Milind Tiwari - Academia.edu (original) (raw)

Papers by Milind Tiwari

Research paper thumbnail of The cryptocurrency conundrum: the emerging role of digital currencies in geopolitical conflicts

Journal of financial crime, Mar 21, 2024

Research paper thumbnail of The implications of national blockchain infrastructure for financial crime

RePEc: Research Papers in Economics, 2023

Research paper thumbnail of Trade-based money laundering: a systematic literature review

Journal of Accounting Literature, Jan 7, 2024

Research paper thumbnail of Weeding Out Dirty Money: Cannabis Regulations and Financial Crime

Research paper thumbnail of Factors influencing the choice of technique to launder funds: The APPT framework

This paper proposes a new framework to provide insights into the techniques launderers adopt to c... more This paper proposes a new framework to provide insights into the techniques launderers adopt to clean illicit funds, drawing on existing literature and theories including rational choice, public value, structural coupling, and stakeholder. The proposed APPT framework is named after four factors that explain the choice of techniques: the Actors involved, Predicate crime, the Purpose of laundering, and Technological innovations. While the current literature on money laundering primarily directs attention toward aspects such as regulatory frameworks, the stages of money laundering, and ways of detecting it, there is a lack of understanding about the reasons underlying a launderer's choice of techniques. This paper endeavors to reduce this gap in the literature and contribute to understanding the motivation of money launderers for the benefit of investigations. The framework offers new insights for the money laundering literature and has implications for neophytes, practitioners, and institutions teaching financial crime.

Research paper thumbnail of The implications of national blockchain infrastructure for financial crime

Journal of Financial Crime

Purpose This paper aims to explain the implications of the impending establishment of national bl... more Purpose This paper aims to explain the implications of the impending establishment of national blockchain infrastructure by governments around the world, and how these structures can be integrated with existing legislation and assist in the prevention of financial crime. Design/methodology/approach The methodology used is a literature review and analysis of progress being made to establish national blockchain infrastructure. It provides a discussion of the connection between blockchain and financial crime, and how this infrastructure will interact with existing regulatory frameworks, and particularly, financial crime legislation. Findings This paper documents financial crime risks posed by digital currencies and smart contracts and the role that national blockchain infrastructure can potentially play in mitigating these risks. It highlights the need for governments to devote resources to developing this infrastructure and associated regulatory frameworks. Originality/value There are...

Research paper thumbnail of Factors influencing the choice of technique to launder funds: The APPT framework

Journal of Economic Criminology

Research paper thumbnail of The role of virtue ethics in enhancing reputation through combatting financial crimes

Journal of Money Laundering Control, Apr 14, 2023

Research paper thumbnail of Preempting fraud: a financial distress prediction perspective on combating financial crime

Journal of Money Laundering Control, Apr 7, 2023

Research paper thumbnail of Food crime: An often-ignored money laundering typology and a predicate crime

Journal of Economic Criminology

Research paper thumbnail of Fantasy Pitching V: Doraemon, Handshaking, Spiders, Misery

SSRN Electronic Journal, 2018

Fantasy Pitching V follows in the footsteps of four earlier fantasy pitching exercises: Faff, Ali... more Fantasy Pitching V follows in the footsteps of four earlier fantasy pitching exercises: Faff, Ali, et al. (2016); Faff, Wallin et al. (2016); Faff, Carrick, et al (2017) & Faff, Baladi, et al (2017). Like all prior versions, the current paper challenges teams of novice researchers to use the framework of Faff’s (2015, 2017a) pitching research template, in a time constrained setting, to pitch fictitious research projects. The contexts reported in the current paper come four different settings: (a) a PhD course run at the University of Economics, Prague (April 2017); (b) UQ Summer Research Scholar cohort, 2017-18; (c) AFDEN and, (d) FIRN PhD courses on the “Research Process”. The fantasy application of the “pitching” approach provides a low stress environment for appreciating and exploring the underlying philosophy of the pitching research tool. Herein, we share the fruits of thirteen fantasy teams relating to: (a) Handshaking habits I; (b) Handshaking habits II; (c) Warm ice-cream; (d) Misery vs. happiness; (e) income equality; (f) Air pollution; (g) Divorce; (h) Doraemon; (i) Toupee power; (j) Lego; (k) Spiders; (l) Fashion; and (m) Crime.

