Underground Banking Regulations

Underground banking (also commonly referred to alternative remittance systems or informal value transfer systems) is the movement of money outside the network of banks and money transfer institutions that make up the formal banking system. The term underground banking does not necessarily denote illegal activity. Underground banking can provide a number of legitimate benefits, such as avoiding the unstable financial systems of some countries, getting money to people in remote areas, and avoiding the inefficiency and cost of moving money through formal financial systems. However, national governments are very much concerned about the use of underground banking channels to facilitate a wide range of illegal activities—particularly terrorism but also drug smuggling and cybercrime—and many have enacted regulatory frameworks to deal with individuals and organizations engaged ...