Money Laundering Blacklists

Michele Riccardi is Deputy Director at Transcrime and Adjunct Professor at Università Cattolica and University of Palermo (Itlay). He has coordinated numerous research projects and publications in the field of money laundering, organised crime, and financial crime. In this domain, he has been consultant for the United Nations, the European Commission, World Bank, and the Italian government.

"For too long, for money laundering and the policies to counter it have been 'an evidence-free zone', with lots of politics, hypocrisy and guess-work covering our enormous ignorance. Riccardi's book is a huge step forward in fixing this sad state of affairs. Money Laundering Blacklists takes an original, rigorous approach in transforming our understanding of where the real risks of dirty money lie, and how the fight against illicit finance should be re-focused. It's rare that a book can be so important and compelling for both scholars and policy-makers, but Riccardi has achieved this rare feat".Jason Sharman, Sir Patrick Sheehy Professor of International Relations University of Cambridge"For a nation to be blacklisted for anything is troubling. To be blacklisted for an activity as apparently serious as failure to control money laundering is deeply troubling. Yet, Michele Riccardi's scholarly but very readable book shows that the label is usually applied by official bodies in an arbitrary and unhelpful way. Riccardi offers a theoretically informed empirical approach to testing whether a country truly belongs on a money laundering blacklist".Peter Reuter, Distinguished Professor of Public Policy and Criminology at the University of Maryland"This book reminds us that the current state of the art on assessing national anti-money laundering risk is woefully insufficient. It usefully proposes defining AML risk from the perspective of the viewing country and dispenses with the canard that small and poor countries are the main AML problem, when in fact large, rich countries hold the lion’s share of the world’s dirty money".Charles W Littrell, Inspector of Banks and Trust Companies, Central Bank of The Bahamas"With money laundering risk assessments increasingly seen as the cornerstone of an effective framework to tackle financial crime, this book provides a timely analysis of existing blacklists and approaches to measure risks. It challenges and demystifies many of the methods while offering concrete and promising solutions to assess money laundering risks, taking into account how criminals move dirty money across borders and the role of both source and destination countries".Maíra Martini, Leader of AML and Beneficial Ownership research & policy, Transparency International

• List of figuresList of tablesAcknowledgmentsList of abbreviationsIntroductionPART I: Money laundering risk measures Money laundering risk and determinants Money laundering (and illicit financial flows) Money laundering risk Determinants of money laundering risk across countries: proximity, opacity, and security Available measures of money laundering risk Money laundering blacklists and grey lists Origin and scope of anti-money laundering blacklists The FATF blacklist and grey list The US INCSR list The European Union anti-money laundering blacklist Blacklists and sanctions Other lists of high-risk countries Lists based on judicial investigations Lists based on media investigations: from Panama Papers to FinCEN files Lists based on financial/corporate data analyses Lists based on crime data analyses Composite indicators Lists developed by banks and other obliged entities Relations and underlying components of existing risk ratings Summary: the gaps in existing risk ratings and blacklistsPART II: A New measurement approach A new approach to identify countries at high-risk of money laundering Rationale Methodology and operationalisation A practical application: money laundering risk from the perspective of Italy Discussion and policy implications Discussion Policy implications Limitations and future research directions AppendixReferencesIndex