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Pawel Kuskowski
Pawel Kuskowski
Combining AI with AML/KYC tech to make the most effective and user-friendly compliance system
Published Mar 9, 2023
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Did you know that money laundering is the world's third-largest business, with an estimated $2 trillion laundered annually?
This is an eye-watering amount which directly finances global criminal activity. Money laundering contributes to wars, drug trade, human trafficking, and political corruption - the cancer of modern society.
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Money laundering is a global issue which affects economies across the world. It is estimated that up to 5% of global GDP is laundered each year, amounting to $2 trillion. According to a report by the United Nations Office on Drugs and Crime, the bulk of this money, ranging between $200 billion and $500 billion, is generated from drug-related activities and is circulated through various channels looking for good "laundromats".
One of the easiest ways to launder money is by setting up an offshore company, either real or fictitious, that can control bank accounts anywhere in the world. Creating such a company only takes less than 24 hours and $100. Casinos, brokerages, and banks are also popular channels for laundering money, with banks being the ultimate "laundromats" due to their ability to carry out international transactions quickly. Moreover, banking regulations in many nations are made to appeal to people and organizations who demand total secrecy for their deposits.
Despite the magnitude of this problem, money laundering is rarely curtailed. Many countries, particularly European countries, do little to prevent money laundering as it is strictly up to banks to report "suspicious" deposits. Even when they do, such reports are rarely investigated and sanctions are typically mild.
Some people believe modern technology will make the fight against money laundering virtually useless, but this is different. Instead, technology can aid in tracking suspicious transactions and identifying the individuals behind them.
As money laundering is crucial for many crime operations, it's a persistent problem plaguing global economies.
Money Laundering Statistics
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13 Comments
Elias Nichupienko
Co-founder of Advascale | A cloud sherpa for Fintech
1y
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Pawel, thanks.
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Samir Khosla
Repeat Founder | Entrepreneur | Investor ->I love rolling up my sleeves for the zero-to-one journey!
1y
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What percentage of this happens via crypto? An insignificant fraction?The tens of billions of dollars in fines FIs and Banks pay need to be tacked on as a cost as well!
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Mark Weclawek
CEO, MWek Solutions & The RiskPod. Founder, The MWek Company - +971 58 546 1025. Between Dubai & London.
1y
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That’s a truly crazy stat
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Mikko Ohtamaa
CEO, co-founder at Trading Strategy
1y
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Why do you think anti-money laundering success rate is so low? Becase when I go to a bank, they will ask a lot of questions and forms. Do not these forms mean anything?
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