Discuss how emerging technologies and globalisation contribute to money laundering. Elaborate measures to tackle the problem of money laundering both at national and international levels.

Globalization of economies along with the ICT revolution is leading to increased financial cyber crimes resulting in Cyber laundering.

Technologies contributing to Money Laundering –

• Crypto-Currency – outside control of the financial system.
• Social Media – Use of Radical ideologies to collect money.
• Identity Theft – Financial information is obtained by Phishing.
• Online Gambling and lottery scams
• Business Email Compromise – prompted to transfer money to legitimate looking accounts.

Globalization and Money Laundering –

• International Wire Transfer Fraud – Emails are hacked to send instructions to banks to transfer money.
• International nature of Organized crimes and lack of regulation.
• Round tripping & Tax Havens  – circulation of money across jurisdictions. Ex – Cayman island
• Trade-based money laundering (TBML) – using Transfer Mispricing.

MEASURES

National –

• Prevention of Money Laundering act amended in 2019.
• Enforcement directorate empowered.
• Special courts.
• Formalization and digitisation of Economy.

International –

• International Money – Laundering Information Network – assists law enforcement agencies.
• Financial Action Task Force on Money Laundering (FATF) – Global standards.
• United Nations Office of Drugs and Crime
• Financial intelligence units and Egmont group – exchange of information between financial services institutions.

Money laundering poses a threat to the economic integrity of the country, hence it should be tackled by International as well as national efforts.