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Abstract
Money laundering and its prevention is a significant issue in many countries. Various attempts for policing money laundering have been taken at different levels; however, the problem of money laundering is steadily increasing. Based on secondary data, this research paper examines the trends and issues in the anti-money laundering efforts in Afghanistan. It recognizes that money laundering has acquired the status of a global problem and Afghanistan is not an exception. It looks for the Afghan government initiatives designed to control money laundering and terrorist financing. Whilst the focus of study is Afghanistan, this study also takes into account the impact of international regulations (such as UN and FATF) on the way money laundering is tackled in Afghanistan. It is argued that the lack of political will of the government is a major obstacle in the policing of money laundering in Afghanistan. The Afghan parliament has yet to pass the proposed legislations on money laundering and financing terrorism. In addition, there is serious shortage of human resources in all government departments. The information sharing mechanism among different government departments is extremely poor. There is lack of trust between Da Afghanistan Bank and the Afghan National Police with respect to sharing information related to money laundering cases. The Afghan National Police are often accused of being corrupt and have links with criminal gangs. The proper mechanism for training police officers with respect to money laundering investigations is missing. There was no system for keeping official statistics on money laundering cases in Afghanistan. This study argues that the policing of money laundering in Afghanistan requires an effective and a well integrated multi-agency approach where information pertaining to money laundering cases must flow with proper accountability system.
Keywords
Money Laundering, Financing Terrorism, Globalization, International Standards, Hawala Remittance System.
Defining and Meaning of Money Laundering
Money laundering is a financial crime and is an old phenomenon (Buchanan, 2004). However, as a specific crime, it did not enter into legal context until 1986 (Daley, 2000). The term 'money laundering' was first coined by the American law enforcement officials. The background of the concept of money laundering can be traced back to the scam by Al Capone in Chicago during 1920s where he setup a Chinese laundry to...