The evolution of money laundering and financial crime: From ‘downright criminal’ to ‘perfectly legal’

From media stories of drug cartels to pop culture hits such as Ozark, money laundering is typically considered a criminal offence. But could there be positive benefits associated with the practice?  

A new course offered at UCalgary's law school explores the evolution of money laundering and financial crime over the past century, as well as the laundering behaviours and practices that lie on the spectrum between “downright criminal” and “perfectly legal,” and the political, economic and historical contexts that make them so.   

According to third-year law student Eric Davies, the course far exceeds the common notion of money laundering proceeds from drug trafficking, like the ones we’ve seen in shows like Ozark and Breaking Bad.

“This course delves into such topics as the theories around financial crimes, how we regulate or facilitate those crimes and the politics of which financial activity we deem illegal. Everyone is sure to find some interest in one of the topics covered in the course.”  

Course grew from professor’s experience as a financial journalist 

Taught by Dr. Sanaa Ahmed, PhD, the course grew out of her experience as a financial journalist, where she watched financial crime unfold in real-time. She also feels that financial crime isn't discussed enough at Canadian law schools.   

“The course explores different ways to think about financial crime beyond the big numbers we see in the news,” explains Ahmed. “I want students to investigate what’s happening behind the scenes, at the intersection of financial regulation and public policy.”  

The course asks students to compare regulatory similarities and differences between Canada, the United States, and the United Kingdom, which are often considered onshore havens for money launderers because of the sophistication of their financial markets.   

“There is a huge demand for these three jurisdictions, and we see some of the most creative examples of financial crime coming out of them,” says Ahmed.  

Course offers practical knowledge for future lawyers 

Indeed, alumnus Duncan Pardoe, BComm’19, JD’22, has experienced first-hand the value of the course now that he’s begun his articles in Vancouver.   

“Through my articles, I have had an opportunity to work with banking and anti-money laundering law, and on every occasion, I have reflected on the research I completed during this course. This course helped better prepare me to assist clients involved with banking, payment, and secured transactional matters.”  

Is money laundering really bad? 

So is money laundering, in fact, a bad thing?  

“After the financial crash of 2007, the UN Office on Drugs and Crime said that money from drugs was the only liquid investment capital available to some banks on the brink of collapse. Without the money from organized crime, the impact of the global financial crisis may have gone into meltdown territory,” Ahmed says.   

She adds that government policies and plans are often designed to solicit money even in our own city. Still, we don’t question where that money is coming from.   

We need to drop the pretense that we don’t like ‘dirty money’ because we all like it; we like all shades of it.

Given the topic, one would expect only students pursuing a career in corporate law to be interested in the course, but the course would also appeal to anyone who knows nothing about financial crime but keeps a finger on the pulse of what’s going on in the world generally.   

“From Enron and SNC Lavalin to The Wolf of Wall Street and sanctions specific to Russia, Iran and Venezuela, money laundering and financial crime are happening all around us. This course will challenge students to think about finance, crime and global politics in a completely different way.”