Simon Young on Policing and Prosecution of Money Laundering (new book chapter)

"Policing and prosecution of money laundering"
Simon Young
in V Mitsilegas, S Hufnagel, and A Moiseienko (eds), Research Handbook on Transnational Crime (Edward Elgar 2019) Chapter 10

Introduction: Almost all countries have a criminal offence of money laundering in their law books. This happened in a relatively short time, beginning from the late 1980s with the emergence of international standard setting on money laundering. With the establishment of the Financial Action Task Force (FATF) in 1989 and the conclusion of a series of transnational criminal law treaties (beginning with the 1988 Vienna Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances), countries have accepted and implemented obligations to establish an extensive global anti-money laundering (AML) regime in their domestic law.2 Countries have also accepted international scrutiny of their AML regime through mutual evaluation conducted by the FATF and associated regional bodies.3 In their early years, these evaluations assessed only compliance with a set of international standards (commonly known as the FATF’s 40 Recommendations), but more recently, since 2013, they have also involved separate evaluations of the effectiveness of a jurisdiction’s AML regime according to a smaller set of immediate outcomes.4 The first set of evaluation reports done under the new methodology provides rich data for reflection on what has been achieved in the policing and prosecution of money laundering in the 30 years since the articulation of international standards. The reports show that while states are largely compliant technically with relevant standards, their performance in achieving policing and prosecution outcomes is underwhelming. This chapter identifies some of the salient considerations relevant to high and low effectiveness in policing and prosecution outcomes. The chapter begins with a brief discussion of the distinctive features of policing and prosecuting the money laundering offence. It then outlines the FATF’s international standards on money laundering and its method of mutual evaluation, particularly after the extension of the methodology to effectiveness assessments in 2013. The focus in this chapter is on the standards of policing and prosecution of money laundering. In the FATF methodology, three outcome standards are directly relevant: the use of financial intelligence, the enforcement of the money laundering offence, and the confiscation of criminal property. After providing an overview of the results in the 48 jurisdictions reviewed for effectiveness thus far, this chapter looks more closely at the evaluations of three jurisdictions obtaining high effectiveness ratings and three jurisdictions obtaining low ratings. From this analysis, a list of relevant considerations is identified. The chapter concludes with some reflections on the future of FATF mutual evaluations.