Money Laundering Essay

Anti-Money Laundering / Combating Financing of Terrorism

TABLE OF CONTENTS

EXECUTIVE SUMMARY ...................................................................................................................................... 3 BACKGROUND AND CONTEXT ........................................................................................................................ 4 CHAPTER 1: CURRENT INITIATIVES - MONEY LAUNDERING/ CORRUPTION NEXUS ............... 6 CHAPTER 2: VULNERABILITIES OF AML/CFT REGIMES TO CORRUPTION .................................. 18 CHAPTER 3: POLITICALLY EXPOSED PERSONS, CORRUPTION AND MONEY LAUNDERING........................................................................................................................................................ 34 CHAPTER 4: BEST PRACTICES FOR INTERNATIONAL CO-OPERATION......................................... 54 CHAPTER 5: PRIVATE SECTOR CORRUPTION AND MONEY LAUNDERING................................. 75 CHAPTER 6: RESOURCE AND TRAINING GAPS IN CORRUPTION/ MONEY LAUNDERING ..... 84

ANNEXES Annex 1: Examples of the Money Laundering - Corruption Nexus ................................................................ 91 Annex 2: PEP Money Laundering Case Studies ................................................................................................ 96 Annex 3: Potential Obstacles to the Detection of Bribery of Foreign Public Officials by AML Systems100

EXECUTIVE SUMMARY

1. This Report is provided for the FATF/APG Anti-Corruption/AML/CTF Issue Project Group. It investigates the links between corruption and money laundering, which traditionally have been studied in isolation. Although many multilateral organisations and countries have expressed interest on looking at the money laundering-corruption nexus, apart from this Report there is as yet little systematic research on the topic. 2. Corruption generates more than USD 1 trillion of illicit funds annually which are laundered both...