Here is a great article by David Young that appeared in Newsroom Panama.

NASSAU ,The Bahama’s – WHEN it comes to money laundering and establishing shell companies, it’s the big boys on the block who lay down the rules while they provide the most fertile ground for big time operators seeking to hide  earnings from crime, drugs and corruption.

The message came through clearly at the STEP (Society of Trust and Estate Practitioners) Caribbean Conference in the Bahama’s last week.

Delegates from around the world, heard, and could confirm, that the bigger the banking structure, the easier for those trying to convert or hide money.
The point was underlined this week when Credit Suisse, Europe’s second largest bank, pleaded guilty to enabling American tax dodgers to hide their money, and were ordered to pay the U.S. Treasury over $2.5 billion (about three months of its net earnings) .
Previously HSBC, was accused in the U.S. of failing to monitor billions of dollars of wire transfers and of laundering Mexican and Colombian Drug Cartel money HSBC paid a $1.9 billion settlement, widely regarded as a pittance.
Meanwhile the smaller offshore financial centers struggle to conform to reporting rules laid down by the big players like the U.S. and the OECD to avoid sanctions or appearance on black or grey lists.
Delegates heard too that often before one set of newly minted rules are applied, the game changes and new rules, or variations of the old are introduced.
One of the early speakers was Jason Sharman a world expert on shell companies. Sharman is a professor at Griffith University in Brisbane, Australia, where his research is focused on the regulation of global finance, especially as it relates to money laundering, tax, corruption aAnd offshore financial centers like Panama, The Bahamas, the Cayman Islands and the Virgin Islands, all well represented at the conference.
In a fast moving presentation based on his 7th book, Global Shell Games (co-authored with Michael Findley and Daniel Nielsen) he reported the results of a worldwide investigative  fishing expedition involving the e-mailing of inquiries about setting up companies from 21 fictitious consulting firms to 3,700 corporate service providers. The letters asked  what  documentation needed. The first Letters allegedly originated in high risk like Yemen and Saudi Arabia with terrorist links, and progressed through medium and low risk areas. Quantitative analysis, of responses showed that letters from the high risk inquiries received little response, for requests for more information, but the second and third tier countries elicited replies requiring little or no proof of identity, with the U.S. appearing as the second worst performer by providing easy access. Australia and the UK were also in the easy-lay category. Countries like Jordan and Turkey were among the most cautious.
The survey showed that inquiries from high and low risk areas to OECD countries with celebrity status required less documentation, and often no proof of identity. A transfer of $375 was often enough to ensure registration.
Sharman gave a graphic illustration of a drug cartel running a “shuttle” flight carrying cocaine from Latin America to Guinea-Bissau a hub for onward distribution. The plane had broken down on arrival and was photographed sitting on the runway after its cargo had been transshipped. Investigators checking n’s research showed that the overall level of global compliance was unrelated to FATF (Financial Action Task Force) assessment .The FATF was set up in 1989 by the Group of 7.
In terms of effectiveness rich countries did no better than poor, with smaller countries with little or no say in drawing up the rules, achieving more than those that prepared them.
INFORMATION OVERLOAD
Sharman and other speakers drew attention to the fact that, the bureaucracy was overloaded with information from compliant countries, and that rules introduced by the OECD and the G20 often had political overtones, and by the time the deadlines for implementation were reached, the rules had received amendments, leaving the smaller countries, threatened with sanctions, struggling to comply.

For the small countries like Panama, it seems that the big players are running their own shell game.