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Purpose This paper aims to analyze the money laundering process itself, how cryptocurrencies have been integrated into this process, and how regulatory and government bodies are responding to this new form of currency. Design/methodology/approach This paper is a theoretical paper that discusses cryptocurrencies and their role in the money laundering process. Findings Cryptocurrencies eliminate the need for intermediary financial institutions and allow direct peer-to-peer financial transactions. Because of the anonymity introduced through blockchain, cryptocurrencies have been favored by the darknet and other criminal networks. Originality/value Cryptocurrencies are a nascent form of money that first arose with the creation of bitcoin in 2009. This form of purely digital currency was meant as a direct competitor to government-backed fiat currency that are controlled by the central banking system. The paper adds to the recent discussions and debate on cryptocurrencies by suggesting additional regulation to prevent their use in money laundering and corruption schemes.

Efforts to launder money and finance terrorism have been evolving rapidly in recent years in response to heightened countermeasures. The international community has witnessed the use of increasingly sophisticated methods to move illicit funds through financial systems across the globe and has acknowledged the need for improved multilateral cooperation to fight these criminal activities. This second edition is to serve as a single, comprehensive source of practical information for countries to fight money laundering and terrorist financing. It discusses the problems caused by these crimes, the specific actions countries need to take to address them and the role international organizations play in the process. The report is organized as follows: Part A of this Reference Guide describes the problem of money laundering and terrorist financing, their adverse consequences, and the benefits of an effective regime. It also identifies the relevant international standard-setting organizations and discusses their specific efforts and instruments that fight these activities. Part B describes the various elements that are part of a comprehensive legal and institutional framework for anti-money laundering and combating the financing of terrorism for any country. This part of the Reference Guide is a step-by-step approach to achieve compliance with international standards, although it does not dictate the specific methods or actions to be adopted. Rather, it raises the issues that must be addressed and discusses the options that a country has in order to resolve these issues. Part C describes the role of the World Bank and International Monetary Fund (IMF) in the global effort and the coordination of technical assistance available to countries in order to help them achieve compliance with international standards. Each chapter is a self-contained discussion of the topics covered in that chapter with detailed references to background and original source materials. Annexes I, II and III provide complete citations to reference materials.

PurposeThe aim of the present study is to consider the influence of the tensile behavior of fabric and sewing thread on the seam appearance.Design/methodology/approachIn this study, the formation of seam puckering on two elastic and normal woven fabrics was explored. In order to prepare samples, various sewing threads were applied. Test specimens were sewn under five different thread tension levels. Then the appearance of samples was evaluated subjectively to determine their seam puckering grade before and after the laundering process.FindingsThe obtained outcomes of this study present that although sewing thread tension increment decreases the seam pucker ranking in the similar sewing condition, elastic fabrics have a greater seam pucker grade compared to the normal fabric due to the fabric extension and contraction during sewing and after sewing process, respectively. In addition, the elastic strain of the sewing thread is the key factor that determined sewing thread's tendency to make seam puckering. Moreover, the laundry process due to the relaxation of the sewing thread decreases the seam pucker grade.Originality/valueThe consistency of the tensile property of fabric and sewing thread is a crucial parameter in improving the seam appearance and obtaining a smooth seam.

Purpose The purpose of this paper is to explore and evaluate the current legal position on the admissibility of illegally obtained evidence in money laundering cases in Pakistan. Design/methodology/approach A comprehensive exploratory analytical examination indicates that illegally collected evidence from money laundering offences can be considered acceptable as long as it does not compromise the fairness of the judicial process or the right to a fair trial. Findings The admissibility and exclusion of illegally obtained evidence in money laundering cases are primarily governed by the rule of admissibility due to the absence of written or codified regulations in Pakistan. Originality/value The Pakistani Criminal Justice System has always depended on well-established admissibility rules to determine the acceptance or rejection of illegally obtained evidence. For many years, courts have exercised their discretion to allow illegally obtained evidence to be admitted using the relevance test. Additionally, they have also shown their discretion by excluding highly unfavourable material. Illegally obtained evidence may be considered admissible if it is relevant to the matter in issue. Illegally obtained evidence from an act related to illegal actions or a predicate offence in money laundering might impact the prosecution's case and, in turn, protect a defendant's right to a fair trial.

Scholars have highlighted the advantages and risks of transnational regulatory networks for domestic lawmaking. This article examines Australia's adoption of the Financial Action Task Force ('FATF') anti-money laundering and counter-terrorism financing standards. Existing scholarship characterises the FATF as a coercive regime that dictates policy and empowers the executive to implement non-binding transnational standards into domestic law without legislative oversight, thereby precluding democratic participation and contestation. To address such critiques, we analyse the effects of the FATF's peer reviews on domestic legislative deliberation by examining the contributions to a parliamentary inquiry concerning money laundering from government departments and agencies, representatives of regulated entities and professional and civil society actors. Our analysis demonstrates that the FATF's peer review reports have prompted and facilitated, rather than supplanted, local deliberation by providing law reformers with richer evidence and arguments about reform options and their potential effects.

