Strategies on anti-money laundering have failed. Here’s how well meaning policies of conscience and coercion locked in systematic failure of anti-laundering laws

The modern anti-money laundering system, which makes banks and other firms check identity documents and scan billions of financial transactions, doesn’t stop crime. Criminals keep up to 99.9% of the earnings from misery, and a scheme meant to ‘protect the financial system’ causes severe social and economic harm. Ronald F Pohl outlines where it all started to go wrong.

Today’s anti-money laundering movement began at a G7 summit in 1989. The seven big industrialized nations circumvented the usual treaty-based consensus to establish an ad-hoc body to use financial flows to help prevent drug trafficking.