E‐trade and money laundering: countering schemes and patterns

Reviews briefly the apparent inevitability of growth in electronic trade; the constraining factors seem to be security risks such as problems of transparency and symmetry of information, the need for defence from intrusive technologies and against threats from fraud, embezzlement, counterfeiting, false identities and privacy. Relates e‐trade to the preferences of money launderers for the internet because of its low transparency, multiplier effects, low control, and high risks. Outlines three types of strategy for confronting money laundering: adapting current procedures, developing countering IT techniques like encryption, and singling out possible patterns of suspicious transactions for intermediaries’ consideration. Concludes that existing machinery cannot be expected to curb the transition to an electronic future, and that a combination of strategies is necessary.