Money laundering and illicit flows from China – the real estate problem

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.*Related content and download information correct at time of download. Design/methodology/approach -This paper considers the specific issues that laundering money through the real estate sector poses to the Chinese banking system and other global banks that could be in receipt of illicit funds from China. The paper also discusses the source of most of China's illicit flows, which are believed to be from corruption and financial crime offences rather than drug or organised criminal gangs.Findings -The paper uses empirical evidence, including media coverage and academic studies from other authors working on this issue, and supports the need to develop stronger risk-based systems, as opposed to rules-based systems, for managing AML risk assessment. Previous work by the author and suggestions from other authors are both used to suggest a basic framework for AML risk assessment.Originality/value -The paper concludes by reiterating the fact that China like all other countries is now operating in an international banking context, in much the same way that international organised crime is also operating at a global level. It also emphasises that real estate remains a targeted sector for criminals seeking to launder funds.

Mafia doesn't live here anymore: Antimafia policies and housing prices

“…Investing in property is indeed a safe channel to place in legal markets the proceeds of money‐laundering activities. And this appears to be a frequent practice for criminal organizations all over the world (Naheem, 2017; Nelen, 2008; Schneider, 2004) and more specifically in Italy (Dugato et al, 2015; Transcrime, 2013a). In this perspective, it is not unlikely for the pervasive presence of organized crime groups to affect real estate values.…”

Shooting down the price: Evidence from Mafia homicides and housing prices

“…In this context, some works investigated the direct effect of organized crime activities on the real estate market. For example, Schneider (2004), Nelen (2008), and Naheem (2017) show how the financial proceeds from illegal activities are laundered in housing markets, respectively, in Canada, the Netherlands, and China. From a criminal behavioral perspective, the recent work by Dugato et al (2015) shows that Italian Mafias invest in real estate in areas where the control of the territory is particularly strong, and where the symbolic rewards are relevant.…”

Taxonomies of money laundering: an Iranian perspective

“…In Brazil, the major sources of illicit funds are smuggling, corruption, narcotics trafficking and organised crime (Bijos, 2014). In China, the source of illicit funds is more related to corruption and insider dealing rather than drugs and violent crimes (Naheem, 2017). In India, the main sources of dirty monies are corruption, fraud, currency counterfeiting, organised crimes, human trafficking and drug trafficking and the main tool for money laundering is hawala (Karr and Curicio, 2011).…”