Why Do I Think It Is A Macroeconomics Issue?

As a consequence, the government have to enact more strict laws to avoid losing hundreds of billions dollars money of taxes. There are two primary ways to alter this problem including manufacturing small money and stop using cash, for it is a potential way to prevent from informing fake income. The most potential solution that the government can alter this situation is to force everyone to use credits or debits for all purchasing transactions. Take India as a typical example to illustrate this

According to Hopton (2009), the Bank Secrecy Act of 1970 was created in order to prevent money laundering. The act was made to try to discourage illegal acts such as money laundering from happening and to deter the criminals from even thinking about committing the crime. Woods (1998) stated that money laundering was not a criminal offense at the time the Bank Secrecy Act was passed. The act provides information on the movement of money through financial institutions in the United States and it monitors the movement of money into and out of the United States. It requires banks and other financial businesses to help the government in trying to prevent and detect money laundering. The federal government law enforcement agencies use the information gathered through the Bank Secrecy Act to detect criminal activities and regulatory violations. These businesses are required to keep track of all of their cash transactions of ten thousand dollars and more and report them to the IRS within forty five days. These transactions could include anything such as deposits, withdrawals, exchanges, payments, multiple transactions in one day and any cash deposits over the weekend or holidays (Woods, 1998). They also have to identify individuals who are requesting these large transactions and keep any records that relate to their transactions.

Counterfeiting, Drug Trafficking, Extortion, Fake Pharmaceuticals, Human Trafficking and Weapon Smuggling are all furtive actions that are inextricably linked to that of Money Laundering. When money is obtained from these illicit actions, individuals must find a way for the money to be “cleaned” or “laundered” so as not to raise suspicion. Individuals usually turn to projects such as Real Estate, Investment in precious metals, creation of fake companies and even Gambling to avoid authorities’ suspicion.

Anti-money laundering programs can help to combat terrorism. Terrorists may receive money from legal or illicit sources. Before they buy an airline ticket or spend money on terrorist activities, the money has to be funneled into accounts that look legitimate. If Osama Bin Laden's bank account had been used to buy an airline ticket or purchase excessive amounts of fertilizer, it would have been flagged. If an account owned by Sallie Jones buys fertilizer for ABC Greenhouse, it appears less

We must make sure that organised crime cannot launder its funds through the banking system or the gambling sector… Our banks should never function as laundromats for mafia money, or enable the funding of terrorists”.

The FATF is an intergovernmental organization established in 1989 to issue policies (“Recommendations”) related to the combating money laundering. However, in 2001, its mission expanded to deter terrorist financing with the

Explain the concept of potential output and why actual output can differ from potential output?

Money Laundering has a close nexus with organized crime. Money Launderers accumulate enormous profits through drug trafficking, international frauds, arms dealing etc. Cash transactions are predominantly

“Money laundering”, is a term that is often used in association with illegal activities, especially in terms of terrorist actions. Many news reports in televisions and newspapers have used the term money laundering but still, the general public do not have enough knowledge of what money laundering is and the corresponding effects upon society. In line with this, there is also a need to further study the processes that are involved in money laundering in order to properly address the aforementioned illegal action. Being the case, there is a need to define the term money laundering and its relevance to important social issues. Moreover, due attention should also be given in the ways or means by which money laundering can be efficiently

Based on the estimation from the International Monetary Fund, the amount of global money laundering is approximately 2.1-3.6 trillion a year, accounting for about 3 to 5 percent of global GDP. Launching regulations and laws related to anti-money

In order to build an effective system in the fight against money laundering it is essential for banks and financial institutions to take strict measures and procedures represented by controlling them, and for that Simwayi and Wang (2011) found that commercial banks in Zambia have gen-erally complied with the Bank of Zambia AML directives of 2004 and they have taken AML laws and

Question A The term economic cycle typically refers to fluctuations in production, trade, unemployment, spending, and economic measures over the course of a time period. In capitalism, these fluctuations usually occur between expansion and boom period (rapid economic growth) and periods of decline or stagnation (recession or contraction). They do not follow a predictable pattern and have a number of variables associated. Capitalism, whether simply the term used as Adam Smith's ideal system or the modern trading of wealth and goods/services needs three things to be successful: a market, a means of production, and natural product. The market may be created (we now have multibillion dollar companies that do nothing but create want), or necessary (certain foods, etc.). The means of production is most usually technological, at least in societies that have advanced; and the natural resources may be human or physical. Because of the volatility and number of variables, it is natural that cycles occur.

Global governance is made up of different assortment of regulatory entities that facilitate decision making and administrative activities facing member states. Such bodies include Basel Committee that regulate and supervise banking sector through of the territories of the member states. This committee liaises between governments of the member countries, the secretariat of the global governance entities, trading and financial institutions. The government bodies are interested in coordinating specific mechanisms regarding accountability, legitimacy, and transparency (Jackson, 2008). However, they emphasize on transparency, bureaucratic participation, reasoned decisions, and accessibility to assessment mechanisms. Therefore, they focus on circumvention of unnecessary measures and illegitimate avoidance expectations (Busch & Reinhardt, 2003).

The IMF is also having an important role to fight against money laundering as well as terrorism (IMF, 2014a).

The global financial system (GFS) is the financial system consisting of institutions and regulators that act on the international level, as opposed to those that act on a national or regional level. The main players are the global institutions, such as International Monetary Fund and Bank for International Settlements, national agencies and government departments, e.g., central banks and finance ministries, private