Research paper thumbnail of Evolution of cannabis regulations and their overlooked link with money laundering: Australia as a critical case study

Journal of Money Laundering Control

Purpose The purpose of this paper is to interrogate if the legal status of a cannabis affects mon... more Purpose The purpose of this paper is to interrogate if the legal status of a cannabis affects money laundering activity. The legal status of cannabis continues to evolve globally; at the same time, its market remains enormous. Much of this market represents dirty money from criminal acts, which often requires laundering. In the context of changing cannabis regulations, legislation, and policies, the authors propose the possible implications such changes may have on the extent of money laundering. Design/methodology/approach This paper proposes the implications of the evolution of cannabis regulations on money laundering activities, using the theoretical underpinning of rational choice. Using Australia as a replicable critical case study, the paper, using the Walker gravity model and using United Nations Office on Drugs and Crime-reported prices of cannabis from 2003 to 2017 and Australian Criminal Intelligence Commission reports empirically validates the effects of cannabis regulati...

Research paper thumbnail of Money Laundering: Facets associated with detection and magnitude of the problem

Link to publication General rights Copyright and moral rights for the publications made accessibl... more Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal.

Research paper thumbnail of Using graph database platforms to fight money laundering: advocating large scale adoption

Journal of Money Laundering Control

Purpose This paper advocates the use of graph database platforms to investigate networks of illic... more 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 launderi...

Research paper thumbnail of Shell Companies: Using a hybrid technique to detect illicit activities

2021 Accounting and Finance Association of Australia and New Zealand (AFAANZ) Virtual Conference, Jul 6, 2021

Shell companies can be used to launder dirty money to make it appear legitimate and hide informat... more Shell companies can be used to launder dirty money to make it appear legitimate and hide information about the actual beneficial owners. Illegal arms dealers, drug cartels, corrupt politicians, terrorists and cyber-criminals have become some of the frequent users of shell companies. This study aims to develop a model for detecting shell companies being used to launder illicit proceeds of crime using a new hybrid statistical approach. Using a combination of graph algorithms and supervised learning, detection models with classification accuracy ranging between 88.17% and 97.85%, were developed to detect illicit entities. To the best of our knowledge, no prior study exists on developing quantitative models to detect illicit shell companies using publicly available information. The key stakeholders to benefit from such models would be legal and compliant professionals and government officials, especially accountants, tax officials and anti-corruption NGOs. • The paper uses various combinations of similarity, communitydetection and centrality algorithms (namely, Jaccard Index, Overlap Index, Triangles and Triangle Counting Algorithm, Betweenness Centrality, Approximate Betweenness-Centrality and Harmonic Centrality algorithm). • The results showed that on using three classification algorithms, namely Decision Trees, TreeNet, and Random Forests, for the combination of various graph algorithms, the classification accuracy achieved was within the range of 88.17 % and 97.85 %, respectively. • The performance of these algorithms was regarded using different performance metrics like Area under ROC (AUC), precision, recall and F-value. The scores obtained using various combinations of graph algorithms were used for the classification models to compare the performance and determine whether the classification accuracy is consistent across them. The literature is consistent with use of these measures to evaluate performance (Kute et al. 2021). The lack of any work in the academic literature on detection of shell companies using publicly available information prohibits comparison to evaluate the performance of the present methodology. However, the present work lays down a benchmark for comparison for future studies. • This study has implications for anti-corruption NGOs, corporate registries, financial institutions, government officials, legal and compliance professionals, especially tax-officials and accountants. For anti-corruption NGOs, corporate registries and government officials, such a model would suggest a move towards the incorporation of graph database platform aimed at identifying hidden relationships between entities. For financial institutions with access to transaction information, use of such detection models would aid in filing Suspicious Activity Reports (SARs). The role of accountants is vital in reporting money laundering activities (Mitchell, Sikka, and Willmott 1998b) and use of such models would help them continue to do so.

