To Launder or not to Launder: Are there Positive Effects for the Economies of Countries who Launder Money?

This paper empirically examines corporate money laundering/gambling activities from a financial perspective – the impact of money laundering/gambling on firms’ financial performance. We specifically address whether the firms associated with money laundering suffer any short or long-term effects on their financial performance following the pubic release of money laundering activities. Our findings suggest that the firms that engage in money laundering/gambling activities perform better after the relative news of their money laundering becomes public (all countries except Canada).