects of ML on various indicators of the economic and financial sectors. Theoretical justifications are recruited from the parasite theory of organised crime.

Design/methodology/approach

A quantitative research methodology was used on a balanced panel data set to test the study’s hypothesis through generalised method of moment (GMM). The study sample consisted of 77 countries, and the data was collected for 15 years (2005–2019).

Findings

A study has found that 1.23% of global gross domestic product is laundered yearly, and there is no noticeable decline in ML activities. Further study has also found that ML has devastating effects on countries, government revenue, foreign investment, economic development, political and peace conditions, bank liquidity, interest rate volatility and exchange rate volatility. The study has not witnessed the negative consequence of ML on countries’ inflation rates.

Practical implications

Estimates of the study guide policymakers about the volume of resources fleeing and helps them to decide the level of response needed. Further findings help them prioritise the response system according to the area most affected.

Originality/value

This study is an original contribution by the authors and has studied the effects of ML by computing the amount of ML by four different proxies.

Details

Journal of Money Laundering Control, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 5 June 2023

Ahmet Keser, Ibrahim Cutcu, Sunil Tiwari, Mehmet Vahit Eren, S.S. Askar and Mohamed Abouhawwash

The main objective of this research is to investigate if there is a long-term relationship between “terrorism” and sustainable “economic growth” in Big Ten Countries.

Abstract

Purpose

The main objective of this research is to investigate if there is a long-term relationship between “terrorism” and sustainable “economic growth” in Big Ten Countries.

Design/methodology/approach

The data was tested via Panel ARDL Analysis. The growth rate (GR) is the dependent variable, and the “Global Terror Index (GTI)” is the independent variable as the terror indicator. The ratio of Foreign Direct Investment (FDI) to the Gross Domestic Product (GDP), and the ratio of External Balance (EB) to Gross Domestic Product (GDP) are included in the model as the control variables due to their effect on the growth rate. A Panel ARDL analysis is conducted to examine the existence of long-term co-integration between terror and the economy. The planning of the study, the formation of its theoretical and conceptual framework, and the literature research were carried out in 2 months, and the collection of data, the creation of the methodology and the analysis of the analyzes were carried out in 2 months, the interpretation of the findings and the development of policy recommendations were carried out within a period of 1 month. The entire study was completed in a total of 5 months.

Findings

Results showed that “Terror” has a negative impact on “Growth Rate” in the long term while “External Balance” and “Foreign Direct Investment” positively affect the Growth Rate. The coefficients for the short term are not statistically significant.

Research limitations/implications

The sample is only limited to Big Ten including China, India, Indonesia, South Korea, Argentina, Brazil, Mexico, Turkey, Poland and South Africa. The period for annual data collection covers the years between 2002 and 2019 and due to the unavailability of data.

Practical implications

Considering the risks and the mutual negative effect that turns into a vicious circle between terrorism and the economy, it is necessary to eliminate the problems that cause terrorism in the mentioned countries, on the one hand, and to develop policies that will improve economic performance on the other.

Social implications

Trustful law enforcement bodies have to be established and supported by all technological means to prevent terror. The conditions causing terror have to be investigated carefully and the problems causing terror or internal conflict have to be solved. International cooperation against terrorism has to be strengthened and partnerships, information, experience sharing have to be supported at the maximum levels.

Originality/value

It is certain that terror might have a negative influence on the performance of economies. But the limited number of studies within this vein and the small size of their sample groups mostly including single-country case studies require conducting a study by using a larger sample group of countries. Big Ten here represents at least half of the population of the world and different regions of the Globe.

Details

International Journal of Emerging Markets, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 29 June 2022

Meiryani and Dezie Leonarda Warganegara

Efforts to prevent and eradicate the crime of money laundering require a strong legal basis to ensure legal certainty. This paper aims to analyse law enforcement on money…

Abstract

Purpose

Efforts to prevent and eradicate the crime of money laundering require a strong legal basis to ensure legal certainty. This paper aims to analyse law enforcement on money launderers with juridical review perspectives.

Design/methodology/approach

The research method used in this study is the statute approach, which is to examine all laws and regulations related to the crime of money laundering. The writing method used is the normative method, which is a type of research that uses the analysis of certain legislation.

Findings

Three new findings were discovered. In assessing the validity or validation of a business ownership or business transaction, there are at least three pieces of evidence that need to be used, namely, presence/absence of company/business registration in an official government database; the presence/absence (including the amount) of tax reported on income tax and VAT; and the presence/absence of other legal documents relating to the existence or general licensing of a business.

