Falling incidence of suspected crime must mean more crime not being suspected

So says Ritchie:

As they then note:

Reports from lawyers of suspicious dealings have slumped in recent years. In 2008, lawyers completed 15,000 such reports out of a total of 225,000, but by 2013 they issued just 4,000 out of a total of 315,000, according to the SRA.

Money laundering is a wide ranging offence and there is a legal obligation on all involved in financial services to report suspicious transactions to the relevant authorities. Suspicion can relate to tax fraud in the UK or elsewhere and suspected proceeds of crime.

It’s ludicrous that the number of suspected reported transactions is as low as it is. I wonder how many accountants really report their clients when they suspect tax fraud? But the number of reports by lawyers is especially odd.

Of course, it couldn’t possibly be that the introduction of a reporting system for suspected money laundering has led to a fall in the amount of money laundering.

Which is a rather odd thing for Ritchie to think really, because he keeps saying that we’ve got to have more reporting, more investigations, in order to bring tax evasion down. But he doesn’t believe that more reporting, more investigations, do actually reduce illegal activity.

Rum that.

5 comments on “Falling incidence of suspected crime must mean more crime not being suspected

  1. This has the ring of truth to it.

    I never met Jimmy Savile, but I understand he was a fiddly bastard so, statistically speaking, I must have been molestered by him.

    I find it suspicious that I haven’t yet reported my suspicions to the authorities. What am I hiding?

  2. “Of course, it couldn’t possibly be that the introduction of a reporting system for suspected money laundering has led to a fall in the amount of money laundering….. he doesn’t believe that more reporting, more investigations, do actually reduce illegal activity.”

    Could be that entirely other thing.
    It’s not as if the drive to stamp out money laundering has been a closely guarded secret, is it? Or that those wishing launder won’t have noticed. So entirely expectedly, those wishing to launder make damned sure their affairs don’t get anywhere near lawyers or accountants likely to welch.
    Seems a lot more likely.

  3. So we’re not having another Morton’s Fork? Lots of report crime == reported crime. Less reported crime == even more reported crime? Really nice exercise of logic here.

  4. Could be an education thing.

    Over time people begin to understand what sort of behaviour is suspicious and what is not.

    After you lodge 100’s of reports and start getting the all clear you begin to understand what is reasonably suspicious and what is not and therefor start to filter out more reports yourself.

    Initially a lot of people were told that they could get thrown in jail for not reporting suspicions at which point everything became suspicious.

  5. AML is the bane of compliance and IR departments everywhere, because it is a lot of work with absolutely no positive impact on the bottom line (other than not being fined). It is taken very seriously indeed and while there are no doubt ways to circumvent it, actual malfeasance on the part of financial institutions is rare, because the penalties to any person or firm found to be engaging in either shenanigans or lax enforcement are so severe (i.e. in serious cases the business will be shut down and the corporate officers jailed.)

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