The Washington-based Institute for International Economics says the greatly expanded global campaign against money laundering has had only minimal success. Money laundering is the conversion of criminal incomes into assets that cannot be traced back to the underlying crime. Criminal activities associated with money laundering are drug trafficking, the financing of terrorism and embezzlement.

Ted Truman, the former Federal Reserve official who co-authored the report, says the international community lacks a unified anti money-laundering strategy that could break through often conflicting national regulations.

"It so happens it is easier to send money across borders than it is to send police across borders, if you want to put it that way," he said. "That's one of the reasons that no matter where you are and you want to launder the proceeds of your crime, substantially, you send it across the border."

Mr. Truman says that of all countries the United States is the most active in seeking to combat money laundering. But, says co-author Peter Reuter, a criminology professor at the University of Maryland, the United States prosecutes only 2000 money laundering cases annually, obtaining about 1500 convictions.

Professor Reuter says this suggests that only five percent of money launderers are put in jail. The enforcement effort is almost non-existent in Europe where there were a mere 38 convictions last year in Britain and even fewer in Germany. Mr. Reuter says that while no one knows how much money is actually laundered through banks globally, the figure could be as large as $700 billion per year.

Cesare Calari of the World Bank says there have been some successes, including heightened cooperation between U.S. and Mexican authorities.

"So there are a number of solutions that work," he noted. "But they all point to the need to improve efficiency in the form of financial assistance. Because trying to regulate this out of existence won't work."

The World Bank and International Monetary Fund have been handed important roles in combating money laundering. The report's authors say the United States, as the world's principal money laundering jurisdiction, should request a comprehensive IMF/World Bank review of its compliance with global standards on anti-money laundering. Their principal recommendation is that money laundering linked to crimes in other jurisdictions can be prosecuted in all jurisdictions. They also suggest that tax evasion in foreign countries be added to the list of crimes that can lead to money-laundering prosecutions in the United States and other countries.