In a training session today, someone asked me a question that I have not been asked before – I do love it when that happens. (And before you rush off to your “Big Book of Fiendishly Difficult University Challenge Physics Conundrums”, I mean an AML question, of course.) “Given the amount of dirty money in the world,” he asked, “And the profit made from it by the financial and related sectors, and by extension therefore by governments, do jurisdictions really want to stamp out money laundering – or is it all just for show?” Phew-eee – there’s a man who’s lost his faith in benign government.
But he’s not the only one to question what my late nan used to call the posterior motives of those in charge. (To put it in context, she also called her surprised hairdresser bisexual [rather than unisex] and reckoned that a downpour of rain was a dulage.) In a recent article in the Moscow Times, Russian-born-but-now-US-resident journalist Alexei Bayer made the economic case for money laundering: “The existence of such enormous underground flows [of money] is a fact of life. There has to be some kind of mechanism for accommodating them within the financial system.” Moreover, he argues, the demand by the über-rich for such specialist services should not be ignored: “The new international class of the super-wealthy… requires a special banking system to cater to their needs, including tax avoidance.” Ah yes, let us not forget the poor persecuted tax avoider.
So how did I answer my questioner? Not very helpfully, I fear, with some flannel about living in expectation. But on reflection I suspect that the truth is both more complicated and simpler than that: it varies. Some jurisdictions sincerely wish to get rid of money laundering – from their own shores at least – while others are entirely neutral about money laundering itself (the “money has no smell” school of thought) but realise that refusing to put in place AML legislation is not a wise move on the world stage. Over to you: what would you have said?