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Money Laundering: Some Facts

Author

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  • Friedrich Schneider
  • Ursula Windischbauer

Abstract

The term "Money Laundering" originates from the US describing the Mafia's attempt to "launder" illegal money via cash-intensive washing salons, which where controlled by company acquisitions or business formations. Estimated two to five per cent of the global gross domestic product stems from illicit sources. A great deal of the money derives from drug-dealing, with a total revenue of 810 Billion USD in 2003. In 2005 the Austrian Police secured drugs worth 49266800 Euro (drug seizures in terms of street prices), in total 25.892 persons were charged for violation of the Austrian Narcotics Act. Most of all illegal transactions are processed by cash since there is the smallest risk to leave one's mark; nevertheless there exists an obvious tendency to misuse the internet in order to undertake illicit transactions in form of Online- Banking, Cyber money and Electronic Purse.

Suggested Citation

  • Friedrich Schneider & Ursula Windischbauer, 2010. "Money Laundering: Some Facts," Economics of Security Working Paper Series 25, DIW Berlin, German Institute for Economic Research.
  • Handle: RePEc:diw:diweos:diweos25
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    References listed on IDEAS

    as
    1. Esther C Suss & Oral Williams & Chandima Mendis, 2002. "Caribbean offshore Financial Centers; Past, Present, and Possibilities for the Future," IMF Working Papers 2002/088, International Monetary Fund.
    2. Esther C Suss & Oral Williams & Chandima Mendis, 2002. "Caribbean offshore Financial Centers; Past, Present, and Possibilities for the Future," IMF Working Papers 02/88, International Monetary Fund.
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    Cited by:

    1. Donato Masciandaro, 2018. "Central Bank Digital Cash and Cryptocurrencies: Insights from a New Baumol–Friedman Demand for Money," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 51(4), pages 540-550, December.
    2. Godspower-Akpomiemie, Euphemia & Ojah, Kalu, 2018. "Money laundering, Tax havens, Transparency and Board of Directors of Banks," MPRA Paper 89550, University Library of Munich, Germany.
    3. Perez, M. Fabricio & Brada, Josef C. & Drabek, Zdenek, 2012. "Illicit money flows as motives for FDI," Journal of Comparative Economics, Elsevier, vol. 40(1), pages 108-126.
    4. Vahid Jafari Sadeghi & Paolo Pietro Biancone & Charles Giacoma & Silvana Secinaro, 2018. "How does export compliance influence the internationalization of firms: is it a thread or an opportunity?," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 8(1), pages 1-15, December.
    5. Valentina Gullo & Pierluigi Montalbano, 2018. "Where does “dirty” money go? A gravity analysis," Working Papers 5/18, Sapienza University of Rome, DISS.
    6. Friedrich Schneider, 2017. "Restricting or Abolishing Cash: An Effective Instrument for Fighting the Shadow Economy, Crime and Terrorism?," Economics working papers 2017-08, Department of Economics, Johannes Kepler University Linz, Austria.
    7. Guerino Ardizzi & Carmelo Petraglia & Massimiliano Piacenza & Friedrich Schneider & Gilberto Turati, 2014. "Money Laundering as a Crime in the Financial Sector: A New Approach to Quantitative Assessment, with an Application to Italy," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 46(8), pages 1555-1590, December.
    8. Hasan, Iftekhar & Martikainen, Emmi & Takalo, Tuomas, 2014. "Promoting efficient retail payments in Europe," Research Discussion Papers 20/2014, Bank of Finland.
    9. Guerino Ardizzi & Carmelo Petraglia & Massimiliano Piacenza & Friedrich Schneider & Gilberto Turati, 2013. "Money Laundering as a Financial Sector Crime - A New Approach to Measurement, with an Application to Italy," CESifo Working Paper Series 4127, CESifo.
    10. Friedrich Schneider, 2011. "The Financial Flows of the Transnational Crime: Some Preliminary Empirical Results," Economics of Security Working Paper Series 53, DIW Berlin, German Institute for Economic Research.
    11. Schneider, Friedrich, 2010. "The (Hidden) Financial Flows of Terrorist and Organized Crime Organizations: A Literature Review and Some Preliminary Empirical Results," IZA Discussion Papers 4860, Institute of Labor Economics (IZA).
    12. Unger Brigitte, 2009. "Money Laundering - A Newly Emerging Topic on the International Agenda," Review of Law & Economics, De Gruyter, vol. 5(2), pages 807-819, December.
    13. Slim, Sadri, 2015. "Un modelo Mundell-Fleming con economía ilegal y lavado de dinero [Modeling illegal economy and money laundering: a Mundell-Fleming framework]," MPRA Paper 64675, University Library of Munich, Germany.
    14. Emanuele Borgonovo & Stefano Caselli & Alessandra Cillo & Donato Masciandaro & Giovanno Rabitti, 2018. "Cryptocurrencies, central bank digital cash, traditional money: does privacy matter?," BAFFI CAREFIN Working Papers 1895, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    15. Emanuele Borgonovo & Stefano Caselli & Alessandra Cillo & Donato Masciandaro, 2018. "Between Cash, Deposit And Bitcoin: Would We Like A Central Bank Digital Currency? Money Demand And Experimental Economics," BAFFI CAREFIN Working Papers 1875, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    16. Raffaella Barone & Donato Masciandaro, 2011. "Organized crime, money laundering and legal economy: theory and simulations," European Journal of Law and Economics, Springer, vol. 32(1), pages 115-142, August.
    17. Claudio Quintano & Paolo Mazzocchi, 2018. "Behind the GDP: some remarks on the shadow economy in Mediterranean countries," European Journal of Law and Economics, Springer, vol. 45(1), pages 147-173, February.
    18. Ardizzi, Guerino & De Franceschis, Pierpaolo & Giammatteo, Michele, 2018. "Cash payment anomalies and money laundering: An econometric analysis of Italian municipalities," International Review of Law and Economics, Elsevier, vol. 56(C), pages 105-121.
    19. Michael Pickhardt & Jordi Sarda, 2011. "The size of the underground economy in Germany: a correction of the record and new evidence from the modified-cash-deposit-ratio approach," European Journal of Law and Economics, Springer, vol. 32(1), pages 143-163, August.
    20. Guerino Ardizzi & Carmelo Petraglia & Massimiliano Piacenza & Gilberto Turati, 2014. "Measuring the Underground Economy with the Currency Demand Approach: A Reinterpretation of the Methodology, With an Application to Italy," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(4), pages 747-772, December.
    21. Friedrich Schneider & Raul Caruso, 2011. "The (Hidden) Financial Flows of Terrorist and Transnational Crime Organizations: A Literature Review and Some Preliminary Empirical Results," Economics of Security Working Paper Series 52, DIW Berlin, German Institute for Economic Research.
    22. Emma Galli & Ilde Rizzo & Carla Scaglioni, 2018. "Is transparency spatially determined? An empirical test for the Italian Municipalities," Working Papers 6/18, Sapienza University of Rome, DISS.

    More about this item

    JEL classification:

    • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General

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