Those inclined to believe that financial malfeasance is widespread will find abundant evidence in this past summer’s headlines alone. Standard Chartered, ING, and HSBC—three of the world’s largest banks—agreed to pay hundreds of millions in fines to settle charges of helping pariah states subvert international sanctions. Walmart, under pressure from regulators, launched an internal investigation into allegations of bribery and money laundering by its Latin American affiliate. And in the U.S. presidential campaign, accusations about offshore financial havens and Swiss bank accounts have flooded the airwaves.
In The Money Laundry, J.C. Sharman of Australia’s Griffith University raises his acutely cocked eyebrow not at the prevalence of money laundering (which he concedes is rampant) but at the ability of existing policies to halt its spread. Sharman has gathered data not only through meticulous research and experience consulting for international organizations but—with a dash of brio in a field that can otherwise seem dry—by posing “as a would-be money launderer, soliciting offers for prohibited anonymous shell companies and bank accounts.”
Sharman argues that antimoney laundering policy is not only ineffectual but has frequently been driven more by pressure to conform to the wishes of outside interests—powerful countries, organizations, and companies—rather than to solve actual problems. Highlighting the reduction ad absurdum case of Nauru, he questions why an eight-square-mile Pacific atoll with a population of 11,000 would focus a quarter of its legislation passed in the last decade on money laundering when faced with so many more pressing needs. It seems a persuasive case, considering as how Nauru has not a single bank, no currency, and lacks any sign of a financial sector to speak of.
Ultimately, the author proves this point, though it is not necessarily novel to observe that small states must often heed the wishes of larger powers to safeguard their own diplomatic and economic interests. However, given Sharman’s considerable expertise on the subject—demonstrated amply throughout the book—readers may wish the author spent more time prescribing ways to remedy the flaws of the current approach.