Shedding Light on Shadow Banking
| Published date | 01 June 2018 |
| Date | 01 June 2018 |
| DOI | 10.1177/0022018318773206 |
| Subject Matter | Articles |
Article
Shedding Light on Shadow
Banking: The Money or Value
Transfer Service Regime
in Australia and Its Origins
Doron Goldbarsht
Macquarie Law School, Australia
Abstract
Excessive regulatory practices to combat anti-money laundering (AML) have the potential to
‘de-bank’ entire regions and deprive certain communities of their participation in traditional
financial markets. While protecting the integrity of the global financial system and shutting
down some illicit activities, this may also facilitate the development of alternative remittance
systems (ARSs) and payment mechanisms, the so-called shadow banking systems, where AML
compliance is not adequate. This article will critically re-examine the relationship between the
overregulation of financial markets and the shift to ARSs. It will propose a new take on ARS to
include illicit activities through an international network of financial institutions and the need
for the regulators to consider a better methodology for detecting ARSs outside the conven-
tional financial sector to deal with this problem.
Keywords
Terrorism financing, Australia, MVTS, FATF
This article focuses on the Australian money or value transfer service (MVTS) regime and the role of the
Financial Action Task Force (FATF), which represents the international standards in counter-terrorism
financing (CTF). The article will fill the gaps existing in the literature by examining the origins and
objectives of MVTS legislation in Australia, and the ways in which the FATF recommendations are
implemented. This approach differs from that of other literature in the field, wh ich deals with the
Australian implementation of the FATF CTF recommendations in general or solely with regard to one
aspect of CTF—the criminalising of the financing of terrorism—without revealing the influence of the
FATF on the Australian regime.
Corresponding author:
Dr. Doron Goldbarsht, Lecturer, Macquarie Law School, Macquarie University, New South Wales, Australia.
E-mail: doron.goldbarsht@mq.edu.au
The Journal of Criminal Law
2018, Vol. 82(3) 264–276
ªThe Author(s) 2018
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DOI: 10.1177/0022018318773206
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