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Purpose The purpose of this study is to review the literature on money laundering and its related areas. The main objective is to identify any gaps in the literature and direct attention towards addressing them. Design/methodology/approach A systematic review of the money laundering literature was conducted with an emphasis on the Pro-Quest, Scopus and Science-Direct databases. Broad research themes were identified after investigating the literature. The theme about the detection of money laundering was then further investigated. The major approaches of such detection are identified, as well as research gaps that could be addressed in future studies. Findings The literature on money laundering can be classified into the following six broad areas: anti-money laundering framework and its effectiveness, the effect of money laundering on other fields and the economy, the role of actors and their relative importance, the magnitude of money laundering, new opportunities available for money laundering and detection of money laundering. Most studies about the detection of money laundering have focused on the use of innovative technologies, banking transactions or real estate- and trade-based money laundering. However, the literature on the detection of shell companies being explicitly used to launder funds is relatively scarce. Originality/value This paper provides insights into an area related to money laundering where research is relatively scant. Shell companies incorporated in the UK alone were identified to be associated with laundering £80bn of stolen money between 2010 and 2014. The use of these entities to launder billions of dollars as witnessed through the laundromat schemes and several data leaks clearly indicate the need to focus on illicit financial flows through such entities.

The Americanization of Shell Oil -- Testing the waters -- Betting on technology -- The trials and triumphs of exploration -- The end of business as usual -- The offshore imperative -- Deepwater treasures in a new era of oil

In recent years, the analysis of economic crime and corruption in procurement has benefited from integrative studies that acknowledge the interconnected nature of the procurement ecosystem. Following this line of research, we present a networks approach for the analysis of shell-companies operations in procurement that makes use of contracting and ownership data under one framework to gain knowledge about the organized crime behavior that emerges in this setting. In this approach, ownership and management data are used to identify connected components in shell-company networks that, together with the contracting data, allows to develop an alternative representation of the traditional buyer-supplier network: the module-component bipartite network, where the modules are groups of buyers and the connected components are groups of suppliers. This is applied to two documented cases of procurement corruption in Mexico characterized by the involvement of large groups of shell-companies in the misappropriation of millions of dollars across many sectors. We quantify the economic impact of single versus connected shell-companies operations. In addition, we incorporate metrics for the diversity of operations and favoritism levels. This paper builds into the quantitative organized crime in the private sector studies and contributes by proposing a networks approach for preventing fraud and understanding the need for legal reforms.

While foreign direct investment (FDI) is generally assumed to represent long-term investments within the real economy, approximately 30-50 percent of global FDI is accounted for by networks of offshore shell companies created by corporations and individuals for tax and other purposes. To date, there has been limited systematic research on the global structure of these networks. Here we address this gap by employing principal component analysis to decompose the global bilateral FDI anomaly matrix into its primary constituent subnetworks. We find that the global offshore FDI network is highly globalized, with a centralized core of jurisdictions in Northwest Europe and the Caribbean exercising a largely homogenous worldwide influence. To the extent that the network is internally differentiated, this appears to primarily reflect a historic layering of social and political relationships. We identify four primary offshore FDI subnetworks, bearing the imprint of four key processes and events: European, particularly UK colonialism, the post-WWII hegemonic alliance between the United States and Western Europe, the fall of Soviet communism, and the rise of Chinese capitalism. We also find evidence of qualitative, but not quantitative, variation in offshore FDI based on national rule of law and communist history.

PurposeThe aim of the paper is to examine the various aspects of the 1MDB scandal including the extent and types of corruption that occurred and the action taken to deal with them. In doing this, the paper seeks to identify the reasons for the scandal and the lessons that can be learnt to avoid such a scandal in Malaysia and elsewhere in the future.Design/methodology/approachThe research for the paper is based on evidence from court hearings, reports of watchdog and regulatory agencies, media reports, and various articles and books written about 1MDB.FindingsThe paper shows that most of the scandal involved embezzlement, bribery, false declarations and bond mispricing relating to extensive borrowing by 1MDB, and entailed a global network of shell companies and individuals through which the illicit money was passed. It also shows weak governance in 1MDB, poor internal controls within banks, the failure of watchdog and enforcement bodies to take the necessary action partly due to political control over them, and overall the lack of political will to deal with the scandal.Originality/valueThe paper builds on the findings of other papers and books written on the 1MDB scandal. It does this by linking the corruption to the borrowings of 1MDB, the international network of money-laundering and bribery through which illicit money flowed, and the poor internal controls in the organisation. It also builds on previous research by highlighting the failure of banks to identify money-laundering and of watchdog and enforcement bodies to deal with the corruption. A further value of the paper is to identify the lessons that can be learnt about combatting corruption on such a scale.

Purpose The purpose of this paper is to study the turnover of Italian shell companies (SCs)/missing traders used for tax crimes, a predicate offence of money laundering. This research could be useful for Italian obliged entities to the Anti-Money Laundering Law to detect and report SCs, as soon as possible, to the Financial Intelligence Unit for Italy. Design/methodology/approach The author uses a sample of 32 SCs that are present in the Third Penal Section of the Italian Supreme Court in the period 2018–2020, involved in tax crimes and that have presented their balance sheets for two or more years. For SCs, the author computes the averages for: the turnover growth rate from first and the maximum turnover; the years between these two values; and the years in which SCs are active. Moreover, the author verifies if SCs are similar in terms of turnover by studying the relationship between the turnover growth rate and the first turnover and the reduction of turnover standard deviations. Findings SCs growth is very high and they reach, on average, their peak in less than three years; SCs are active, on average, for about four years; eventually, SCs exhibit a convergence process in turnover levels. Originality/value To the best of the author’s knowledge, there are no studies that analyse the SC turnover.

Purpose This paper advocates the use of graph database platforms to investigate networks of illicit companies identified in money laundering schemes. It explains the setup of the data structure to investigate a network of illicit companies identified in cases of money laundering schemes and presents its key application in practice. Grounded in the technology acceptance model (TAM), this paper aims to present key operationalisations and theoretical considerations for effectively driving and facilitating its wider adoption among a range of stakeholders focused on anti-money laundering solutions. Design/methodology/approach This paper explores the benefits of adopting graph databases and critiques their limitations by drawing on primary data collection processes that have been undertaken to derive a network topology. Such representation on a graph database platform provides the opportunity to uncover hidden relationships critical for combatting illicit activities such as money laundering. Findings The move to adopt a graph database for storing information related to corporate entities will aid investigators, journalists and other stakeholders in the identification of hidden links among entities to deter activities of corruption and money laundering. Research limitations/implications This paper does not display the nodal data as it is framed as a background to how graph databases can be used in practice. Originality/value To the best of the authors’ knowledge, no studies in the past have considered companies from multiple cases in the same graph network and attempted to investigate the links between them. The advocation for such an approach has significant implications for future studies.

This pitch letter describes the personal application of the pitching tool developed by Faff (2015, 2018) to a potentially academic topic related to money laundering and corruption in the early stages of research. The pitch template aids in the identification of core elements that form the framework for research. The author provides a brief overview of the experience of using the pitch template and its potential applications.

 “. . . tells a dramatic story of imaginative businessmen and engineers who propelled Shell forward in the search for ways to locate and recover oil from the depths of the sea.”—Southwestern Historical Quarterly    “This book clarifies some of the concerns that are specific to a company like Shell and shows how information acquisition and processing provided the company with a tangible competitive advantage.”—Business History Review    “This book’s narrative is sustained throughout by easily understood explanations of the technical details of drilling and production.”—Journal of Southern History