Research limitations/implications

The results of this study are also expected to be helpful for the community, government agencies, or institutions, such as the police, to combat corruption, and money laundering. The Prosecutor's Office and the Corruption Eradication Commission (KPK) describe the handling of money laundering crimes originating from money laundering crimes.

Social implications

This research can provide an overview and input for the broader community as an early warning so as not to commit money laundering crimes.

Originality/value

This is one of the pioneer studies looking into law enforcement on money launderers with comprehensive juridical review.

Details

Journal of Money Laundering Control, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 29 November 2023

Hussain Syed Gowhor

This study aims to evaluate the suspicious transaction reporting (STR) as a financial intelligence tool to identify the potential strengths and limitations of STR and to come up…

Abstract

Purpose

This study aims to evaluate the suspicious transaction reporting (STR) as a financial intelligence tool to identify the potential strengths and limitations of STR and to come up with the criteria, which will make this tool an effective one in early detection of terrorist financing activities.

Design/methodology/approach

Considering the research aim, this research uses the funnelling method for identifying effectiveness criteria. Funnelling is a method of literature review that helps find pertinent literature by refining the search through filtering the available research (Ridley, 2008). Using this method, the researcher first applied the criteria of actionable intelligence to filter the financial intelligence tools to select the most promising and important tool (suspicious transaction reporting) for early detection of terrorist financing activities. The funnelling method was also applied to derive the effectiveness criteria from the operational features, and corresponding limitations, of the suspicious transaction reporting system. The funnelling method was also used to identify those operational features and limitations of suspicious transaction reporting that have the most direct relevance to the early detection problem of suspicious transaction reporting.

Findings

There are some operational features of STR that give rise to certain limitations that undermine its effectiveness in terms of early detection of terrorist financing activities. The limitations of STR necessitate a search for criteria that will make STR effective in early detection of terrorist financing activities. Based on the operational features and their corresponding limitations, effectiveness criteria for STR have been derived in this study. It is shown how these effectiveness criteria can remove the limitations of STR.

Research limitations/implications

The list of operational features and the corresponding limitations based on which the effectiveness criteria have been derived may not be exhaustive. There may have other operational features, and corresponding limitations that also make STR largely ineffective in the early detection of terrorist financing activities, and for which more effectiveness criteria should also be derived.

Practical implications

The limitations and the effectiveness criteria will pave the way for redesigning STR in such a way that will make it highly useful for detecting financing activities relating to imminent terrorist attacks.

Social implications

The society will experience fewer terrorist attacks that will make the society peaceful, happy and vibrant.

Originality/value

In this study, the effectiveness criteria of STR for early detection of terrorist financing activities have been derived in an innovative way by deducing them from the operational features of STR and the corresponding limitations.

Details

Journal of Financial Crime, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1359-0790

Keywords

Article
Publication date: 18 March 2024

Martin David Owens and Elizabeth Johnson

The paper aims to understand how state and non-state domestic terrorism impacts MNEs in foreign markets. Despite the burgeoning literature on terrorism within international…

Abstract

Purpose

The paper aims to understand how state and non-state domestic terrorism impacts MNEs in foreign markets. Despite the burgeoning literature on terrorism within international business (IB), most research has focused on international terrorism, or terrorism generally. Consequently, there has been limited research examining how domestic or local based terrorism impacts foreign firms.

Design/methodology/approach

This is a conceptual paper.

Findings

Domestic terrorism is the most common form of terrorism in the world today and involves the state and non-state actors. Non-state domestic terrorism can be low intensity or high intensity. High intensity non-state-domestic terrorism typically involves regular and protracted political violence, along with inter-communal violence. This can expose MNEs to considerable operational, governance and legitimacy pressures.

Originality/value

The paper contributes to the gap in IB terrorism research with regards domestic or local based terrorism. Drawing on IB theory and critical terrorism research, the paper addresses the nature and impact of domestic terrorism within IB. The authors’ paper shows the operational, governance and legitimacy pressures of both state and non-state domestic terrorism for MNEs in host markets. While most IB scholars consider the threat of non-state terrorism for international firms, this study shows how domestic state terrorism benefits and constrains foreign firms.

Details

Critical Perspectives on International Business, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1742-2043

Keywords

Article
Publication date: 17 January 2024

Peterson K. Ozili

This study aims to investigate the impact of terrorism on financial inclusion that is achieved through automated teller machine penetration and bank branch expansion.

Abstract

Purpose

This study aims to investigate the impact of terrorism on financial inclusion that is achieved through automated teller machine penetration and bank branch expansion.

Design/methodology/approach

Eight countries that are the most terrorized countries in the world were analysed using the panel fixed effect regression model and the generalized linear model.

