Global Statistics About Money Laundering

Global Statistics About Money Laundering

Since ancient times, money laundering has existed as a financial crime. Money laundering offences have evolved, forcing regulatory authorities and global financial institutions to face growing complexities. Therefore, knowing current statistics helps organisations combat money laundering cases through which financial risk arises. In this blog, we’ll discuss global statistics about money laundering while identifying significant risks and AML measures to prevent it. 

Top Money Laundering Statistics by Industry

Below, we’ve mentioned how money launderers affect different business sectors through statistical data, which shows both industry impact scales and vulnerability levels:

1. Financial Services

More than half of money laundering activities in Latin America are conducted by financial institutions. 

Did you know? The financial institution TD Bank paid the largest bank penalty in U.S. history, amounting to $1.3 billion (AED 4.77 billion*), because of violations of the Bank Secrecy Act and money laundering activities in 2024.

2. Cryptocurrencies

Digital currency-based illicit financial activities have experienced astronomical growth in recent years. Their anonymity function allows this activity. Since the launch of Bitcoin in 2009, about USD 4.5 billion (AED 16 billion*) has been laundered through the cryptocurrency.

3. Gaming

Fake gaming profiles enable criminal organisations to transform unlawful funds into virtual currency before exchanging assets. The criminals transfer these purchased items and characters into secondary markets while hiding the illegal source of the funds. A gaming firm in Malta received a €386,000 (AED 1.53 million*) penalty in 2022 because it disobeyed money-laundering rules.

Below, you will find statistics regarding the present global money laundering conditions:

• According to the U.S. Department of the Treasury analysis, approximately $300 billion (AED 1 trillion*) of money laundered globally through criminal financial systems throughout America.
• Financial institutions annually paid $10.4 billion (AED 38 billion*) in expenses for non-compliance with regulatory requirements about AML solutions, KYC, data privacy and MiFID in 2020.
• A total of $21.4 billion (AED 78 billion*) in transactions occurred through illegal channels, as 2.1% of all cryptocurrency transactions occurred in 2019.
• UK experiences $24 billion (AED 88 billion*) in annual costs due to serious and organised crime activities, primarily from money laundering operations.

Cost of Money Laundering Schemes: Financial and Social Impact 

Money laundering is the process of concealing the main source of illegally obtained funds. This global issue creates a significant threat to economic and social systems. Below, we’ll provide illustrations of cost impacts through real-world examples to demonstrate the consequences.

1. Financial costs

Money laundering produces multiple forms of financial instability, damaging national development and systemic financial infrastructure and stability throughout the nation.

Economic Distortion

Property market values become artificially inflated by criminals who use illegal funds to speculate on residential real estate. Many legitimate homebuyers lost the ability to purchase properties in Vancouver, Canada, because of money laundering, thus triggering a housing crisis. Criminal activity forced local families to abandon buying homes in their city because convicted criminals required housing for their image-boosting cash.

Systemic Financial Failures

Banks involved in money laundering operations frequently need to pay substantial fines while bearing significant concerns and damage to their public standing. In 2012, HSBC faced $1.9 billion (AED 6 billion*) in penalties when its branches permitted drug cartels to launder money through their operations. 

The Hong Kong HSBC bank accounts processed $4.2 billion (AED 15 billion*) through money laundering, exposing internal control weaknesses and inadequate disclosure practices across the organisation. The bank suffered financial loss alongside a serious decline in public confidence in the banking sector. 

Lost Tax Revenue

Any funds that undergo laundering operations escape from paying taxes. The lack of taxation on laundered funds enables the reduction of available funds that support public services such as healthcare, education, and infrastructure development. 

A Florida developer who defrauded investors of more than $30 million (AED 110 million*) succeeded in evading $2.5 million (AED 9 million*)  in U.S. income taxes and penalties during July 2023. By exploiting legal entities, the developer purchased several real estate properties by creating separate LLCs.

Reduction in Economic Growth

News of AML scandals leads shareholders and possible investors to initiate changes in their financial actions rapidly. The decrease in stock prices and challenges of obtaining capital emerge due to these events. 

From 1980 to the present day, the flow of illegal funds in Sub-Saharan Africa totalled 1.3 trillion dollars (AED 4 trillion*), which damaged regional advancement and deepened local poverty rates.

2. Social costs

Money laundering creates effects that extend past monetary considerations in financial reports. The economy loses its governmental resources and public trust due to money laundering practices.

Fueled Crime

The criminal activities of money laundering serve as the essential funding source. The Mexican drug cartels use annual drug laundering of $25 billion (AED 91 billion*) to strengthen their operations while they purchase weaponry and bribe public officials. The sequence of violence caused by money laundering resulted in thousands of fatalities while creating chaos throughout specific areas.

