Relationship between money laundering and the balance of payments in the case of Thailand (1990-1997)

Abstract

As economic growth in Thailand is expanding rapidly since 1990,economic crime and fraud is also expanding in corresponding with thegrowth. Not only that, those crime and fraud are adapting and developingnew ways and procedures to cope with new laws and regulations and hidethemselves in the system, which make than very hard to detect. In the study, economic crime and fraud can be classified as thefactor that directly influences the abnormal changes in the error of thebalance of payment. Such influences can be seen as transferring, changing,and others type of activities that snake illegal money or asset to becomelegal one. Those activities are called "Laudrying Money", and theycertainly play essential affect to Thailand net balance of payment. The study shows that Thai economic system does not have effectiverules and regulations to prevent laundrying money both in the bankingsector and the non-banking one. In conclusion, the study suggests that prevention using Offectivelaws and regulations plus getting rid of existing economics crime and fraudwill help narrow down the abnormal fluctuation in the net balance ofpayment. Therefore, support is needed and necessary from all to helpprevent and protect economic crime and fraud from Thai economy