Findings

The results provide evidence that terrorism reduces the level of financial inclusion in countries experiencing terrorism, but the presence of strong legal institutions, accountability governance institutions and political stability governance institutions mitigate the adverse effect of terrorism on financial inclusion.

Originality/value

A growing literature has shown that terrorism affects the economy, yet little is known about its impact on financial inclusion.

Details

Safer Communities, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1757-8043

Keywords

Article
Publication date: 12 October 2023

Doron Goldbarsht and Katie Benson

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…

Abstract

Purpose

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.

Design/methodology/approach

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.

Findings

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/value

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.

Details

Journal of Financial Crime, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1359-0790

Keywords

Article
Publication date: 3 March 2023

Fabian Maximilian Johannes Teichmann, Sonia Ruxandra Boticiu and Bruno S. Sergi

This study aims to analyze the relationship between financial sustainability and peer-to-peer (P2P) lending platforms.

Abstract

Purpose

This study aims to analyze the relationship between financial sustainability and peer-to-peer (P2P) lending platforms.

Design/methodology/approach

To do so, an extensive literature review on sustainability, FinTech, P2P lending and their associated risks was conducted using a fundamentally theoretical and descriptive methodology.

Findings

In addition, this study shows that finance can accelerate the transition to a low-carbon circular economy by allocating investments in sustainable projects and businesses. Moreover, FinTech P2P lending platforms can help to vitalize green digital finance by using the internet and information technology in the lending market. Nevertheless, anonymous lending and borrowing ventures can produce potential risks such as money laundering, terrorist financing, fraud risk and information asymmetry.

Originality/value

Sustainable finance remains an emerging and relevant area; however, the literature has not sufficiently addressed compliance concerns. To address this gap, this study aims to contribute to the literature by analyzing the link between sustainable finance and P2P platforms and drawing attention to the compliance risks listed above.

Details

Journal of Financial Crime, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1359-0790

Keywords

Article
Publication date: 7 December 2023

Carol Galvin, Aisling Martin, Paige Milburn and Patrick John Kennedy

Factors that may influence risk and/or vulnerability to young people’s involvement in terrorism are currently unclear. Understanding the factors that contribute to a young…

Abstract

Purpose

Factors that may influence risk and/or vulnerability to young people’s involvement in terrorism are currently unclear. Understanding the factors that contribute to a young person’s risk profile is a high priority for Youth Justice Services to enable the development of targeted interventions and subsequent risk reduction. The purpose of this study is to systematically identify and critically review studies relating to young peoples’ involvement in terrorism to understand potential risk and/or vulnerability factors and the implications for intervention.

Design/methodology/approach

Literature was evaluated using the systematic review method. Twelve papers were selected for the systematic review according to the inclusion criteria.

Findings

Twelve factors emerged that indicated relevance to terrorism by young people and were combined into five overarching themes: contextual, social, psychological factors, trauma and use of time.

Originality/value

This systematic review is one of the first of its kind relating to terrorism by young people. The reported findings will be valuable to practitioners seeking to understand the risk and vulnerability factors related to terrorism by young people and the implications for intervention. Directions for future research are explored.

Details

Safer Communities, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1757-8043

Keywords

Article
Publication date: 16 January 2023

Md Badrul Alam, Muhammad Tahir, Norulazidah Omar Ali, Muhammad Naveed Jan and Aziz Ullah Sayal

This paper empirically examines the impact of terrorism on the insurance–growth relationship in the context of Middle East and North Africa (MENA) region, thereby attempting to…

Abstract

Purpose

This paper empirically examines the impact of terrorism on the insurance–growth relationship in the context of Middle East and North Africa (MENA) region, thereby attempting to address the unexplored area in the relevant literature.

Design/methodology/approach

The study considered MENA as it has been one of the terribly affected zones in the world during the study period. Panel data for the period (2002–2017) are sourced from reliable sources for 14 member economies of the MENA region.

Findings

After employing the suitable econometric procedures on the panel data, the results indicate that terrorism appears to have detrimental impact on the observed positive relationship between insurance and economic growth. In addition, trade openness seems to be the main driving force behind economic growth of the selected MENA countries. Surprisingly, the study suggests a negative association between the growth of physical capital and economic growth. Human capital has played a positive but insignificant role in improving economic growth as it is insignificant in majority of the specifications. The growth of labor force has although positively but insignificantly influenced economic growth. Finally, the results demonstrate that government expenditures and high inflation are harmful for growth.

Originality/value

The study investigated the impact of terrorism on the insurance–growth relationship for the first time, and hence policymakers of the MENA region are expected to be benefited enormously from the findings of the study.

Details

Journal of Economic and Administrative Sciences, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1026-4116

Keywords

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