Re:PayPal faces lawsuit for freezing customer accounts and f...
by FabHK on Friday January 14, 2022 @10:57AM
(#29936012)
> an explicit cost at least an order of magnitude higher than what is actually recovered.
The goal is not to make money with AML laws, but to deter and prosecute crime (which has huge externalities itself). Is it effective at that? Your comment doesn't address that.
Re:PayPal faces lawsuit for freezing customer accounts and f...
by edoceo on Friday January 14, 2022 @11:07AM
(#29936165)
If it's only capturing 1% of the dirty money it's not effective at deterring nor is it an effective part of the prosecution.
Re:PayPal faces lawsuit for freezing customer accounts and f...
by nulbyte on Friday January 14, 2022 @03:15PM
(#29939765)
That poses the potential problem of circular reasoning. How do we arrive at this estimate of 1%? Maybe it is more than 1% of the actual value because the estimate is wrong.
Re:PayPal faces lawsuit for freezing customer accounts and f...
by pgwhalen on Monday January 17, 2022 @11:05AM
(#29967954)
Consider this scenario: current AML practices catch 1% of laundered money, but deter additional money laundering 100x. In effect, this means nearly all money laundering is stopped because of these practices.
That seems extreme to me, but it does seem possible.
If this analysis[1] is to be believed, AML laws recover less than 1% of estimated laundered funds, at an explicit cost at least an order of magnitude higher than what is actually recovered.
That's not even including the implicit costs, e.g. when innocent people get caught up and lose their accounts or even their funds.
Travesty doesn't even begin to cover it.
[1] https://www.ledgerinsights.com/anti-money-laundering-has-les...