Money Laundering Blacklists

The criteria used by Financial Action Task Force (FATF) and the European Union to blacklist jurisdictions at high-risk of money laundering are discussed in this book, along with the countries at highest risk according to the Panama Papers and FinCEN files. It also explores where criminals move their illicit money and the weaknesses and myths behind the current ratings.

Format: Hardback
Length: 170 pages
Publication date: 31 January 2022
Publisher: Taylor & Francis Ltd

The Financial Action Task Force (FATF) and the European Union have established criteria to identify jurisdictions at high risk of money laundering. These criteria are based on a comprehensive assessment of various factors, including the strength of anti-money laundering (AML) regulations, the effectiveness of law enforcement agencies, and the level of financial transparency. Countries that are deemed to pose a high risk of money laundering are subject to targeted measures and restrictions by these organizations.

According to the Panama Papers and FinCEN files, several countries are at high risk of attracting money laundering and organized crime proceeds. These countries are often referred to as "tax havens" or "offshore financial centers" because they offer a favorable regulatory environment and lack effective AML controls. Some of the countries at highest risk according to these sources include:

Bahamas: The Bahamas is a popular offshore financial center that has been criticized for its lack of transparency and effective AML controls. The country has been identified as a jurisdiction of concern by the FATF and the European Union.

Panama: Panama is another country that has been implicated in the Panama Papers. The country has been known for its lax AML regulations and its role in facilitating offshore financial transactions.

Cyprus: Cyprus is a popular offshore financial center that has been criticized for its weak AML controls and its role in facilitating tax evasion. The country has been identified as a jurisdiction of concern by the FATF and the European Union.

Luxembourg: Luxembourg is a small country with a highly developed financial sector. The country has been criticized for its lack of transparency and effective AML controls, particularly in the banking sector.

Virgin Islands: The Virgin Islands are a British overseas territory that has been criticized for its lack of effective AML controls and its role in facilitating offshore financial transactions.

Once criminals have obtained illicit money, they often move it through a complex network of financial transactions and institutions to obscure its origin and make it difficult to trace. The methods used for money laundering vary depending on the type of crime, the location, and the level of sophistication of the criminal organization. However, some common methods include:

Banking: Criminals may use banks and financial institutions to move illicit money by opening accounts and making transactions. Banks may be complicit in money laundering if they fail to implement adequate AML controls or if they are used as a front for criminal activities.

Cryptocurrency: Cryptocurrencies such as Bitcoin have gained popularity in recent years as a means of moving illicit money. Criminals may use cryptocurrency exchanges and wallets to buy and sell cryptocurrencies, and they may also use them to transfer funds between different countries.

Money transfer services: Money transfer services such as Western Union and MoneyGram are often used by criminals to move illicit money. These services may be used to transfer funds between different countries without the need for a bank account.

Real estate: Criminals may use real estate transactions to move illicit money. For example, they may buy properties in high-value areas and then sell them for a profit, or they may use real estate to launder money through shell companies.

Investments: Criminals may use investments such as stocks, bonds, and real estate to move illicit money. They may use offshore accounts and shell companies to conceal their ownership of these assets.

It is important to note that the methods used for money laundering are constantly evolving, and it is difficult for law enforcement agencies to keep up with the latest techniques. This is why it is essential for banks, financial institutions, and other stakeholders to implement robust AML controls and to cooperate with law enforcement agencies to combat money laundering.

In conclusion, the criteria used by the Financial Action Task Force (FATF) and the European Union to blacklist jurisdictions at high risk of money laundering are based on a comprehensive assessment of various factors. Countries that are deemed to pose a high risk of money laundering are subject to targeted measures and restrictions by these organizations. According to the Panama Papers and FinCEN files, several countries are at high risk of attracting money laundering and organized crime proceeds, including the Bahamas, Panama, Cyprus, Luxembourg, and the Virgin Islands. Criminals move illicit money through a complex network of financial transactions and institutions, using methods such as banking, cryptocurrency, money transfer services, real estate, and investments. It is essential for banks, financial institutions, and other stakeholders to implement robust AML controls and to cooperate with law enforcement agencies to combat money laundering.

Weight: 503g
Dimension: 234 x 156 (mm)
ISBN-13: 9781032080871