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Behavioral Economics and Lessons for FCPA, AML, and Tax Compliance
July 10th, 2013
Under the standard economic theory of crime, compliance with laws is a mix of two important factors. One: the penalty that results if the offender is caught and 2: the probability of the offender getting caught in the first place. If the fine is proportional to the crime, but the probability of being caught is almost certain, few will risk it. In the same way, if the probability of being caught is low, but the penalty is very high, again few will risk it. Gary Becker—the libertarian economist who wrote Crime and Punishment: An Economic Approach, an...
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Video: Global Witness Investigation Into Corruption in Malaysia, Facilitated by Shell Companies
March 19th, 2013
If you only watch one video today, this one is for you. Task Force member Global Witness published their stunning investigation today. The documentary uncovers how corruption is facilitated in Malaysia. Hidden cameras show Malaysian money launderers explaining exactly how they are going to set up an anonymous shell company (complete with finding rural villagers to sign their names on as nominee shareholders), buy massive amounts of land from corrupt Malaysian officials, and move the money to a secret Singapore bank account. Malaysia lost $285 billion in 2001-2010 to illicit financial outflows, and Global Witness has vividly demonstrated how such...
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HSBC, Panama: “Exit, stage right”
March 12th, 2013
according to Jonathan Guthrie of the Financial Times, in discussing the decision of HSBC to close down its operations in Panama (Corruption Perceptions Index score in 2012: 38 out of 100). The decision was purportedly to increase profits – but maybe not in the way one would expect.
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