UNITED KINGDOM WILL NOT ABOLISH THE £50 NOTE; SUCH AN ACTION WILL NOT IMPACT MONEY LAUNDERING

UNITED KINGDOM WILL NOT ABOLISH THE £50 NOTE; SUCH AN ACTION WILL NOT IMPACT MONEY LAUNDERING

User Rating: 5 / 5

Star ActiveStar ActiveStar ActiveStar ActiveStar Active
 

The first time that I attempted to purchase a ticket on the Heathrow Express, and learned that one cannot use a £50 note for that purpose, I realized that the fifty was not generally accepted in the UK for all purposes. Recently, government officials have decided against eliminating the fifty Pound note, in what I regard as a wise move, for such an action will not take a bite out of money laundering.

Yes, money launderers engaged in bulk cash smuggling, tax evaders, and those who engage in illicit business, use large denomination currency, but the £50, which is presently worth slightly less than $66, is not a favourite vehicle for that purpose. Frankly, it is too small a value. In Europe, the  €500 note is favoured; outside the EU, it is the USD$100 bill that, due in part to its hard currency status, is preferred. In short, the removal of the fifty Pound note from circulation will not seriously suppress money laundering activities.

A relevant note; most international money laundering takes place using non-cash methods; wire transfers, trade-based money laundering, international product diversion, and real estate purchases and sales. Moving large amounts of value is simply too difficult a task, with elevated dangers of discovery and seizure. Laundrymen today choose methods that are lower risk than bulk cash smuggling. Therefore, we agree with the UK Government action, as the effect of eliminating a high-value note would not effectively stop crime; it would just inconvenience consumers, forcing them to carry more notes, of lesser value, to transact legitimate business. 

Chronicles of Monte Friesner - Financial Crime Analyst 

Contributed by Kenneth Rijock - Financial Crime Consultant