Investigating the Effectiveness of Sterilization Policy in Controlling Money Supply and Capital Inflows in Nigeria

Abstract

Money laundering, in its almost 90-year-long history, has attracted the attention of the scientific, professional, but also the general public. Throughout the entire period, the manifestations of this criminal phenomenon, its typology, etiological factors, etc., have changed, but the essence has remained the same: the transformation of illegally acquired money into legal financial flows. Emerging markets are particularly burdened, which is the subject of this paper: identifying, monitoring and proving the process of money laundering with the aim to reduce it in developing countries. In addition, what can be observed in these markets is that money laundering operations are mainly related to those activities where most of the payments are made in cash. Their specificity, that is, the basic motive for execution, is not just a profit, but the aspiration to introduce “dirty” money into legal flows. The aim of this paper is to use the method of description to explain and describe scientifically the money laundering process and to combat this phenomenon with a focus on the characteristics of the money laundering process. In addition, the paper describes the models and weaknesses of this process, while at the same time it respects the standards and specifics of business operations in emerging markets. The result of the paper is that it provides an overview of money laundering in the 21st century in small and open economies, including proposals to prevent and combat this negative phenomenon.

The adequacy of the legal framework for combating money laundering and terrorist financing in Nigeria

“…Money laundering is shrouded in mystery, its scope is difficult to measure (Grujić and Šikman, 2020; Alldridge, 2003), and it is an economic crime which affects all countries in the world, including Nigeria [Chitimira and Ncube (2021); Grujić and Šikman (2020); Stanley and Buckley (2016), Hopton (2016), Buchanan (2004)]. Money laundering is growing at a phenomenal rate in Nigeria, and it presents challenges of a global dimension to policymakers, especially with regards to terrorist financing activities and the integrity of the financial markets and financial institutions [Chitimira and Munedzi (2021), OECD (2019); Haigner et al (2012), Kama (2005)].…”

Unveiling The Shadows: Exploring Money Laundering Mechanisms In Bangladesh's RMG Sector

“…These deals look fine on paper, but they don't help the economy in any way (Umar, 2023). This makes them perfect for hiding dirty money (Grujić and Šikman, 2021). The effects of TBML are wide-ranging and pose a big problem for the world's banking system (Marzouk, 2022).…”

Relationship of Anti-Money Laundering Index with GDP, financial market development, and Human Development Index

“…However, despite attempts to express the amounts of laundered money, it all comes down to estimates of the amount and number of launderers because it is a mysterious phenomenon and its scope is difficult to measure, especially because the most successful methods are still unknown (Jullum et al, 2020). Moreover, its simplified understanding seems to lead to the trivialization of this problem (Grujić & Šikman, 2020). The correlation between money laundering and economic development has been studied in previous research.…”