The Hiding of Wealth: The Implications for the Prevention and Control of Crime and the Protection of Economic Stability
| Pages | 239-243 |
| Published date | 01 March 2002 |
| DOI | https://doi.org/10.1108/eb026022 |
| Date | 01 March 2002 |
| Author | Rosalind Wright |
| Subject Matter | Accounting & finance |
Journal of Financial Crime — Vol. 9 No. 3
The Hiding of Wealth: The Implications for the
Prevention and Control of Crime and the
Protection of Economic Stability
Rosalind Wright
FINANCIAL CRIME AND MONEY
LAUNDERING
In July, a London solicitor was sentenced to seven
years'
imprisonment for laundering £30m, being
the proceeds of drugs and other uncustomed sub-
stances which one of his clients had smuggled into
the country. The judge who sentenced him observed
this was the largest money laundering operation he
had come across. In fact, in 1998, the operator of a
bureau de change in Notting Hill Gate in west
London was sentenced to 14 years in prison for
laundering an even larger sum. It was the fact that
the defendant was a solicitor, that the amounts were
so huge and that he used the respectable front of a
London solicitor's practice for what used to be
called 'receiving', or 'fencing' the proceeds of
crime, that makes this case so notable.
It was not an SFO case; it was prosecuted by
Customs and Excise Solicitor's Department. The
author sees a number of solicitors' names on files
that do arrive at the SFO, however; solicitors who
have worked in some of the most famous and well-
respected firms in the country, who have been
involved, some peripherally but some centrally, in
economic crime; whether as major participants in
the fraud
itself,
or, like this defendant, as launderers
of the proceeds of another's crime.
This should not happen. Each solicitor, each pro-
fessional person, with a professional code of ethics,
never mind their obligation to society through the
law, who involves
himself,
however unwillingly
perhaps at first, at the behest of a criminal client
brings shame on the profession and aids a highly
damaging and now major source of loss to the
economy.
It is not being suggested here that all solicitors,
accountants, bankers and other professionals in the
financial services industry are dishonest. On the
contrary. Again, the evidence suggests that the
overwhelming majority of such people are honest,
upright professionals who are only too willing to
help the SFO, the police and other authorities in
their enquiries. The evidence also suggests that
there are some who are not.
The Financial Action Task Force (FATF) has
pursued a number of countries whose lax controls
and seeming obliviousness to the dangers of launder-
ing the proceeds of crime have made them attractive
destinations for the criminals, gangsters and money
launderers of the world. The FATF campaign,
which names and shames the non-compliant and
threatens worldwide sanctions, has paid off: the
controls in almost all countries singled out for
criticism have been tightened considerably. Eighteen
countries or territories are named in the FATF's 12th
annual report, published in June 2001, as 'non
cooperative'. And only three countries remain1
whose controls do not meet international standards.
There are very few places in the world now where
gangsters can reckon their chances of depositing
dirty money and getting away with it are high.
Those states are the pariah states of the world.
Addressing them, the author would only say that
they are doing themselves no favours. Where there
is laxity, or even more importantly the perception
that there is laxity in controls, in banking and invest-
ment supervision and regulation, money launderers
and criminals will be attracted. And no regime, how-
ever benevolent, wants that sort of business. These are
not the gentleman crooks of 'Raffles' fame; he was a
creation of fiction and should remain there. The sort
of criminals who make use of gaps in banking super-
vision, who take advantage of eyes that are shut to tax
evasion, or of money emanating from drug deals,
prostitution rings or the trafficking in human
beings, will not hesitate to use guns, bombs and any
other means at their disposal to protect themselves
and their cash. Nobody wants to attract that sort of
foreign visitor.
Banking channels are, of course the traditional
route for laundered funds. Casinos and the more
down-market betting shops are another. Other
increasingly popular — and, as yet, uncontrolled
methods for laundering the proceeds of crime are
Journal of Financial Crime
Vol.
9,
No.
3,
2002,
pp.
239-243
© Henry Stewart Publications
ISSN 1359-0790
Page 239
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