There are a few basic problems with money laundering regulation: 1. The state wants it done because the intelligence is immensely valuable, not just from a law

There are a few basic problems with money laundering regulation: 1. The state wants it done because the intelligence is immensely valuable, not just from a law enforcement perspective but also from an international realpolitik / Great Game perspective (e.g. think tracking Putin's billions for the US, understanding flow of US Treasuries). This means the state tends to punish missing even a single money laundering lapse severely (which has the side benefit of lining their coffers). 2. Banks and other businesses don't want to do it because it's entirely a cost center to them. This incentivizes them to do the bare minimum to give the appearance of compliance to avoid prosecution while rarely doing the work effectively in practice. Business AML departments also have the problem of often working at cross purpose with the firm's other, frequently more prestigious and connected coworkers (think Goldman's main guy in Asia pushing through the 1MDB transactions). 3. The law pertaining to cooperation across institutions, section 314(b) of the USA PATRIOT Act, is voluntary. Money laundering almost always occurs across multiple institutions and frequently across multiple jurisdictions, many of which are stingy with intelligence or even purposeully opaque (Panama, Singapore, the Caymans, etc). This results in fragmentary and incomplete investigations and intelligence gathering, leading to an enormous amount of wasted and duplicated effort. If the countries of the world were serious about money laundering, they would focus on real cooperation and beneficial ownership requirements. Unfortunately the world's intelligence services all work against each other at one level or another, and they benefit from financial nontransparency (funding operations, obscuring flow of funds e.g. the US Treasury refusing until recently to publish info on Saudi ownership of Treasury bonds). Businesses are swept up in the game and even the few that genuinely seem to want to do the right thing find it impossible to overcome the hypocrisy of the game. As many commenters have noted below, money laundering is not a victimless crime. It aids human traffickers, arms dealers, and drug lords. Unfortunately it also benefits states, and businesses get caught in the crossfire.