Money Laundering

Sarah Simon

12 min Read Time | April 21st 2022

Key Takeaways

Make sure to build a solid introductory paragraph specifically tailored to the company’s industry and location. Include as much information about the detrimental impacts money laundering has on society.

Clearly describe the company’s involvement in the fraudulent activity. Include information about how long it lasted, the amount of money that was laundered, and the value of the fine.

Use trustworthy sources and base your analysis on clear court rulings.

Executive Summary

The topic addresses a company’s involvement in fraudulent money laundering and tax evasion activities. 

The analysis should include a complete introduction that specifies the impacts of the illegal activity tailored for the company’s industry and location. 

The analysis should clearly describe the company’s involvement and the amount of money laundered and established a clear track record. Additional information about the proceeds of the illegal funds and comparisons to the company’s annual revenue would help you build a stronger case.

The analysis must use trustworthy sources and be based on a clear ruling for the topic to be considered.

What is it?

Money laundering is the “illegal process of making large amounts of money generated by a criminal activity, such as drug trafficking or terrorist funding, appear to have come from a legitimate source. The money from the criminal activity is considered dirty, and the process ‘launders’ it to make it look clean”.

Criminals use different techniques to make their money appear legitimate, introducing it back into the economy. It occurs from simple cash transactions, a series of bank or commercial transfers, and has been further facilitated through online banking and cryptocurrencies.

According to the UNODC, about USD 2 trillion is laundered every year. Money laundering has various impacts on society. Not only does it slow down economic growth and create monopolies, but it encourages crimes such as drug dealing, human trafficking, and corruption. Further, it disintegrated people’s socio-cultural norms and values.



SDG Choice and Impact Category

SDG 16

The international community recognized the challenges posed by the complexity of illicit financial flows and the need for the recovery and return of stolen assets. In particular, Member States are called upon by 2030 to significantly reduce illicit financial flows, strengthen recovery and return of stolen assets, and combat all forms of organized crime (SDG target 16.4). Organized crime and illicit financial flows erode sustainable development outcomes and undermine the rule of law. GPML’s work counters the threat by helping Member States to implement the Global Goals.”

Impact Category: Processes

Impact assessment

The topic addresses the company’s involvement in money laundering or tax evasion, which are unlawful and fraudulent behaviours. In the financial sector, the topic can also deal with how financial institutions help their clients evade taxes. (Note that evading taxes is not linked only to companies in the financial sector - any company can evade taxes, which should be captured but careful not to mix it up with tax avoidance).

In your analysis about money laundering, consider the following analysis flow that is in alignment with the IMP framework.


To write a strong introduction, you should explain why good corporate governance is crucial and disclose the impact and consequences that money laundering and tax evasion has on society. This would help the readers make an educated assumption about the company's impact, even if it is not directly linked to the company.

Ideally, the geopolitical context of the country the company is having an impact in should be reported.

You should build a strong case by evaluating the general impacts of money laundering or tax evasion by tailoring it to the industry and place to which the company belongs to. It might be hard to pinpoint the concrete impact of these illegal activities, so adding specific information about the context in which the event(s) took place and the more general impacts it is associated with becomes crucial.

Core Analysis

The body of the analysis should answer the following questions:

  • How much money was laundered? How much tax money was evaded?

  • For how long was money laundered or tax evaded?

  • What processes did the company undertake to allow money laundering or tax evasion?

For instance, was the company involved in loan shark operations generating illegal interests? Did it use unlicensed check-cashing businesses? Did it fail to file the Currency Transaction Reports? Did it use insurance wrappers to evade taxes? Or used other tactics to deceive authorities?

  • Was a fine given, and if so, what is its amount? What about a final sentence or prosecution? Please add clear rulings from lawsuits or fines. Note that because lawsuits often take years to complete, the 'scandal' can have occurred over 3 years ago. Go beyond media reports.

You would be able to find concrete data, evidence, and impacts on the lawsuit document, so make sure to add it as a source in your analysis.

  • If discussing a commercial bank or other institution in the financial sector, how many clients did the company help in evading taxes? If available, what is the total amount of taxes evaded?

  • Include reports indicating that the unlawful practices are continuing. A lack of compliance with regulatory requirements or violations of preventive measures could be a good indication that the company is still exposed to money laundering risks.

Note that companies are usually fined for even failing to comply with regulations even if there was no money that was actually laundered.

  • If the case is about money laundering, the proceeds of the illegal funds might be available. If this is the case, please make sure to add data in regards to the person/group/organisation that is laundering the money and how they have affected society.

Important points to consider:

In the core analysis, assess whether the issue is likely to repeat itself. If the company was fined last year for money laundering and/or tax evasion that occurred 5-10 years ago, but in the meantime, it has changed its management and internal processes, such as by training employees adequately and implementing policies and procedures to ensure employees are not the perpetrators/beneficiaries of such practices, then the topic is deemed irrelevant. In other words, there is no impact today.

Note: We ask for clear rulings from lawsuits or fines when discussing money laundering or tax evasion cases. Because the lawsuits often take years to complete, the 'scandal' is deemed outdated (before 2019). However, if reports claim that these bad practices are continuing, showing a poor track record of unlawful behavior, then there is still an impact today, then the analysis can be published.

If the amount of money laundered is available, it is vital to put it into perspective. This can be done by comparing it to the total profits or revenue made by the company in a year.

Note that there is no threshold for the size of the fine, as some courts might be more strict and some more lenient. Therefore, the amount fined does not reflect the size of the crime; it is just an indicator. Though we can assume that the money laundered and fine will be of a large amount (such as USD or EUR 100 Million) when there is a public prosecution.

There are cases where a company can get fined for overlooking anti-money laundering compliance laws, which ultimately permit and facilitates money laundering. Therefore, as the company does not obey the set-out legislations, the impact of money laundering being at a large scale should be captured.

Caution: Money laundering accusations are very serious. Please make sure the sources you use are trustworthy and have a strong reputation. Government documents, as well as sources like Bloomberg, The Guardian, and the Financial Times, are all reliable. Be aware of articles with grammar or spelling mistakes or that are biased.

Read more about avoiding allegations or accusations in our article on the 6th Golden Rule.

Not to include:

  • Allegations or accusations

  • When companies did not implement sufficient anti-money laundering controls

Also, ask yourselves the following questions:

1/ The scale of the impact

  • Are the people concerned deeply affected, or does the issue just marginally impact them?

  • Are the changes brought by the issue profoundly changing society or the planet?

2/ The scope of the impact

  • Is the impact local, national, or global?

  • How many people are concerned?

3/ The irremediability of the impact

  • How long would the impact described last for? Months? Years? Decades?

  • How reversible is the impact described in the impact analysis? Can it be easily stopped/extended?

Find more about evaluating the severity of the impact in Step 5: Assess severity and value.


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