Deconstructing Money Laundering Risk

This book examines the interpretation of therisk-based approach (RBA) and itsapplication across the banking industry. It explores the ways conflicting risk interpretation and deconstruction of money laundering riskhave unintended consequences across the banking industry. Furthermore, it offers a theoretical framework that can be adopted and implemented byrisk practitioners to addressmoney laundering (ML) risks. The interpretation and application of the RBA influences the way money laundering risk is perceived, presented, and managed, often resulting in misalignment among stakeholders. Moreover, AML practitioners interpret money laundering (ML) risk as an entity that can be contained, largely in ignorance of the fact that ML risk is self-referential. The book therefore addresses complex inter-system feedback phenomena that lead to de-risking and re-risking, and offers a new ML risk communication framework on this basis. It will be of value to researchers and also to stakeholders within financial institutions, financial intelligence units and regulators in the fight against money laundering.