01762cas a2200241 a 4500 AALejournalIMF004865 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451866452 1018-5941 BD-DhAAL BD-DhAAL Takats, Elod. A Theory of 'Crying Wolf' : The Economics of Money Laundering Enforcement / Elod Takats. Washington, D.C. : International Monetary Fund, 2007. 1 online resource (54 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The paper shows how excessive reporting, called "crying wolf", can dilute the information value of reports. Excessive reporting is investigated by undertaking the first formal analysis of money laundering enforcement. Banks monitor transactions and report suspicious activity to government agencies, which use these reports to identify investigation targets. Banks face fines should they fail to report money laundering. However, excessive fines force banks to report transactions which are less suspicious. The empirical evidence is shown to be consistent with the model's predictions. The model is used to suggest implementable corrective policy measures, such as decreasing fines and introducing reporting fees. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2007/081 Full text available on IMF http://elibrary.imf.org/view/journals/001/2007/081/001.2007.issue-081-en.xml IMF e-Library