Criminals have become increasingly experienced in using cryptocurrencies, such as Bitcoin, for money laundering. The use of cryptocurrencies can hide criminal identities and transfer hundreds of millions of dollars of dirty funds through their criminal digital wallets. However, this is considered a paradox because cryptocurrencies are goldmines for open-source intelligence, giving law enforcement agencies more power when conducting forensic analyses. This paper proposes Inspection-L, a graph neural network (GNN) framework based on a self-supervised Deep Graph Infomax (DGI) and Graph Isomorphism Network (GIN), with supervised learning algorithms, namely Random Forest (RF), to detect illicit transactions for anti-money laundering (AML). To the best of our knowledge, our proposal is the first to apply self-supervised GNNs to the problem of AML in Bitcoin. The proposed method was evaluated on the Elliptic dataset and shows that our approach outperforms the state-of-the-art in terms of key classification metrics, which demonstrates the potential of self-supervised GNN in the detection of illicit cryptocurrency transactions.

Smurfing in financial networks is a popular fraud technique in which fraudsters inject their illegal money into the legitimate financial system. This activity is performed within a short period of time, with recurring transactions and multiple intermediaries. A major problem of existing graph-based methods for detecting smurfing is that they fall short of retrieving accurate fraud patterns. Consequently, the result is numerous non-fraudulent patterns alongside a few fraud patterns, causing a high false-positive rate. To alleviate this problem, we propose SMoTeF, a framework that extends existing graph-based smurf detection methods by distinguishing fraudulent smurfing patterns from non-fraudulent ones, thus significantly reducing the false-positive ratio. The core of the approach is a novel algorithm based on computing maximum temporal flow within temporal order of events. In order to evaluate the approach, a framework for injecting various smurfing patterns is developed, and experimental results on three real-world datasets from different domains show that SMoTeF significantly improves on the effectiveness of the state-of-the-art baseline, with only marginal runtime overhead.

The study of social violence in Latin America has stood at the periphery of cross-national research despite the region being one of the most violent in the contemporary world. This article provides a comprehensive review of theories of crime and presents an empirical analysis of social violence in Latin America from 1980 to 2010. The literature often emphasizes one theoretical approach over others and existing explanations are seen as competitive rather than complementary. Yet, the empirical findings of this study support different explanations and illustrate how considering different theoretical approaches helps improve our knowledge on social violence phenomena. The results from different estimation methods reveal that youth bulges, female workforce, and post-conflict states are positively associated with social violence, as measured by homicide rates. The results also show that states' efforts to strengthen judicial system capacity and increase school attendance can promote peace. Moreover, while drug producers and/or transit countries are not systematically related to social violence, money-laundering countries experience higher homicide rates, suggesting that not all dimensions of drug-markets increase violence. Whereas Latin America as a whole has experienced few episodes of civil wars in the past decades, the findings suggest that several factors affecting the onset of civil wars also influence other forms of non-political violence such as social violence. This echoes earlier calls in the literature on the necessity of bridging conflict and criminology research.

The fast-paced advances of technology, including artificial intelligence (AI) and machine learning (ML), continue to create new opportunities for banks and other financial institutions. This study reveals the barriers to trust in AI by prudential banking supervisors (compliance with regulations). We conducted a qualitative study on the drivers for adoption of explainability technologies that increase transparency and understanding of complex algorithms (some of the underpinning legal principles in the proposed EU AI Act). By using human-centred and ethics-by-design methods coupled with interviews of the key stakeholders from Eastern European private and public banks and IT AI/ML developers, this research has identified the key challenges concerning the employment of AI algorithms. The results indicate a conflicting view of AI barriers whilst revealing the importance of AI/ML systems in banks, the growing willingness of banks to use such systems more widely, and the problematic aspects of implementing AI/ML systems related to their cost and economic efficiency. Keeping up with the complex regulation requirements comes at a significant cost to banks and financial firms. The focus of the empirical study, stakeholders in Ukraine, Estonia and Poland, was chosen because of the fact that there has been a sharp increase in the adoption of AI/ML models in this jurisdiction in the context of its war with Russia and the ensuing sanctions regime. While the “leapfrogging” AI/ML paths in each bank surveyed had its own drivers and challenges, these insights provide lessons for banks in other European jurisdictions. The analysis of four criminal cases brought against top banks and conclusions of the study indicate that the increase in predicate crimes for money laundering, constantly evolving sanctions regime along with the enhanced scrutiny and enforcement action against banks are hindering technology innovation and legal implications of using AI driven tools for compliance.

Purpose This paper aims to explore the ways in which the international standards in the field of anti-money laundering (AML) and counter-terrorist financing (CTF) have reshaped regulatory regimes in a globalised world. Design/methodology/approach This paper deconstructs the origins and development of international standards in the field of AML and CTF dealing with longstanding legal professional privilege. This paper adopts both qualitative and quantitative research methodologies. The qualitative aspect comprises a literature review of sources, including scholarly works, Financial Action Task Force (FATF) recommendations, reports and domestic laws. The quantitative aspect analyses a unique and comprehensive table reproduced below, that indicates Australia’s compliance with all the FATF recommendations over more than a decade with full alternation to FATF’s revisions of its recommendations. Findings This paper demonstrates that an understanding of the influence of the FATF norms can shed light on the departure from regular lawmaking processes and emerging forms of international governance. The conclusion suggests that tranche II is coming and Australia will amend it in domestic regime to comply with the international standard, applying the AML/CTF regime to the legal profession and thus interfering with legal professional privilege. The question is not if but when. Originality/value This paper fills the gaps in the existing literature by contemplating the future of legal professional privilege globally and in Australia, which provides a case study of a regime that does not yet comply fully with AML and CTF international standard. This approach differs significantly from that of other literature in the field, which deals comprehensively with the theoretical foundations of legal professional privilege, as well as its practicalities and limitations, without considering the influence of the international non-binding norms.