To begin with, proper incentive structures need to be incorporated into rules and market practice. For example, senior management requires incentive structures which have time horizons that are consistent with the risk profile of the institution.
Here in Europe for example, passporting allows financial institutions to serve the entire internal market from a single Member State. The second aspect I would like to underline is the sheer size of the numbers involved. Nobody knows the aggregate total of money laundering, but several conservative estimates suggest we are talking about at least 2% of GDP.