draining development.pdf - Khazar University

How Well Do Anti–Money Laundering Controls Work in Developing Countries? 377true, paradoxically, in most grand corruption cases, though rich countriesdo not always help as much as they could. AML is also available forpurely domestic cases, in which offenders try to conceal their criminalincome within the local financial sector.Whether from corruption or not, some alleged proceeds of crime canmake a significant difference to welfare within developing countries,though it may be countered that—as with some Russian oligarch émigrésin the West—people are seeking to buy their immunity from extraditionby courting popular support. Kobi Alexander, an Israeli technologistwhose extradition from Namibia has been sought by the United Statessince 2006 on charges of stock options securities fraud related to his firmComverse Technology (and who agreed to a U.S. Securities and ExchangeCommission civil settlement in 2010 for US$54 million), brought substantial,if disputed funds with him to Namibia and has invested or givenaway millions to finance low-cost high-technology housing projects andendow educational funds for Namibians.Alexander transferred 120m. Namibian dollars (N$16.9m.) from Israel toNamibia and was granted a two-year work permit on a pledge to spendN$300m. in the country. . . . He had invested N$11m. in the country,including N$3.4m. in low-cost housing in the western town of Swakopmund,because of demand created by the opening of the Langer Heinrichuranium mine. . . . Alexander invested another N$5.9m. in an auto-bodyshop business in Windhoek and bought a N$3.5m. house on a golf estate.He also enrolled his children in the 275-pupil Windhoek InternationalSchool, where fees last year ranged between N$18,000 and N$118,000 ayear. . . .“I have invested responsibly and with a view to engaging previouslydisadvantaged Namibians,” Alexander said. 5There is no extradition treaty between Namibia and the United States,and, as of November 2011, Alexander is out on bail of N$10 millionpending a High Court challenge to the United States.In addition to governmental pressures, AML has, in recent times,been regularly supported by large international banks. These have thecapacity to implement the required sophisticated control systems. Theyhave successfully called for an extension of such controls to their smallercommercial competitors (including money transmission businesses),