Losing the War Against Dirty Money: Rethinking Global Standards on Preventing Money Laundering and Terrorism Financing

Following a brief overview in Part I.A of the overall system to prevent money laundering, Part I.B describes the role of the private sector, which is to identify customers, create a profile of their legitimate activities, keep detailed records of clients and their transactions, monitor their transactions to see if they conform to their profile, examine further any unusual transactions, and report to the government any suspicious transactions. Part I.C continues the description of the preventive measures system by describing the government\u27s role, which is to assist the private sector in identifying suspicious transactions, ensure compliance with the preventive measures requirements, and analyze suspicious transaction reports to determine those that should be investigated. Parts I.D and I.E examine the effectiveness of this system. Part I.D discusses successes and failures in the private sector\u27s role. Borrowing from theory concerning the effectiveness of private sector unfunded mandates, this Part reviews why many aspects of the system are failing, focusing on the subjectivity of the mandate, the disincentives to comply, and the lack of comprehensive data on client identification and transactions. It notes that the system includes an inherent contradiction: the public sector is tasked with informing the private sector how best to detect launderers and terrorists, but to do so could act as a road map on how to avoid detection should such information fall into the wrong hands. Part I.D discusses how financial institutions do not and cannot use scientifically tested statistical means to determine if a particular client or set of transactions is more likely than others to indicate criminal activity. Part I.D then turns to a discussion of a few issues regarding the impact the system has but that are not related to effectiveness, followed by a summary and analysis of how flaws might be addressed. Part I.E continues by discussing the successes and failures in the public sector\u27s role. It reviews why the system is failing, focusing on the lack of assistance to the private sector in and the lack of necessary data on client identification and transactions. It also discusses how financial intelligence units, like financial institutions, do not and cannot use scientifically tested statistical means to determine probabilities of criminal activity. Part I concludes with a summary and analysis tying both private and public roles together. Part II then turns to a review of certain current techniques for selecting income tax returns for audit. After an overview of the system, Part II first discusses the limited role of the private sector in providing tax administrators with information, comparing this to the far greater role the private sector plays in implementing preventive measures. Next, this Part turns to consider how tax administrators, particularly the U.S. Internal Revenue Service, select taxpayers for audit, comparing this to the role of both the private and public sectors in implementing preventive measures. It focuses on how some tax administrations use scientifically tested statistical means to determine probabilities of tax evasion. Part II then suggests how flaws in both private and public roles of implementing money laundering and terrorism financing preventive measures might be theoretically addressed by borrowing from the experience of tax administration. Part II concludes with a short summary and analysis that relates these conclusions to the preventive measures system. Referring to the analyses in Parts I and II, Part III suggests changes to the current preventive measures standard. It suggests that financial intelligence units should be uniquely tasked with analyzing and selecting clients and transactions for further investigation for money laundering and terrorism financing. The private sector\u27s role should be restricted to identifying customers, creating an initial profile of their legitimate activities, and reporting such information and all client transactions to financial intelligence units

Evaluation of Tweedie exponential dispersion model densities by Fourier inversion

The Tweedie family of distributions is a family of exponential dispersion models with power variance functions V (μ) = μ^p for p not between (0, 1). These distributions do not generally have density functions that can be written in closed form. However, they have simple moment generating functions, so the densities can be evaluated numerically by Fourier inversion of the characteristic functions. This paper develops numerical methods to make this inversion fast and accurate. Acceleration techniques are used to handle oscillating integrands. A range of analytic results are used to ensure convergent computations and to reduce the complexity of the parameter space. The Fourier inversion method is compared to a series evaluation method and the two methods are found to be complementary in that they perform well in different regions of the parameter space

U.S. PERSPECTIVES ON EAST ASIAN ECONOMIC INTEGRATION

USA only major trade power with equal economic stakes in all regions, and will oppose Asian economic integration if it excludes USA. Charts show relatively declining US role, rising China role as key trade partner for Japan, Korea, ASEAN. Responding to China¡¯s lead, as in its ASEAN trade deals, and shaped by former USTR Zoellick, there is growing US support for bilateral trade agreements, including Korea-US FTA, though most economists oppose bilateral/regional approach as inconsistent with the WTO-multilateral trade format. From US perspective, prognosis for East Asian economic integration not good.Economic Integration, APEC, FTA, ASEAN, Asian Economy, CAFTA, WTO

Distributed digital signal processors for multi-body structures

Several digital filter designs were investigated which may be used to process sensor data from large space structures and to design digital hardware to implement the distributed signal processing architecture. Several experimental tests articles are available at NASA Langley Research Center to evaluate these designs. A summary of some of the digital filter designs is presented, an evaluation of their characteristics relative to control design is discussed, and candidate hardware microcontroller/microcomputer components are given. Future activities include software evaluation of the digital filter designs and actual hardware inplementation of some of the signal processor algorithms on an experimental testbed at NASA Langley

A fluorometric method for the estimation of tryptophan

The various colorimetric methods now employed for the estimation of tryptophan are not specific for tryptophan but give colored products with many compounds containing the indole nucleus, including indole itself. In order to facilitate studies of the enzymatic synthesis of tryptophan from indole and serine by extracts of Neurospora (1), a search for a rapid, quantitative method for the estimation of tryptophan in the presence of indole was undertaken. Tauber (2) reported that tryptophan gives a green fluorescence when treated with 70 to 72 per cent perchloric acid at room temperature. Modification of this procedure has led to a method for the rapid estimation of tryptophan, without preliminary extraction of indole, in hydrolyzed or unhydrolyzed tryptophan-containing materials