Undermined Democracy

The funds from laundering normally end up in political campaign finances, leading to the distortion of democratic processes. Operation Car Wash led to billions of Brazilian laundry funds, which politicians received during the scandal. The disfigured political structure brought about by money laundering produced social unrest across the system.

Exploitation of Vulnerable Populations

The poor and disadvantaged groups become common targets in money laundering schemes. As part of mule accounts and human trafficking operations, criminals confine many innocent individuals. The International Money Fund describes how diminished public services impact population groups that are already vulnerable. 

Economic Inequality

The accumulation of wealth by criminals complicit in money laundering produces an imbalance in wealth that causes economic disparities between criminals and general population members. The huge gap between oligarchs’ wealth and the regular citizen’s financial status causes social instability in Russia because of money laundering operations.

Statistics of Money Laundering by Country

To gain a comprehensive understanding of laundering trends, it is essential to examine statistics from different geographical regions. The statistics about money laundering reveal risk associated with criminal operations and the success rate of effective  anti-money laundering measures that have been conducted:

1. United States

Money laundering persists as a major problem throughout the United States territory. The U.S. Department of the Treasury released the 2024 National Risk Assessments on Money Laundering, Terrorist Financing, and Proliferation Financing to showcase the main threats, vulnerabilities, and risks targeting American society.

The updated risk assessment reports track essential illicit finance threats that develop as the danger conditions modify. The United States occupies the number one spot globally in terms of anti-money laundering (AML) events for every person in its population. The country experiences 3.5 illicit finance events per 100,000 people through more than 11,472 recorded incidents.

The U.S. Department of the Treasury identifies $300 billion (AED 1 trillion*) as money laundered annually, accounting for between 15% and 38% of worldwide money laundering operations.

The deficiencies in anti-money laundering compliance have resulted in US authorities issuing $14 billion (AED 51 billion*) worth of monetary penalties in 2022 as organisations failed to follow AML regulations.

2. United Kingdom

Money laundering accounts for 27.5% of the reported events in the United Kingdom, as the nation has seen a rise in money laundering activities. The United Kingdom has developed powerful measures to combat money laundering. These AML regulations concentrate on validating UBOs (Ultimate Beneficial Owners).

Money laundering events in the United Kingdom reached 1,664 cases, which makes it the second country behind only Kuwait, with 2.5 incidents per 100,000 people. Among all reported anti-money laundering events in the UK during the research period, approximately 77% included money laundering incidents, demonstrating that the country has significant anti-money laundering work.

3. Australia

Drug trafficking in Australia stands as the primary AML event that accounts for almost 40.9 percent of all reported cases. Australian law enforcement agencies implement strict measures to stop money laundering in residential property market activities and diverse money laundering operations.

4. Canada

The Canadian financial sector shows an increased tendency for money laundering activities because AML compliance failures account for 23.9% of total cases recorded. The nation has implemented robust AML protocols to fight money laundering through UBO understanding and verification processes.

Real estate deals and cryptocurrency transactions became linked to increased money laundering activities in Canada. Since these trends emerged, Canada strengthened its AML framework by focusing on real estate operations and digital money laundering. 

5. Germany

The German homeland joins several others which have detected important escalations in money laundering events nationwide. The country proactively acts against money laundering by enhancing AML procedures and building efficient customer onboarding processes.

6. Singapore

The Singapore Business Times reported that authorities expanded their seizure of stolen funds from $2.8 billion (AED 10 billion*) in October to exceed S$3 billion ($2.24 billion).

Fifty-five new houses alongside fifteen cars are under disposal restriction orders that the police have issued based on Business Times reports. The law enforcement authorities worldwide received Interpol Red Notices as part of the arrest warrant effort to locate and detain two individuals. The irregular individuals had already left Singapore before the previous raid took place.

How to Combat Money Laundering and Terrorist Financing?

Financial identity fraud continues to advance among the fastest-growing criminal offences in the modern world. This criminal activity mainly affects banks and financial institutions. The total losses due to these crimes reached $20 billion in 2020.

Synthetic identities are the essential mechanism that enables money laundering crimes to succeed. Criminals establish fake accounts through synthetic identities, which they use to open mule accounts in banking institutions and financial technology platforms. Most illegal funds travel through these money transfer systems.

Professionals who operate on the dark web and access data breaches can acquire SSN information for constructing synthetic identification profiles. Criminals develop new identities by combining details, including birthdates, addresses, and additional information. More sophisticated fraudsters create whole digital representations by constructing social media accounts alongside falsified employment histories.

