Looking for a return

It is perhaps the ultimate irony in the anti-money laundering crusade, writes Andrew Cave. The industry, devoted as it is to the movement of cash and software algorithms that help track it, has no shortage of statistics detailing the numbers of suspicious transactions reported, illegal monies seized and criminals prosecuted. However, ask for a detailed cost-benefit analysis of the financial returns from the millions of pounds ploughed into the effort over recent years and what emerges instead are explanations of why their success or failure cannot be expressed in such simplistic terms.

Even the global accountancy firms, most of whom have large teams helping the financial industry comply with anti-money laundering (AML) requirements, are surprisingly silent when asked what mathematical models exist to test whether AML procedures are good value for money.