Research paper thumbnail of Money Laundering Ranking the Countries Attractive for Money Laundering to India

Online International Conference on 'Emerging Opportunities and Challenges in Indian Economy: An Interdisciplinary Approach, Oct 1, 2020

Purpose: This paper estimates the order in which other countries are an attractive destination fo... more Purpose: This paper estimates the order in which other countries are an attractive destination for money laundering to India and determines the proportion that will be laundered to those countries. Methodology: The paper involves the use of Walker's Gravity Model, initially proposed by Walker (1999) and then updated by Unger (2006) to determine the countries attractive for money laundering to India. The paper uses information on GDP per capita, banking secrecy, government attitude, swift information, financial deposits, conflict, corruption, and Egmont group member for 150 countries from 2002 to 2014 to come up with how attractive a country is for money laundering. Then, using distance information of countries from India, the proportion of funds that would be laundered to the countries attractive to India for money laundering is computed. Findings: The analysis finds that countries preferred for laundering money from India are countries characterized by a strong economy and sound financial standing. Research Implications: The paper directs attention towards focusing on the need to curb money laundering in the Indian context and determine the possible destinations where money generated in the economy might be flowing. Practical Implications: This paper takes steps in the fight against money laundering by directing attention towards the destination attractive for money laundering to India. Originality: No studies in the past have considered money laundering flows from India.

Research paper thumbnail of Case of the empty crates: Finding a solution to letter-of-credit fraud

Fraud Magazine, Nov 1, 2021

Research paper thumbnail of Shell companies – Identification of an instrument used for illicit purposes: A Pitch

Journal of Accounting and Management Information Systems, 2018

Research paper thumbnail of Can economic sanctions lead to fraud?: Nations might turn to virtual currencies if slapped with restrictions

Can economic sanctions lead to fraud? Nations might turn to virtual currencies if slapped with re... more Can economic sanctions lead to fraud? Nations might turn to virtual currencies if slapped with restrictions Countries routinely use sanctions on nations to deter and penalize bad behavior. But what if economic restrictions cause criminals to see the anonymity of alternative currencies? We possibly could see increases in fraud, money laundering and terrorism financing. Or not. The jury's still out. Here's what fraud examiners and law enforcement can do as nations move to their own parallel virtual and traditional monetary systems. By Milind Tiwari, CFE; Adrian Gepp, Ph.D., ACFE Educator Associate; and Kuldeep Kumar, Ph.D., ACFE Educator Associate The perpetrator of an $80 million Ponzi scheme needed to launder his dirty money, so he funneled the cash through a Denver online virtual currency exchange backed by established American venture-capital firms, according to a recent Wall Street Journal investigation. (See "How Dirty Money Disappears Into the Black Hole of Cryptocurrency," by Justin Scheck and Shane Shifflett, The Wall Street Journal, Sept. 28, 2018, tinyurl.com/ycpo6j8d.) Governments and law enforcement agencies have long been concerned that virtual currencies can help facilitate money laundering, fraud and terror financing. They've believed that virtual currencies' anonymity and the absence of middlemen make them attractive instruments to finance crimes with ease. But is this concern justified? The debate continues. One school of thought views virtual currencies as an effective terror-funding tool, for example. But another perceives them as ineffective

Research paper thumbnail of Global money laundering appeal index: application of principal component analysis

Journal of Money Laundering Control, 2021

Purpose The paper aims at developing a global ranking system determining a country's appeal a... more Purpose The paper aims at developing a global ranking system determining a country's appeal as a destination for money laundering. Design/methodology/approach This paper uses principal component analysis (PCA), with a mix of standardised and unstandardised components relating to attractiveness, economic freedom and money laundering risk to come up with an index of money laundering appeal. Findings Four components relating to economic feasibility, financial liberty, government spending and tax regime are critical in influencing a country's money laundering appeal. Research limitations/implications This paper attempts to use a standardised and replicable methodology to condense into a single measure the complex and multifaceted phenomenon of a country's appeal as a destination for money laundering, thus avoiding the difficulty associated with precisely calculating illicit financial flows. Practical implications The ranking system could be used to determine the destinations...