The FedPayments Improvements report indicates that 1% to 3% of U.S. bank accounts function with synthetic identities, representing about $2.5 million (AED 9 million*) in illicit funds transfers.

Money transactions across numerous accounts hide original funds sources, making it difficult to trace financial crimes. The anticipated cost of synthetic identity fraud until 2030 reaches $23 billion (AED 9 million*).

The situation demands stronger security practices and international cooperation. Identity verification systems that are robust help businesses reduce risks and stop financial criminal activities. AI-driven AML systems reinforce compliance by automating detection processes, confirming KYC regulations, and maintaining continuous observation of transactions.

Moreover, AML systems support regulatory compliance through automation tools combining AI technology, KYC protocols, and transaction surveillance capabilities. Implementation of robust AML measures and efficient customer onboarding solutions will help organisations combat this issue.

Final Words

Statistics about money laundering reveal that global money laundering impacts numerous sectors while damaging economic systems and enabling criminal operations. Different sectors experience ongoing exploitation by illegal money flows, including financial institutions, cryptocurrency, and gaming. To fight such crimes, governments and worldwide regulatory bodies have implemented tightening anti-money laundering procedures while criminals develop their schemes. 

Moreover, money laundering has become a major concern for businesses, requiring them to implement active protection measures. Xpert Advisory provides the solution to this need. Our expert-level AML services provide transaction surveillance, KYC verification, and regulatory compliance systems to stop illicit activity before it escalates. Contact us now to secure your business from financial crimes.

FAQs

Which Percentage of Funds Gets Laundered?

Detecting the total amount of laundered money remains challenging because experts believe the numbers are significant. About 2-5% of global GDP is laundered each year, according to the United Nations Office on Drugs and Crime (UNODC). The annual amount of money laundered ranges between EUR 715 billion and 1.87 trillion (AED 2-7 trillion*).

Which Country Stands on Top in Global Money Laundering Rankings?

MYANMAR stands as the country with the highest worldwide money laundering risks. Haiti ranked second to the Democratic Republic of Congo in the global money laundering list. Moreover, the bottom ten spots contained mostly African nations like Gabon and Guinea-Bissau.

What Is the Current Value of Worldwide Money Laundering Operations?

Money laundered through global transactions reaches an annual rate of $2 trillion (7 trillion AED*), severely impacting economic stability and security levels.Since ancient times, money laundering has existed as a financial crime. Money laundering offences have evolved, forcing regulatory authorities and global financial institutions to face growing complexities. Therefore, knowing current statistics helps organisations combat money laundering cases through which financial risk arises. In this blog, we’ll discuss global statistics about money laundering while identifying significant risks and AML measures to prevent it. 

Top Money Laundering Statistics by Industry

Below, we’ve mentioned how money launderers affect different business sectors through statistical data, which shows both industry impact scales and vulnerability levels:

1. Financial Services

More than half of money laundering activities in Latin America are conducted by financial institutions. 

Did you know? The financial institution TD Bank paid the largest bank penalty in U.S. history, amounting to $1.3 billion (AED 4.77 billion*), because of violations of the Bank Secrecy Act and money laundering activities in 2024.

2. Cryptocurrencies

Digital currency-based illicit financial activities have experienced astronomical growth in recent years. Their anonymity function allows this activity. Since the launch of Bitcoin in 2009, about USD 4.5 billion (AED 16 billion*) has been laundered through the cryptocurrency.

3. Gaming

Fake gaming profiles enable criminal organisations to transform unlawful funds into virtual currency before exchanging assets. The criminals transfer these purchased items and characters into secondary markets while hiding the illegal source of the funds. A gaming firm in Malta received a €386,000 (AED 1.53 million*) penalty in 2022 because it disobeyed money-laundering rules.

Below, you will find statistics regarding the present global money laundering conditions:

• According to the U.S. Department of the Treasury analysis, approximately $300 billion (AED 1 trillion*) of money laundered globally through criminal financial systems throughout America.
• Financial institutions annually paid $10.4 billion (AED 38 billion*) in expenses for non-compliance with regulatory requirements about AML solutions, KYC, data privacy and MiFID in 2020.
• A total of $21.4 billion (AED 78 billion*) in transactions occurred through illegal channels, as 2.1% of all cryptocurrency transactions occurred in 2019.
• UK experiences $24 billion (AED 88 billion*) in annual costs due to serious and organised crime activities, primarily from money laundering operations.

Cost of Money Laundering Schemes: Financial and Social Impact 

Money laundering is the process of concealing the main source of illegally obtained funds. This global issue creates a significant threat to economic and social systems. Below, we’ll provide illustrations of cost impacts through real-world examples to demonstrate the consequences.

