Money Laundry and its Political Impact

The offence of money laundering due to its nature which is organized and supranational is having damaging economic and, political and social effect on society. Money laundering leads to organized penetration of criminals into banking and monetary network and they bring the economic potential of governments under their own control and direction. With gradual decline of government economic power which is due to non-performance of productive works and tax evasion, the security and economic and political authority of the government and national sovereignty is jeopardized. This destabilizing function generally takes place in developing countries. The main question raised by present article is that, what are the negative impacts of money laundering on society? Money laundering is having damaging economic, political and social impacts. Money laundering is damaging for economy and commerce. The negative impacts of money laundering includes weakening private sector, destruction of financial markets, reduction of government revenue, weakening of economic security, risking credits, hampering healthy competition. Money laundering damages social and economic order because this phenomenon has enormous negative consequences for free competition, stability and health of financial system.