Research paper thumbnail of The cryptocurrency conundrum: the emerging role of digital currencies in geopolitical conflicts

Journal of financial crime, Mar 21, 2024

Research paper thumbnail of The implications of national blockchain infrastructure for financial crime

RePEc: Research Papers in Economics, 2023

Research paper thumbnail of Trade-based money laundering: a systematic literature review

Journal of Accounting Literature, Jan 7, 2024

Research paper thumbnail of Weeding Out Dirty Money: Cannabis Regulations and Financial Crime

Research paper thumbnail of Factors influencing the choice of technique to launder funds: The APPT framework

This paper proposes a new framework to provide insights into the techniques launderers adopt to c... more This paper proposes a new framework to provide insights into the techniques launderers adopt to clean illicit funds, drawing on existing literature and theories including rational choice, public value, structural coupling, and stakeholder. The proposed APPT framework is named after four factors that explain the choice of techniques: the Actors involved, Predicate crime, the Purpose of laundering, and Technological innovations. While the current literature on money laundering primarily directs attention toward aspects such as regulatory frameworks, the stages of money laundering, and ways of detecting it, there is a lack of understanding about the reasons underlying a launderer's choice of techniques. This paper endeavors to reduce this gap in the literature and contribute to understanding the motivation of money launderers for the benefit of investigations. The framework offers new insights for the money laundering literature and has implications for neophytes, practitioners, and institutions teaching financial crime.

Research paper thumbnail of The implications of national blockchain infrastructure for financial crime

Journal of Financial Crime

Purpose This paper aims to explain the implications of the impending establishment of national bl... more Purpose This paper aims to explain the implications of the impending establishment of national blockchain infrastructure by governments around the world, and how these structures can be integrated with existing legislation and assist in the prevention of financial crime. Design/methodology/approach The methodology used is a literature review and analysis of progress being made to establish national blockchain infrastructure. It provides a discussion of the connection between blockchain and financial crime, and how this infrastructure will interact with existing regulatory frameworks, and particularly, financial crime legislation. Findings This paper documents financial crime risks posed by digital currencies and smart contracts and the role that national blockchain infrastructure can potentially play in mitigating these risks. It highlights the need for governments to devote resources to developing this infrastructure and associated regulatory frameworks. Originality/value There are...

Research paper thumbnail of Factors influencing the choice of technique to launder funds: The APPT framework

Journal of Economic Criminology

Research paper thumbnail of The role of virtue ethics in enhancing reputation through combatting financial crimes

Journal of Money Laundering Control, Apr 14, 2023

Research paper thumbnail of Preempting fraud: a financial distress prediction perspective on combating financial crime

Journal of Money Laundering Control, Apr 7, 2023

Research paper thumbnail of Food crime: An often-ignored money laundering typology and a predicate crime

Journal of Economic Criminology

Research paper thumbnail of Fantasy Pitching V: Doraemon, Handshaking, Spiders, Misery

SSRN Electronic Journal, 2018

Fantasy Pitching V follows in the footsteps of four earlier fantasy pitching exercises: Faff, Ali... more Fantasy Pitching V follows in the footsteps of four earlier fantasy pitching exercises: Faff, Ali, et al. (2016); Faff, Wallin et al. (2016); Faff, Carrick, et al (2017) & Faff, Baladi, et al (2017). Like all prior versions, the current paper challenges teams of novice researchers to use the framework of Faff’s (2015, 2017a) pitching research template, in a time constrained setting, to pitch fictitious research projects. The contexts reported in the current paper come four different settings: (a) a PhD course run at the University of Economics, Prague (April 2017); (b) UQ Summer Research Scholar cohort, 2017-18; (c) AFDEN and, (d) FIRN PhD courses on the “Research Process”. The fantasy application of the “pitching” approach provides a low stress environment for appreciating and exploring the underlying philosophy of the pitching research tool. Herein, we share the fruits of thirteen fantasy teams relating to: (a) Handshaking habits I; (b) Handshaking habits II; (c) Warm ice-cream; (d) Misery vs. happiness; (e) income equality; (f) Air pollution; (g) Divorce; (h) Doraemon; (i) Toupee power; (j) Lego; (k) Spiders; (l) Fashion; and (m) Crime.