1. Financial costs

Money laundering produces multiple forms of financial instability, damaging national development and systemic financial infrastructure and stability throughout the nation.

Economic Distortion

Property market values become artificially inflated by criminals who use illegal funds to speculate on residential real estate. Many legitimate homebuyers lost the ability to purchase properties in Vancouver, Canada, because of money laundering, thus triggering a housing crisis. Criminal activity forced local families to abandon buying homes in their city because convicted criminals required housing for their image-boosting cash.

Systemic Financial Failures

Banks involved in money laundering operations frequently need to pay substantial fines while bearing significant concerns and damage to their public standing. In 2012, HSBC faced $1.9 billion (AED 6 billion*) in penalties when its branches permitted drug cartels to launder money through their operations. 

The Hong Kong HSBC bank accounts processed $4.2 billion (AED 15 billion*) through money laundering, exposing internal control weaknesses and inadequate disclosure practices across the organisation. The bank suffered financial loss alongside a serious decline in public confidence in the banking sector. 

Lost Tax Revenue

Any funds that undergo laundering operations escape from paying taxes. The lack of taxation on laundered funds enables the reduction of available funds that support public services such as healthcare, education, and infrastructure development. 

A Florida developer who defrauded investors of more than $30 million (AED 110 million*) succeeded in evading $2.5 million (AED 9 million*)  in U.S. income taxes and penalties during July 2023. By exploiting legal entities, the developer purchased several real estate properties by creating separate LLCs.

Reduction in Economic Growth

News of AML scandals leads shareholders and possible investors to initiate changes in their financial actions rapidly. The decrease in stock prices and challenges of obtaining capital emerge due to these events. 

From 1980 to the present day, the flow of illegal funds in Sub-Saharan Africa totalled 1.3 trillion dollars (AED 4 trillion*), which damaged regional advancement and deepened local poverty rates.

2. Social costs

Money laundering creates effects that extend past monetary considerations in financial reports. The economy loses its governmental resources and public trust due to money laundering practices.

Fueled Crime

The criminal activities of money laundering serve as the essential funding source. The Mexican drug cartels use annual drug laundering of $25 billion (AED 91 billion*) to strengthen their operations while they purchase weaponry and bribe public officials. The sequence of violence caused by money laundering resulted in thousands of fatalities while creating chaos throughout specific areas.

Undermined Democracy

The funds from laundering normally end up in political campaign finances, leading to the distortion of democratic processes. Operation Car Wash led to billions of Brazilian laundry funds, which politicians received during the scandal. The disfigured political structure brought about by money laundering produced social unrest across the system.

Exploitation of Vulnerable Populations

The poor and disadvantaged groups become common targets in money laundering schemes. As part of mule accounts and human trafficking operations, criminals confine many innocent individuals. The International Money Fund describes how diminished public services impact population groups that are already vulnerable. 

Economic Inequality

The accumulation of wealth by criminals complicit in money laundering produces an imbalance in wealth that causes economic disparities between criminals and general population members. The huge gap between oligarchs’ wealth and the regular citizen’s financial status causes social instability in Russia because of money laundering operations.

Statistics of Money Laundering by Country

To gain a comprehensive understanding of laundering trends, it is essential to examine statistics from different geographical regions. The statistics about money laundering reveal risk associated with criminal operations and the success rate of effective  anti-money laundering measures that have been conducted:

1. United States

Money laundering persists as a major problem throughout the United States territory. The U.S. Department of the Treasury released the 2024 National Risk Assessments on Money Laundering, Terrorist Financing, and Proliferation Financing to showcase the main threats, vulnerabilities, and risks targeting American society.

The updated risk assessment reports track essential illicit finance threats that develop as the danger conditions modify. The United States occupies the number one spot globally in terms of anti-money laundering (AML) events for every person in its population. The country experiences 3.5 illicit finance events per 100,000 people through more than 11,472 recorded incidents.

The U.S. Department of the Treasury identifies $300 billion (AED 1 trillion*) as money laundered annually, accounting for between 15% and 38% of worldwide money laundering operations.

The deficiencies in anti-money laundering compliance have resulted in US authorities issuing $14 billion (AED 51 billion*) worth of monetary penalties in 2022 as organisations failed to follow AML regulations.

2. United Kingdom

Money laundering accounts for 27.5% of the reported events in the United Kingdom, as the nation has seen a rise in money laundering activities. The United Kingdom has developed powerful measures to combat money laundering. These AML regulations concentrate on validating UBOs (Ultimate Beneficial Owners).

