Banking Secrecy and Global Finance

Legal opacity, narcotics laws, and drug seizures

“…Our measures moderately and negatively correlate with the FSI: countries with the highest level of opacity are not the biggest exporters of financial services. The legal opacity index is positively correlated with the onshore-offshore attitude index from Masciandaro and Balakina (2014). Territories that are blacklisted by international organizations tend to be opaque.…”

“…We combine detailed information on country rules and legal tools and techniques offered to hide illicit proceeds for 185 countries over the decade 2000-10 and 191 countries over 2010-20. Our legal opacity index considers various factors that influence the degree of legal opacity: the level of financial and banking secrecy; the availability of secretive vehicles; internal legal policies and regulations; and international cooperation. Financial or banking secrecy allows financial proceeds from illicit economic activities to be managed safely and reintegrated into the global financial system (Masciandaro and Balakina 2014). Secretive legal entities disconnect real actors from economic transactions (Palan et al 2010; van der Does de Willebois et al 2011).…”

“…Our measure relates also to indices by Masciandaro and Balakina (2014). These authors argue that policy-makers implement banking secrecy laws to attract illicit flows, but have to face reputational and criminal costs in return.…”

Footprints of Human Resource in Banking Sector

“…Trust and loyal workforce ensure in bringing more productivity in the business [10]. Human resource plays a vital role while framing economic policies, and financial regulations to facilitate maintaining policies of banking secrecy, stability in a financial position [11]. Technological innovations have always shaped the banking business in a dynamic angel resulting to more redefined integrated strategies impacting the customer relationship, innovative business models, designing the customized products and services, and addressing financial criticalities which ponder over the relationship between technology and financial leverages [12].…”