The fight against money laundering, terrorist financing and tax fraud - a global policy challenge -The quest for legal certainty, legitimacy and efficiency

Money laundering, terrorist financing and tax fraud are global policy challenges. Rules, standards and guidelines have been elaborated on different policy levels: The global policy level is seconded by regional policy levels. Sometimes there is even a sub-regional policy level (i.e. the European Union). Finally, yet importantly, the individual States legislate themselves and there might even be different policy levels within a given State. The result is a highly complex multi-layered setting. Coordination between the different layers and actors is difficult. Global policies are challenged by the requirements of legal certainty, legitimacy and efficiency. Legal certainty is at stake: There are no globally accepted definitions of money laundering, terrorist financing or tax fraud. Due to an overlapping mixture of hard and soft law rules, it is at first glance not possible to know what rules are applicable to or in a given State. Many different texts must be screened and many questions need to be answered beforehand. Moreover, the relevant legal texts are not a source of clarity, especially for a non-lawyer. Experts originating from a group of States construct legal standards and guidelines. Compliance is checked, again by experts, through evaluation mechanisms. Via naming and shaming even so called non-binding rules are “imposed” at a worldwide scale. There is a shift away from traditional concepts such as State sovereignty. A legitimacy debate has arisen. States might, at an international level, commit themselves to implement global standards, but might in practice promote own interests. Overall efficiency will be assessed on the examples of France and the US, two important States that are members of the most significant international organizations and parties to the essential conventions. Weaknesses and legal loopholes within national systems have been identified via the two case studies. Such gaps affect the efficiency of the global approach.