A financial institution with a reputation for shady dealing will be shunned by legitimate enterprise. The prestige of even a major bank that is revealed to have assisted in the laundering of money can be severely damaged. Money laundering is bad for business. An international financial centre that is used for money laundering can become an ideal financial haven . An international financial centre perceived to be opening its doors to drug traffickers' cash and organized crime will eventually fail to keep the accounts of major legitimate corporations because they fear tarnishing their own reputation by association.
Money laundering is bad for development.
Left unchecked, money laundering can erode a nation's economy by changing the demand for cash, making interest and exchange rates more volatile, and by causing high inflation in countries where criminal elements are doing business. The siphoning away of billions of dollars a year from normal economic growth poses a real danger at a time when the financial health of every country affects the stability of the global market. Money laundering is bad for the economy. Most disturbing of all, money laundering empowers corruption and organized crime. Corrupt public officials need to be able to launder bribes, kick-backs, public funds and, on occasion, even development loans from international financial institutions.