Introduction
This week’s column provides a highly condensed, yet hopefully accurate portrayal of the origins of money laundering, which as we shall observe is a uniquely modern phenomenon. As I have previously noted, tax evasion is the major driver of money laundering both globally, and specifically in the Caricom region (other than in Guyana and to a far lesser extent Jamaica and Trinidad and Tobago) where other criminal pursuits are more apparent.
Historically, the crime of tax evasion appears to have been first legally prosecuted by the United States Government as part of its fight against organized crime over eight decades ago (the famous Al Capone trials of the early 1930s). Money laundering however, as a major organized criminal endeavour first engaged widespread media coverage much later, in the 1970s and early 1980s. Indeed it was only in the early 1980s that the first legal cases against money launderers were prosecuted by the US authorities. It is clear that, from the outset, these cases were closely allied to official onslaughts on major organized crime including, murder for hire, racketeering, and trafficking in narcotics, arms, and persons.
With this brief description, which indicates money laundering first seriously engaged the world’s attention through actions undertaken by the United States Government, let us take a closer look at its economic origins.
Economic origins
There is wide consensus among financial, economic, and international legal analysts that the origins of money laundering are rooted in two economic phenomena. One is the historic distortions that were being perpetuated in the global economy during the 1960s and 1970s, well after the profound economic dislocations of World War II. And the other has