Do Countries Consistently Engage in Misinforming the International Community about Their Efforts to Combat Money Laundering? Evidence Using Benford's Law.

ABSTRACT: Indicators of compliance and efficiency in combatting money laundering, collected by EUROSTAT, are plagued with shortcomings. In this paper, I have carried out a forensic analysis on a 2003-2010 dataset of indicators of compliance and efficiency in combatting money laundering, that European Union member states self-reported to EUROSTAT, and on the basis of which, their efforts were evaluated. I used Benford's law to detect any anomalous statistical patterns and found that statistical anomalies were also consistent with strategic manipulation. According to Benford's law, if we pick a random sample of numbers representing natural processes, and look at the distribution of the first digits of these numbers, we see that, contrary to popular belief, digit 1 occurs most often, then digit 2, and

SUBMITTER: Deleanu IS 

PROVIDER: S-EPMC5266253 | biostudies-literature | 2017

REPOSITORIES: biostudies-literature