Effectiveness: threat and corresponding policy response

This chapter explores to what extent the policy response towards money laundering is effective in relation to the money laundering threat the EU Member States face. It is argued that AML policy response can be captured by several indicators: FATF compliance, legal effectiveness, timeliness of implementation, FIU response, international cooperation, information flows and the number of convictions for money laundering. The exploratory analysis is based on a set of figures which have a policy response indicator on the horizontal axis and the threat measure on the vertical axis. The chapter considers the diagonal area in these figures to mark an appropriate policy response - i.e. a policy response that is more or less proportional to the AML threat a country is facing. The chapter shows that most Member States have proportional AML policy responses. Nevertheless, all of them can improve on at least one aspect of their policy response with the positive exception of Denmark, that has, in the analysis of the chapter, relatively low levels of threat and relatively high policy response scores.