| Abstract | Risk-based approach is the most important principle for worldwide anti-money laundering and counter-terrorist financing (AML/CFT) in 2012. To have a full understanding of China‘s money laundering (ML) risk, this paper uses Walker’s generated money for laundering model (WGMLM) and modified Walker‘s gravity model (MWGM) to measure China’s yearly money laundering scale and its flow into other 182 countries and districts from 2000 to 2011. It finds that China‘s ML scale estimate to USD59.304 billion, i.e., 4.95% of GDP, in 2000 and USD177.935 billion, i.e., 2.43% of GDP, in 2011. China’s outflow of ML scale is USD58.154 billion and USD169.062, respectively, in 2000 and 2011, and the total of the research period reaches USD1224.684 billion, averaging USD102.057 billion per annum, out of which 68.84% flows to China Taiwan, China Hong Kong, Japan, China Macau, Luxemburg, and other countries or districts. Suggestions are finally offered for policy-makers to improve China’s AML/CFT efforts. |