A cost‐effective strategy of implementing international anti‐corruption initiatives. Enhancing the role of anti‐money laundering in combating corruption

Published date28 December 2012
Date28 December 2012
DOIhttps://doi.org/10.1108/13685201311286887
Pages83-90
AuthorLishan Ai
Subject MatterAccounting & finance
A cost-effective strategy of
implementing international
anti-corruption initiatives
Enhancing the role of anti-money laundering
in combating corruption
Lishan Ai
School of Political and Social Inquiry, Monash University, Melbourne, Australia
Abstract
Purpose – The purpose of this conference paper is to provide a contextual and better understanding
of the nexus between corruption and money laundering, in order to enhance the role of anti-money
laundering (AML) in combating corruption.
Design/methodology/approach – This paper analyses the key elements of the linkage between
AML and anti-corruption, and provides Australia and China as examples, demonstrating the potential
importance of using AML to combat corruption.
Findings – It is found that apart from the main financial sectors, designated non-financial sectors
and high-risk customers involved businesses are also vulnerable for money laundering, such as
non-financial designated business and professions, and politically exposed persons. In the meantime,
these factors are regarded as the key points to combat corruption.
Originality/value – This paper highlights the corruption risks hidden in designated non-financial
business and professionals, and the risks of laundering the proceeds of corruption by politically
exposed persons and financially exposed persons (FEPs).
Keywords Australia, China,Corruption, Money laundering,Politically exposed persons
Paper type Viewpoint
1. Leveraging AML program into anti-corruption compliance
Corruption not only produces, but as well protects, money laundering. It would appear
that all stages of the money laundering process – placement, layering and integration –
are present in the laundering of proceeds regardless of the manner of corruption. In
appreciation of the importance to combat corruption, several global, regional and
national legislative and enforcement initiative have merged from the 1980s to combat
this issue. Major milestones in the fight against corruption include the International
Chamber of Commerce (ICC) “Rules of Conduct to Combat Extortion and Bribery”,
the OECD “Convention on Combating Bribery of Foreign Public Officials” (1997), “the
United Nations Convention against Corruption (UNCAC) (2003)”, “Stolen Asset
Recovery (StAR) Initiative (2007)”, Transparency International (TI), the United Nations
Global Compact (GC), and the World Economic Forum partnering against corruption
initiative (PACI).
More recently there is a growing realization that, rather than representing separate
problems, money laundering and corruption may be linked. It is assumed that the
strategies in place to combat one kind of crime may be effective in reducing the other
(Sharman and Chaikin, 2009, p. 30).
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1368-5201.htm
International
anti-corruption
initiatives
83
Journal of Money Laundering Control
Vol. 16 No. 1, 2013
pp. 83-90
qEmerald Group Publishing Limited
1368-5201
DOI 10.1108/13685201311286887

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