US President Joe Biden has declared multiple times, during his electoral campaign and since he entered into office, that the fight against corruption and money laundering in the United States and globally is a core national security priority and an important part of his “foreign policy for the middle class.”

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Biden intends to clamp down on the cryptocurrency industry, which is often described as “the Wild West,” to fight the global money-laundering chains and to highlight corruption as the greatest threat to democracies.
The change of attitude in the White House is well felt in the Middle East. The region’s rulers will have to adjust – or lose credibility and the support of the US administration – while the US will have to choose between its vital interests and a consistent foreign policy.

The money-laundering challenge

In 2020, seven Middle Eastern countries, some in the Gulf and others in North Africa and the Levant, were starring in the top 50 list of the Basel AML Index that ranks money-laundering and terrorist financing risks around the world. This phenomenon is certainly not new. However, it seems that due to new technologies and the rise of cryptocurrencies, money laundering has become easier and more accessible than ever before.
The recently leaked Pandora Papers shed more light on the incredible level of state-led corruption in the Middle East. One of the “stars” of the AML Index was Turkey, well-positioned at No. 41 between Barbados and Macao. In recent years Recep Tayyip Erdoğan’s AK Party has been severely hit by a series of corruption allegations, including money laundering, drug trafficking, and arms smuggling, while the state-run Halkbank was charged with taking part in a multibillion-dollar scheme to evade US sanctions on Iran. Earlier in October, the US Court of Appeals in New York ruled that Halkbank can be prosecuted over these accusations. After a few days, the international Financial Action Task Force (FATF) took action. READ MORE

Implications of Biden’s crusade against money laundering - analysis

Josh Toupos

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