It has been found that every year the money launders scrub as much as 2 trillion dollars which is equal to the 5% of the world’s GDP. This global issue caused by money laundering is greatly damaging the world economies and its impact on developing countries is much greater than in other countries for several reasons:
- Firstly, most of the developing countries are in a phase of developing their economic policies so that stability could be maintained in order to safeguard their economies from harm. The weak roots of policy-making and implementation make it easier for criminals to do money laundering.
- Secondly, the financial sectors in the developing countries are the prime target where the clean money of people other than criminals is also in danger. In order to save their clean money, bank patrons withdraw their money as quickly as possible which causes the collapse of banks.
- Thirdly, at the beginning of the introduction of money laundering in the economy, law enforcement does not try to address the problem. When the crime rate reaches a high rate, official law enforcement start to show interest after all the damage is caused to the economy.