Enhancing effectiveness of anti-money laundering laws through whistleblowing

Abstract

If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. AbstractPurpose -The purpose of this paper is to review inadequacies of anti-money laundering (AML) and whistleblowing laws particularly in the UK financial services sector and suggest various reforms initiatives. Design/methodology/approach -The article relies extensively on secondary data analysis including extensive literature review, analysis of applicable cases and evaluation of current whistleblowing and AML laws. Findings -The preponderance of defensive reporting particularly in the financial services sector appears to blunt the effectiveness of AML laws in the UK. Working adults generally are unaware or unfamiliar with whistleblowing laws, whereas the laws themselves are also deficient in some ways even though they have been adopted and adapted in various other jurisdictions because of its perceived comprehensiveness. Preliminary indications from money laundering scandals demonstrate how and why early disclosures of wrongdoings through whistleblowing might have helped to reduce the magnitude of the adverse consequences and hence the importance of whistleblowing in the fight against money laundering. Originality/value -This article provides the argument that while money laundering is perpetuated by hard-core criminals, it could be aided along by others motivated by profits in the financial system and that those closes to the process and in particular workers when encountering such activities should be encouraged to report these via appropriate channels. This together with further revamping of the suspicious activity reports procedures required under AML laws is argued to be able to contribute to the reduction of defensive reporting thereby enabling enforcement agencies to have more effective focus on remedial actions.

Money laundering control in Tanzania

“…Some banks have collapsed as a result of money laundering activities. These include the Bank of Credit and Commerce International in 1991 and Barings Bank in 1995 (Johnson and Lim, 2003;Buchanan, 2004;Busch, 2004;Yeoh, 2014). Banks may incur criminal as well as civil liability for non-compliance of the AML laws (Verhage, 2009).…”

“…National regulators do impose penalties and sanctions on banks that violate the AML laws (Gup and Beekarry, 2009;Rahman, 2013). Some banks in the United States including Barclays, HSBC Bank USA, the Bank of New York, Riggs Bank, UBS, ABN AMRO and Citibank have, on different occasions, been implicated in facilitating or associated with money laundering activities (Johnson and Lim, 2003;Zarate, 2009;Otusanya et al, 2011;O'Brien and Dixon, 2012;Yeoh, 2014;Naheem, 2016;Hardouin, 2017). In the United Kingdom some banks have been fined for violating AML regulations.…”

The viability of recent enforcement mechanism to combat money laundering and financial terrorism (AML/CFT) in Nigeria

“…Merit of having enabling environment and well-structured legal instruments that seek to protect whistle blower as identified by many scholars such as Peter Yeoh (2014) and others are said to be enormous (Yeoh, 2014). Accordingly, whistle blowing is said to be a revamping tool for AML requirement of reporting suspicious transaction and therefore capable of reducing defensive reporting which can in turn enable enforcement agencies to concentrate on the remedial matters or actions (Yeoh, 2014). Thus an early report through effective whistle blowing mechanism is believed to have potency of reducing the magnitude of the likely consequence of the crime and capable of fishing out the culprits.…”

Anti-Money Laundering Game between Banking Institutions and Employees in the Progressing CNY Internationalization

“…He suggests that special budget should be allocated for the capacity building of employees through training and implementation of AML regulations should be timely, transparent and consistent. Yeoh [15] argues that early exposing wrongdoings may decrease severity of consequences, and revamping of the suspicious activity reports procedures required under AML laws is helpful to reduce defensive reporting and enable enforcement agencies to have more effective focus on remedial actions.…”