"MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAwith detection of each crime the above stated phase change and this serious crime eventhough detected in many ways by the officials they have been criticized for being mere14 researchers or readers of the report than putting an end to the crime.As understood the process of money laundering is one of the processes for concealing theorigin of illegal money and if this act is performed in a successful manner then the criminalsare benefited by having complete control over the proceeds thus resulting in attractingindividual to perform such act. Below is a brief note about impact of money laundering onbusiness, economy and the society:- Affecting the economic development by reducing revenue to the government andincome of business organisations resulting in increase in tax rates and undermining oftax equity,- Increase in the rate of inflation in the economy,- Increasing the rate of land and buildings,- The criminals infiltrates into the financial institutions and the influence of economicand political criminal organisation can weaken the society fabric,- If this crime is left unchecked then can affect the nation?s economy completely andhave adverse effects on the stability of the global market thus, it is bad for the15 economy and society,- Possible damage to the image of financial institutions and market,- Discourage the foreign investors and increase the ratio of criminal activities,- Result in financial crisis, where the criminals gain the opportunity to take over theprivatisation14Singh Kumar Vijay, Controlling Money Laundering in India – Problems and Perspectives, HidayatullahNational Law University, p.nos 10-1215UNODC , “Global Programme Against Money Laundering”, www.unodc.org.Page 8 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIA- Legal transaction contaminationLITERATURE REVIEWIn a way to reduce the evils of money laundering and increase the focus on AML regimes,different authors have made effective contributions on the subject giving more emphasis onthe reason for failure of AML regulations, AML methods devised by the nations indiscussion, the legal system and their construction and the efficiency and evaluation of theadhered laws etc. The research made by these authors help in the proper progress on thedissertation, and it gives the reader proper idea on the subject of discussion. Firstly, we begin the literature review by analysing the explanation on the concept of money- laundering provided by the “United Nations Office on Drugs and Crime” on its topic “Introduction to Money Laundering” the UNODC begins its research on concept of moneylaundering by beginning with a perfect statement that Money is the chief reason for allcriminal activities and that Money-Laundering is the effective form of covering thesecriminal activities, it is a process that helps the criminals in disguising their illegal activitiesand protect their property. The organisation also explains in its research that moneylaundering does promote organized crimes and corruptions, thus it can be understood thatthrough the analysis made by this organisation, we can properly analyze the concept ofmoney-laundering from layman perspective, and the analysis is made using simple16 terminologies that may help the reader in understanding the concept.Secondly, we organize the dissertation by analysing the works of “Mark Pieth and GemmaAiolfi” in their work “Anti-Money Laundering: Levelling the Playing Field” explained thatthe concept of money-laundering does not have a specific definition but a more descriptive16Introduction to Money Laundering, UNODC; https://www.unodc.org/unodc/en/money- laundering/introduction.htmlPage 9 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAdefinition of the process of money-laundering. The reason to opt this analysis for discussionunder dissertation is the close relation of the purpose of this study and our dissertation that isefforts to combat this phenomenon crime. The research provides in-depth knowledge onevolution of the anti-money laundering paradigm in nations such as Europe, North Americaand the UK, etc. This paradigm has been considered as one of the envisaged tools fordepicting and controlling this illicit activity that had evolved into the most exclusive outletsthe bank institutions and also reduced the illicit trafficking of drugs. Thus, with the help thisstudy we can explain in detail the effect of money-laundering and the different platforms the17 nations have adopted to fight against it.The other essential analysis made by “Ali Alkaabi, George Mohay, Adrian McCullagh andNicholas Chantler” in their work “A Comparative Analysis of the Extent of Money Laundering inAustralia, UAE, UK and the USA” where they have drawn their investigations through the globalestimations made in the past decade to theextent between 2 to 5 percent. The reason for selectingthis research analysis is to get a proper picture on money laundering in the UK, this comparativeanalysis study made among the developed nations that are the spectrum of cultural and economicdevelopment will give in-depth knowledge of the anti-money laundering laws of the UK and theirsuccess ratio in comparison with the other developed and Islamic nations. This will help ourdissertation in explaining the UK laws in a broader horizon in comparison with other developednations. Through this study, it will be easy to detect the challenges UK nation has been facing in18 comparison to other nations for curbing the evils of money laundering.17Pieth Mark and Aiolfi Gemma,Anti-Money Laundering: Leveling the Playing Field, Governance – BaselInstitute of Governance, p.nos 6-9;https://www.baselgovernance.org/sites/collective.localhost/files/publications/biog_working_paper_01.pdf18Alkaabi Ali, Mohay George, McCullagh Adrian and Chantler Nicholas, A Comparative Analysis of the Extent ofMoney Laundering in Australia, UAE, UK and the USA, Information Security Institute, Queensland University ofTechnology, p.nos. 1-13. Page 10 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAFor further analysis, we continue our research through works of “Vijay Kumar Singh – anassistant professor of law in his Controlling Money-Laundering Problems in India –Problems and Perspective.”In his research ethe, the author begins his work with famousquotations from Lewis H. Lapham and Mahatma Gandhi stating that Money is such a toolwhere it?s true meaning depends on the process of use it is out into. Beginning with thisstatement the author continues in explaining in detail the concept of money-laundering with anote on how money is the root cause of this organized crime. He has segregated his analysissectional wise by even giving certain statistical information