EVOLUTION OF ANTI-MONEY LAUNDERING LAWS: A COMPARATIVE STUDY

Abstract

Anti-Money Laundering (AML) laws are critical in combating financial crimes, safeguarding global financial systems, and curbing illicit financial flows. Over the past few decades, AML regulations have evolved from reactive to proactive approaches, reflecting the changing landscape of international finance and crime. This study examines the evolution of AML laws across various countries, highlighting key milestones such as the Financial Action Task Force (FATF) recommendations, which have enhanced global cooperation and set international standards for AML efforts. Despite significant progress, challenges in compliance and enforcement persist, particularly for smaller financial institutions with limited resources and in countries with weaker regulatory frameworks. The study also reveals inconsistencies in the scope and definitions of money laundering across jurisdictions, which hinder effective international cooperation. Technological innovations, such as blockchain and artificial intelligence (AI), are emerging as powerful tools for real-time detection of suspicious activities, offering the potential for more proactive and predictive AML measures. The study underscores the importance of harmonizing AML regulations across jurisdictions to close gaps in the global framework. By adopting best practices from leading jurisdictions, leveraging advanced technologies, and fostering international collaboration, countries can enhance their AML frameworks and better protect the integrity of global financial systems. The findings highlight the need for continued innovation, resource allocation, and a unified approach to addressing the evolving threats of money laundering.