Money Laundering Research Proposal
Money Laundering Research Proposal
1.0 Introduction
1.1 Statement of the problem
Money laundering has been a common phenomenon in many economies. It is for this reason that a need to research on the impact of money laundering in the banking sector. Money laundering is a very broad discipline consisting of different steps and approaches that lead to fulfillment of this criminal offence. The research work will mainly be concerned with discovering how the money laundering exercise is fulfilled in order to enhance detection and prevention of such moves in the banking sector (Pock, 2007). The research process will mainly rely on the past researches and journals in getting the maximum information regarding this topic. The purpose of this research work is to provide the general public with the idea of what is money laundering, its effect on the economy and suggest on possible measures to curb the menace.
1.2 literature review
Over the past few years, several definitions have been put forward to explain what is money laundering. However, money laundering can be essentially be defined as a process of obtaining money illegally and trying to make it legal. This form of crime is mainly carried out in the banking sector through profit motivated crimes such as corruption, fraud, embezzlement and misappropriation just to mention but a few.
According to Billy Steel, money laundering consists of various transactions intended to change the source of financial asset thus not compromising the criminal offence. The three stages as outlined by Billy include; placement, layering and integration. Placement refers to the stage whereby the physical distribution of financial asset takes place. At this stage, the main objective of the perpetrator is to remove cash from the location of acquisition by converting it into assets thus preventing detection from the authority (Levy, 2011).
Layering is the second stage and it involves creating of complex layers of financial transactions. By so doing, the perpetrator is able to cover audit tails thus providing high levels of secrecy. The layering process is very essential in disguising the origin and ownership of funds. It is a critical stage as it disassociates the illegal funds to the source of the offence. It is at this stage that the perpetrators of this crime can involve other professionals such as lawyers, brokers and consultants to enhance secrecy and legality of the funds.
The last stage in money laundering process is the integration stage. This is the stage at which the perpetrators of the crime try to create the legitimate origin of the assets in question. This is the ‘cleaning’ stage and the launder make the money appear as legally earned. It is at this stage that great caution should be taken since this is where the lauder makes it difficult for the authority to detect any misdoings. The huge sums earned through such dealings is mainly removed from the country of origin and cycled through international payments thus making any audit attempt futile. The laundered money is disguised to be from casinos, real estate sales or fake imports of valuable goods. Money laundering cries are profit-motivated, it is for this reason that the perpetrators must ensure that what they do does not attract attention from the respective authorities.
1.3 Research question/hypothesis
Money laundering is real and has been happening all over the world. The aim of this research is to unearth how the criminal acts are fulfilled and what can be done to combat the crime. At the end of the research process, answers to the following questions must be obtained;
- Identify the emerging trends in the transnational crimes involving money laundry
- Identify the impact the money laundering business has brought to the modern banking sector
- Suggest anti-money laundering techniques that could be instrumental in enhancing secrecy and transparency in the banking sector.
- The research must also outline the overall effects of money laundry in the economy
2.0 Methodology
The research process will involve collection of both primary and secondary data. However, to increase credibility of the research process, primary sources will be more reliable. Interviews will be conducted to academics, bankers, bank managers and law enforcing agencies will be critical tool for data collection. Use of questionnaires will be highly appreciated to make the interviewing process faster and more effective. The research team will be required to visit several banks both within and out of the city to have a clear picture and the pattern through which the crime is orchestrated. It will also be important for the research team to have interaction sessions with law enforcing agencies and other anti-money laundering agencies to have their views on the vice (Unger, 2013).
The research team will also be interested in using secondary data in the research process. For instance, the research team will embrace reports from previous researches in compelling the new report. Information from company websites, reports, financial statements and journals will be of great help in this research process. This is because they will play a great role in supplementing the primary research findings.
2.1. Procedure
The research process will be carried out in a chronological manner. This is very essential to ensure that the research process is comprehensive and all areas of study are covered. A well designed action plan will be used to guide the research process. This will ensure a comprehensive research is achieved in a timely manner and the stipulated resources.
- Data Analysis
The data collected in a research process cannot be of any help if it is not analyzed. After data collection through questionnaires and interview, the data will be put in tables and graphs. This will make it easy for analysis using specific statistical analysis such as regression.
- Significance of the study
This research proposal is expected to have a lot of relevance in the economy. It is my hope that the research will be of great importance to;
- Security agencies
- Bank management
- Government
- Future research exercise
The work of the security and law enforcing agencies will be made much easier after the completion of the research. This is because the research will unearth how the crime is committed and concealed to the agencies. The research will also suggest possible anti-money laundering techniques and possible punishment to the perpetrators thus making the research very essential.
On the other hand, banks will also benefit immensely from this research work. This is because the research suggests ways of combating this kind of crime which will have substantial positive impact on the banks. Proper integrated management of such financial crimes are critical in reducing corruption, identity crime, legal risks and financial risks among others which are likely to compromise the reputation of the bank. The research will also be very instrumental in enhancing the global banking sector through reduction of transnational crime (Ryder, 2012).
The other beneficiary of this research work will be the federal government. This is because the money laundering business has adverse effects on the economy. For instance, the business involves colossal amounts which are evacuated from the country of origin to other countries. This has very devastating effect to the economy as it leads to a distorted and imbalanced economy. It is also hoped that major government will avoid tax loss which is facilitated by the money laundering exercise. A lot of taxes are lost in the event of a money laundering exercise. This is because of the several maneuvers by the perpetrators in the attempt to conceal the origin of such funds. The process leads to massive confusion thus making the government suffer massive losses in terms of uncollected taxes. It is hoped that this research work will provide solution to these eminent drawbacks.
The research process is also hoped to be of great importance to future researchers. This is because research work is ever continuing and one may want to take the research to a further stage and the report is deemed critical for such practices.
References
Unger, B., 2013. Research handbook on money laundering. New York: Edward Elgar Publishing.
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