on the growth of this crime. Thisresearch is very essential as the dissertation concentrates on explaining anti-moneylaundering in India under chapter 3, and this research will help us in analysing the anti-moneylaundering laws in India in detail. It will also help us in providing in-depth detail on the19 problems faced by the nation to overcome this crime.From the perspective view of the AML system the work of “Araujo R” in “Assessing theEfficiency of the Anti-Money Laundering Regulation: An Incentive-Based Approach Journal”is known to be first to use the evolutionary game theory. This theoretical approach explainsthe relation between the banking institutions and the banking employees. In this research theauthor argues that the efficiency of the AML regulations is mainly based on the certainendogenous variables such as the mechanical design of AML, banking institutions and itsemployees and the willingness of AML regulators in implementing the laws. Additionally, hesupports his argument by using the evolutionary game theory which states that the number ofbanks interested in regulating the AML depends even on the number of clerks involved in19Singh Kumar Vijay,Controlling Money Laundering in India – Problems and Perspectives, HidayatullahNational Law University, p.nos. 3-7 Page 11 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAAML. Thus, this topic will help in our dissertation in providing theoretical and realistic20 significance to our analysis in comparing the UK and Indian AML laws.Apart from the above stated literary works of different scholars we would also be consideringthe works “Aliya – Anti-Money Laundering Laws in India: A Brief Overview, Udofia Abbia?s– Recovering Proceeds of Crime – A Comparative Study work of the Nigerian and UK LegalFrameworkand Liz Campbell?s – Organized Crime and the Law: A Comparative Analysis”are some of the additional literature works that would help in proper flow of our dissertation.As we have briefly gone through the different authors and scholar works, we move further indiscussing the approach or methodology implied in the dissertation for analysing the giventopic. METHODOLOGYBy its very nature, it can be understood that being an illegitimate source of income such thatthe organisation or individual earning such income can avoid any penalisation for performingsuch an offence. A collection of essential data plays a vital role in the proper comparativeanalysis for this dissertation. In the current dissertation, we gather information throughgovernment legislation, bank policies and certain research instrumentations involving theparticipation of individuals by gathering their opinion. Also, we gather information fromcertain bank reports and financial statements that are submitted to the central bank of thesenations. Through this essay, we would be providing certain rough estimates for understandingthe different levels this crime has increased to and how it impacts the economic and financial20Araujo, R. (2008) Assessing the Efficiency of the Anti-Money Laundering Regulation: An Incentive-BasedApproach. Journal of Money Laundering Control, 11, 67-75.http://search.proquest.com/docview/235884174/90657AAB58E845E2PQ/1?accountid=42340http://dx.doi.org/10.1108/13685200810844505Page 12 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAposition of the nation. This crime is stung with international flavour thus it can be termed tobe one of those crimes held on a grand scale.The most laws we would be discussing in the later part of the dissertation include the21 Proceeds of Crime Act 2002, the Money Laundering Regulation Act, 2007 ; the Prevention22 of Money-Laundering Act, 2002 ; the Prevention of Money Laundering (Amendment) Bill,23 2011 , additionally we would be also discussing different statues in relation to the abovestated acts that have supported in the effective implementation of these acts in curbing thecrime of money laundering such as Terrorism Act, 2000, Anti-terrorism, Crime and SecurityAct 2001, Serious Organised Crime and Police Act 2005, the Conservation of ForeignExchange and Prevention of Smuggling Activities Act, 1974, the Income Tax Act, 1961, theBenami Transactions (Prohibition) Act, 1988, the Indian Penal Code and Code of CriminalProcedure, 1973, the Narcotic Drugs and Psychotropic Substances Act, 1985, the Preventionof Illicit Traffic in Narcotic Drugs and Psychotropic Substances Act, 1988 etc., Theselegislations of both the nations would be discussed in detail in the next chapters.In addition to the above stated Acts and statues, the dissertation would also focus on certaincase laws that would help in ascertaining the treatment of money laundering and AML in thetwo different nations in question that is their process of identifying the offence of moneylaundering and the technique used and also the section under which their act is punishable.Additional importance is also given to the estimations made globally that help in determiningthe impact of money laundering. As per the findings of International Monitory Fund it can beestimated that the percentage of money laundering affecting the GDP of nations globally isranged between 2 to 5 percent. Money laundering in the UK and India fall within this range21Source: http://www.legislation.gov.uk/uksi/2007/2157/contents/made 22Source: http://fiuindia.gov.in/pmla2002.htm 23Source: http://www.prsindia.org/billtrack/the-prevention-of-money-laundering-bill-2011-2143/Page 13 MONEY LAUNDERING-COMPARATIVE ANALYSIS-THE UK &INDIAof estimations. Providing actual value on how much money is being laundered is a verydifficult work as money laundering is a secretive affair. Although it is difficult to attainaccurate values it has been estimated that over US$300 billion to US$500 billion of money isbeing laundered every year and in India it is being estimated that there is an existence of a24 parallel economy of nearly 40% of its total GDP involved in money laundering and in theUK as per the estimations of HM Customs and Excise, the value of money laundering in theUK is estimated to be between 0.29 to 15 % of the UK GDP as shown in the below table.24Scott, David. 1995. “Money Laundering and International Efforts to Fight It. Public Policy of the PrivateSector,” Public Policy for the Private Sector, Note No. 48, The World Bank. Available at:http://www.worldbank.org/html/fpd/notes/48/48scott.pdf; Quirk, Peter J. 1997 “Money Laundering:Muddying the Macroeconomy.” Finance and Development. International Monetary Fund. March. Vol. 34, No.1, p. 8. Available at: http://www.imf.org/external/pubs/ft/fandd/1997/03/pdf/quirk.pdf. Even-Zohar, Chaim,Indian Parliament Moves to Finally Implement Money Laundering Laws, see Alagiri, see supra note 19, p.86 Page 14 "