Money Laundering - Essay Example

When my classmate April Morales says that money laundering occurs as a way of concealing illegal activities, I agree with her. Even though the international community wages a war against money laundering and other forms of financial terrorism, this criminal activity still continues (White, 2013). The problem continues because criminals use unorthodox methods such as what Morales identified as coercing and bribing employees not to file the right reports for transactions.

Nonetheless, Morales has only named a few ways that are useful in combating money laundering activities. For example, she has mentioned training employees on how to avoid and the effects of money laundering, implementation of money laundering laws, and the need for Money Service Businesses (MSBs) to know how money laundering schemes work. In addition to what she has mentioned, I believe there are other techniques that organizations or the government can use to prevent these criminal activities. For example, more countries or organizations should meet to coordinate and share their models of legislation, trends, and multilateral agreements. Currently, only a few countries are active in these discussions. If all countries were to meet for such discussions, it would work because certain financial watchdogs such as the Financial Action Force (FATF) emerged from member countries having such international discussions. According to the United Nations Office on Drugs and Crime (2003), the establishment of FAFT took place in the year 1989 and it is an inter-governmental body. Its objective is to promote effective implementation of laws and measures that combat threats related to the financial systems of member states (United Nations Office on Drugs and Crime, 2003).

However, this is a preventive measure that would occur on a large-scale level. On a small-scale level, the due diligence for individuals matters. To remove ambiguity from a lower level, customers should prove their identity when carrying out financial transactions with valid personal identification documents, not only by using payment cards. When it comes to organizations, White (2013) asserts that businesses with legal documents of operations also engage in money laundering. Therefore, the best technique would be to have rules that require businesses to provide information about their intended transactions, the nature of transactions and the purpose of the business relationship.