Research paper thumbnail of Evolution of cannabis regulations and their overlooked link with money laundering: Australia as a critical case study

Journal of Money Laundering Control

Purpose The purpose of this paper is to interrogate if the legal status of a cannabis affects mon... more Purpose The purpose of this paper is to interrogate if the legal status of a cannabis affects money laundering activity. The legal status of cannabis continues to evolve globally; at the same time, its market remains enormous. Much of this market represents dirty money from criminal acts, which often requires laundering. In the context of changing cannabis regulations, legislation, and policies, the authors propose the possible implications such changes may have on the extent of money laundering. Design/methodology/approach This paper proposes the implications of the evolution of cannabis regulations on money laundering activities, using the theoretical underpinning of rational choice. Using Australia as a replicable critical case study, the paper, using the Walker gravity model and using United Nations Office on Drugs and Crime-reported prices of cannabis from 2003 to 2017 and Australian Criminal Intelligence Commission reports empirically validates the effects of cannabis regulati...

Research paper thumbnail of Money Laundering: Facets associated with detection and magnitude of the problem

Link to publication General rights Copyright and moral rights for the publications made accessibl... more Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal.

Research paper thumbnail of Using graph database platforms to fight money laundering: advocating large scale adoption

Journal of Money Laundering Control

Purpose This paper advocates the use of graph database platforms to investigate networks of illic... more 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 launderi...

Research paper thumbnail of Shell Companies: Using a hybrid technique to detect illicit activities

2021 Accounting and Finance Association of Australia and New Zealand (AFAANZ) Virtual Conference, Jul 6, 2021

Shell companies can be used to launder dirty money to make it appear legitimate and hide informat... more Shell companies can be used to launder dirty money to make it appear legitimate and hide information about the actual beneficial owners. Illegal arms dealers, drug cartels, corrupt politicians, terrorists and cyber-criminals have become some of the frequent users of shell companies. This study aims to develop a model for detecting shell companies being used to launder illicit proceeds of crime using a new hybrid statistical approach. Using a combination of graph algorithms and supervised learning, detection models with classification accuracy ranging between 88.17% and 97.85%, were developed to detect illicit entities. To the best of our knowledge, no prior study exists on developing quantitative models to detect illicit shell companies using publicly available information. The key stakeholders to benefit from such models would be legal and compliant professionals and government officials, especially accountants, tax officials and anti-corruption NGOs. • The paper uses various combinations of similarity, communitydetection and centrality algorithms (namely, Jaccard Index, Overlap Index, Triangles and Triangle Counting Algorithm, Betweenness Centrality, Approximate Betweenness-Centrality and Harmonic Centrality algorithm). • The results showed that on using three classification algorithms, namely Decision Trees, TreeNet, and Random Forests, for the combination of various graph algorithms, the classification accuracy achieved was within the range of 88.17 % and 97.85 %, respectively. • The performance of these algorithms was regarded using different performance metrics like Area under ROC (AUC), precision, recall and F-value. The scores obtained using various combinations of graph algorithms were used for the classification models to compare the performance and determine whether the classification accuracy is consistent across them. The literature is consistent with use of these measures to evaluate performance (Kute et al. 2021). The lack of any work in the academic literature on detection of shell companies using publicly available information prohibits comparison to evaluate the performance of the present methodology. However, the present work lays down a benchmark for comparison for future studies. • This study has implications for anti-corruption NGOs, corporate registries, financial institutions, government officials, legal and compliance professionals, especially tax-officials and accountants. For anti-corruption NGOs, corporate registries and government officials, such a model would suggest a move towards the incorporation of graph database platform aimed at identifying hidden relationships between entities. For financial institutions with access to transaction information, use of such detection models would aid in filing Suspicious Activity Reports (SARs). The role of accountants is vital in reporting money laundering activities (Mitchell, Sikka, and Willmott 1998b) and use of such models would help them continue to do so.

