Product Description

Originally developed to reduce drug trafficking, national and international efforts to reduce money laundering have broadened over the years to address other crimes, and most recently, terrorism. These efforts now constitute a formidable regime applied to financial institutions and transactions throughout much of the world. Yet few assessments of either the achievements or consequences of this regime have been made. Reuter and Truman (1) explore what is know about the scale and characteristics of money laundering, (2) describe the current anti–money laundering regime, (3) develop a framework for assessing the effectiveness of the regime, and (4) use that framework to assess how well the current system works and make proposals for its improvement.

Product Details

• Amazon Sales Rank: #254449 in Books
• Published on: 2004-11
• Original language: English
• Number of items: 1
• Binding: Paperback
• 248 pages

Features

• ISBN13: 9780881323702
• Condition: NEW
• Notes: Brand New from Publisher. No Remainder Mark.
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Review
". . . the most comprehensive treatment of money laundering to date." -- Robert E. Litan, Kauffman Foundation

"...the most seminal study ever undertaken of the effectiveness of efforts to deal with the growing threat... of money laundering..." -- Stuart E. Eizenstat, former deputy secretary of the US Treasury

About the Author
Peter Reuter is a professor in the School of Public Affairs and in the Department of Criminology at the University of Maryland. Since July 1999, he has been the editor of the Journal of Policy Analysis and Management. He was a senior economist in the Washington office of the RAND Corporation (1981–93). He founded and directed RAND’s Drug Policy Research Center (1989–93). His early research focused on the organization of illegal markets and resulted in the publication of Disorganized Crime: The Economics of the Visible Hand (MIT Press, 1983), which won the Leslie Wilkins award for the most outstanding book of the year in criminology and criminal justice. He has served as a consultant to numerous government agencies (including the US General Accounting Office, the White House Office of National Drug Control Policy, the National Institute of Justice, and the Substance Abuse and Mental Health Services Administration) and to foreign organizations including the United Nations Drug Control Program and the British Department of Health. He is coauthor of Chasing Dirty Money: Progress on Anti-Money Laundering (2004).

Edwin M. Truman, Senior Fellow at the Institute for International Economics since 2001, was assistant secretary of the Treasury for international affairs (1998–2000). He was staff director of the Division of International Finance of the Board of Governors of the Federal Reserve System (1987–98) and was director of the division from 1977 to 1987. From 1983 to 1998, he was one of three economists on the staff of the Federal Open Market Committee. He has been a member of numerous international working groups on international economic and financial issues. He is the author of Inflation Targeting in the World Economy (2003) and coauthor of Chasing Dirty Money: Progress on Anti-Money Laundering (2004).

Customer Reviews

A discussion of methodologies used to hide revenues
Written by a senior economist and criminology professor along with a former director of the Division of International Finance of the Board of Governors of the Federal Reserve System, Chasing Dirty Money: The Fight Against Money Laundering is a no-nonsense discussion of methodologies used to hide revenues gained from a wide variety of crimes and how to block such assets from being transferred and perpetuated. Chapters clarify laundering mechanisms, from simiply smuggling cash out of the country to using casinos, lotteries, and horse races to lose a little betting but receive clean payoff in issued checks, to taking out single premium insurance policies for which the premium is paid in an upfront lump sum rather than annual installments - then later redeeming these policies at a discount. Further chapters discuss protecting the integrity of financial systems, combating predicate crimes connected to money laundering, confronting such global evils as terrorism and kleptocracy or corruption that rely heavily on money laundering, and much more. A sober, serious-minded resource, an absolute must-read for all economic students and professionals, and an eye-opening revelation for lay readers.

The Dark Side of International Capital Mobility
At a time when a swarm of new books on illicit transactions and dirty money are vying for readers' attention, it is worthwhile to come back to this authoritative study that was published in December 2004 under the auspices of the Institute for International Economics. This book provides the first comprehensive effort to assess the effectiveness of the anti-money laundering (AML) regime, initially put in place to protect the integrity of financial institutions against the abuse of drug lords and criminal traffickers, and which was extended after 9/11 to include the combating of terrorism financing (the whole endeavor now runs under the acronym AML/CFT).

The authors define money laundering as "the conversion of criminal incomes into assets that cannot be tracked back to the underlying crime." Their aim is to begin the task of evaluating the effectiveness of the global anti-money laundering regime. The study describes the phenomenon of money laundering itself, to the extend that the available fragments of information allow, as well as the status of the current AML regime.

This is followed by an analysis of its effectiveness in achieving three goals: reducing crime, protecting the integrity of the core financial system, and controlling three types of global "public bads"--terrorism, corruption, and failed states. The study concludes with recommendations, directed particularly toward the US, on how the AML system and analysis of its effectiveness could both be improved. Unsurprisingly, the authors underscore the dearth of data on the subject, and they end up with a plea that "more research is needed."

The book could have included an analysis of the political economy factors that played a role in the emergence and consolidation of a global anti-money laundering regime. The authors are heavily focused on the US, to which they attribute a leadership role, but they could have mentioned that other countries, such as France, were also instrumental in gathering support for a stronger involvement of the international financial institutions on the prevention side. It is also interesting to note that the banking sector initially resisted increased government interference in its relationship with clients, but that it has since learned how to accommodate AML requirements in ways that impose relatively modest costs and inconveniences on both banks and their customers.

Little has happened since the book was published. As foreseen by the authors, the pace of expansion of the AML regime has slowed and the focus has now shifted to improving global implementation of the current regime. For its part, the US has yet to ratify the UN Convention Against Corruption and to submit itself to a full IMF / World Bank assessment of its financial sector, including regulations affecting money laundering and terrorism financing. The answer to the question: how much money is laundered remains a big question mark.