The impact of national culture on financial crime

Pages373-387
DOIhttps://doi.org/10.1108/JMLC-01-2018-0004
Date07 May 2019
Published date07 May 2019
AuthorAhmed Yamen,Anas Al Qudah,Ahmed Badawi,Ahmed Bani-Mustafa
Subject MatterAccounting & Finance,Financial risk/company failure,Financial compliance/regulation,Financial crime
The impact of national culture
on nancial crime
Ahmed Yamen
Department of Accounting, Ain Shams University,
Faculty of Commerce, Cairo, Egypt and Department of Accounting,
American University of the Middle East, Kuwait
Anas Al Qudah
Department of Finance, Yarmouk University, Jordan
Ahmed Badawi
American University of the Middle East, Riyadh, Saudi Arabia, and
Ahmed Bani-Mustafa
Department of Mathematics, Australian College of Kuwait, Kuwait
Abstract
Purpose Despite the existence of laws, regulations and sanctions, nancial crime remains widespread.
The Panama leakshave proven that people from all over the world areparticipating in money laundering and
other nancial crimes. This study aims to investigate the inuence of national culture on nancial crimes
across 78 countries.
Design/methodology/approach This study uses Hofstedes cultural framework as a basis for its
hypotheses on nancial crime.It also uses the Basel anti-money laundering indexas a proxy for measuring
the incidenceof nancial crime across the countries under review.
Findings The ndings show that countries whose cultural proles are characterized by low
uncertainty avoidance, low individualism, high masculinity and low long-term orientation have high
rates of nancial crime. The nding also shows that countries whose cultural proles are characterized
by individualism or positive collectivism, uncertainty avoidance and long-term orientation have low
rates of nancial crime.
Originality/value Laws, regulations and sanctions are not the only factors that can help deter the
crime; governments should also take a holistic approach that includes the cultural factors that
encourage deterrence.
Keywords Individualism, Power distance, Long-term orientation, Financial crime, Masculinity,
Uncertainty avoidance, Indulgence, Money laundry
Paper type Research paper
1. Introduction
Financial crime is a serious issue all over the world. This is particularly so in the case of
international terrorism, which continues to increase in both its occurrence and
geographic spread. Acts of terrorism raise questions regarding the sources of nance,
and also how terrorists are able to give legitimacy to the gains achieved from their
illegal acts. These and other questions about nancial crime have led scholars to
increasingly focusing on nancial crimes, in general and on money laundering, in
particular, in their attempts to nd the reasons behind these acts and whether legal
sanctions and regulations are sufcient in deterring these types of crime or whether
The impact of
national
culture
373
Journalof Money Laundering
Control
Vol.22 No. 2, 2019
pp. 373-387
© Emerald Publishing Limited
1368-5201
DOI 10.1108/JMLC-01-2018-0004
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1368-5201.htm

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