Research paper thumbnail of Money Laundering Ranking the Countries Attractive for Money Laundering to India

Online International Conference on 'Emerging Opportunities and Challenges in Indian Economy: An Interdisciplinary Approach, Oct 1, 2020

Purpose: This paper estimates the order in which other countries are an attractive destination fo... more Purpose: This paper estimates the order in which other countries are an attractive destination for money laundering to India and determines the proportion that will be laundered to those countries. Methodology: The paper involves the use of Walker's Gravity Model, initially proposed by Walker (1999) and then updated by Unger (2006) to determine the countries attractive for money laundering to India. The paper uses information on GDP per capita, banking secrecy, government attitude, swift information, financial deposits, conflict, corruption, and Egmont group member for 150 countries from 2002 to 2014 to come up with how attractive a country is for money laundering. Then, using distance information of countries from India, the proportion of funds that would be laundered to the countries attractive to India for money laundering is computed. Findings: The analysis finds that countries preferred for laundering money from India are countries characterized by a strong economy and sound financial standing. Research Implications: The paper directs attention towards focusing on the need to curb money laundering in the Indian context and determine the possible destinations where money generated in the economy might be flowing. Practical Implications: This paper takes steps in the fight against money laundering by directing attention towards the destination attractive for money laundering to India. Originality: No studies in the past have considered money laundering flows from India.

Research paper thumbnail of Case of the empty crates: Finding a solution to letter-of-credit fraud

Fraud Magazine, Nov 1, 2021

Research paper thumbnail of Shell companies – Identification of an instrument used for illicit purposes: A Pitch

Journal of Accounting and Management Information Systems, 2018

Research paper thumbnail of Can economic sanctions lead to fraud?: Nations might turn to virtual currencies if slapped with restrictions

Can economic sanctions lead to fraud? Nations might turn to virtual currencies if slapped with re... more Can economic sanctions lead to fraud? Nations might turn to virtual currencies if slapped with restrictions Countries routinely use sanctions on nations to deter and penalize bad behavior. But what if economic restrictions cause criminals to see the anonymity of alternative currencies? We possibly could see increases in fraud, money laundering and terrorism financing. Or not. The jury's still out. Here's what fraud examiners and law enforcement can do as nations move to their own parallel virtual and traditional monetary systems. By Milind Tiwari, CFE; Adrian Gepp, Ph.D., ACFE Educator Associate; and Kuldeep Kumar, Ph.D., ACFE Educator Associate The perpetrator of an $80 million Ponzi scheme needed to launder his dirty money, so he funneled the cash through a Denver online virtual currency exchange backed by established American venture-capital firms, according to a recent Wall Street Journal investigation. (See "How Dirty Money Disappears Into the Black Hole of Cryptocurrency," by Justin Scheck and Shane Shifflett, The Wall Street Journal, Sept. 28, 2018, tinyurl.com/ycpo6j8d.) Governments and law enforcement agencies have long been concerned that virtual currencies can help facilitate money laundering, fraud and terror financing. They've believed that virtual currencies' anonymity and the absence of middlemen make them attractive instruments to finance crimes with ease. But is this concern justified? The debate continues. One school of thought views virtual currencies as an effective terror-funding tool, for example. But another perceives them as ineffective

Research paper thumbnail of Global money laundering appeal index: application of principal component analysis

Journal of Money Laundering Control, 2021

Purpose The paper aims at developing a global ranking system determining a country's appeal a... more Purpose The paper aims at developing a global ranking system determining a country's appeal as a destination for money laundering. Design/methodology/approach This paper uses principal component analysis (PCA), with a mix of standardised and unstandardised components relating to attractiveness, economic freedom and money laundering risk to come up with an index of money laundering appeal. Findings Four components relating to economic feasibility, financial liberty, government spending and tax regime are critical in influencing a country's money laundering appeal. Research limitations/implications This paper attempts to use a standardised and replicable methodology to condense into a single measure the complex and multifaceted phenomenon of a country's appeal as a destination for money laundering, thus avoiding the difficulty associated with precisely calculating illicit financial flows. Practical implications The ranking system could be used to determine the destinations...