Money laundering events in the United Kingdom reached 1,664 cases, which makes it the second country behind only Kuwait, with 2.5 incidents per 100,000 people. Among all reported anti-money laundering events in the UK during the research period, approximately 77% included money laundering incidents, demonstrating that the country has significant anti-money laundering work.

3. Australia

Drug trafficking in Australia stands as the primary AML event that accounts for almost 40.9 percent of all reported cases. Australian law enforcement agencies implement strict measures to stop money laundering in residential property market activities and diverse money laundering operations.

4. Canada

The Canadian financial sector shows an increased tendency for money laundering activities because AML compliance failures account for 23.9% of total cases recorded. The nation has implemented robust AML protocols to fight money laundering through UBO understanding and verification processes.

Real estate deals and cryptocurrency transactions became linked to increased money laundering activities in Canada. Since these trends emerged, Canada strengthened its AML framework by focusing on real estate operations and digital money laundering. 

5. Germany

The German homeland joins several others which have detected important escalations in money laundering events nationwide. The country proactively acts against money laundering by enhancing AML procedures and building efficient customer onboarding processes.

6. Singapore

The Singapore Business Times reported that authorities expanded their seizure of stolen funds from $2.8 billion (AED 10 billion*) in October to exceed S$3 billion ($2.24 billion).

Fifty-five new houses alongside fifteen cars are under disposal restriction orders that the police have issued based on Business Times reports. The law enforcement authorities worldwide received Interpol Red Notices as part of the arrest warrant effort to locate and detain two individuals. The irregular individuals had already left Singapore before the previous raid took place.

How to Combat Money Laundering and Terrorist Financing?

Financial identity fraud continues to advance among the fastest-growing criminal offences in the modern world. This criminal activity mainly affects banks and financial institutions. The total losses due to these crimes reached $20 billion in 2020.

Synthetic identities are the essential mechanism that enables money laundering crimes to succeed. Criminals establish fake accounts through synthetic identities, which they use to open mule accounts in banking institutions and financial technology platforms. Most illegal funds travel through these money transfer systems.

Professionals who operate on the dark web and access data breaches can acquire SSN information for constructing synthetic identification profiles. Criminals develop new identities by combining details, including birthdates, addresses, and additional information. More sophisticated fraudsters create whole digital representations by constructing social media accounts alongside falsified employment histories.

The FedPayments Improvements report indicates that 1% to 3% of U.S. bank accounts function with synthetic identities, representing about $2.5 million (AED 9 million*) in illicit funds transfers.

Money transactions across numerous accounts hide original funds sources, making it difficult to trace financial crimes. The anticipated cost of synthetic identity fraud until 2030 reaches $23 billion (AED 9 million*).

The situation demands stronger security practices and international cooperation. Identity verification systems that are robust help businesses reduce risks and stop financial criminal activities. AI-driven AML systems reinforce compliance by automating detection processes, confirming KYC regulations, and maintaining continuous observation of transactions.

Moreover, AML systems support regulatory compliance through automation tools combining AI technology, KYC protocols, and transaction surveillance capabilities. Implementation of robust AML measures and efficient customer onboarding solutions will help organisations combat this issue.

Final Words

Statistics about money laundering reveal that global money laundering impacts numerous sectors while damaging economic systems and enabling criminal operations. Different sectors experience ongoing exploitation by illegal money flows, including financial institutions, cryptocurrency, and gaming. To fight such crimes, governments and worldwide regulatory bodies have implemented tightening anti-money laundering procedures while criminals develop their schemes. 

Moreover, money laundering has become a major concern for businesses, requiring them to implement active protection measures. Xpert Advisory provides the solution to this need. Our expert-level AML services provide transaction surveillance, KYC verification, and regulatory compliance systems to stop illicit activity before it escalates. Contact us now to secure your business from financial crimes.

FAQs

Which Percentage of Funds Gets Laundered?

Detecting the total amount of laundered money remains challenging because experts believe the numbers are significant. About 2-5% of global GDP is laundered each year, according to the United Nations Office on Drugs and Crime (UNODC). The annual amount of money laundered ranges between EUR 715 billion and 1.87 trillion (AED 2-7 trillion*).

Which Country Stands on Top in Global Money Laundering Rankings?

MYANMAR stands as the country with the highest worldwide money laundering risks. Haiti ranked second to the Democratic Republic of Congo in the global money laundering list. Moreover, the bottom ten spots contained mostly African nations like Gabon and Guinea-Bissau.

What Is the Current Value of Worldwide Money Laundering Operations?

Money laundered through global transactions reaches an annual rate of $2 trillion (7 trillion AED*), severely impacting economic stability and security levels.