Report from the Wild East:

I have participated in a conference titled "Banking and Criminal Law" organized by the International Association of Penal Law (AIDP, http://www.penal.org ) where the following figures were announced for 2005 in Hungary:
Reports by banks and law-firms concerning possible money-laundering: approx. 14000
Investigations initiated by the police: 8
Cases heared at court: 2
Guilty verdicts: 0
At the same time, the estimated volume of money laundering through the Hungarian financial system during the same year: $4 billion.

These figures came as a shock to some of the participants (including myself). This proves that the immensely expensive snooping machinery that requires one or two full-time employees at major branches (the guy dealing with the paperwork required for reporting suspicious cash transactions), which both customers and banks hate, is completely ineffective. Banks were forced into compliance by the regulation that puts the criminal responsibility for money-laundering on the teller, if s/he failed to report it; thus, they end up reporting almost every transaction, just in case. Same for law firms and escrow agencies (these two functions are traditionally performed by the same companies in Hungary).

On the other hand, living without a bank account is nearly impossible in Hungary (for instance, it is illegal to pay salaries in cash for a wide range of jobs) and it is becoming increasingly burdensome to transact without the banks' participation. It's getting worse year by year.

Russia is a completely different story, where the trust in the banking sector is generally low among the general population and large parts of savings are held either at home in cash (exclusively in USD during the nineties, then in Euros and in the past two years increasingly in the local currency, roubels) or lended to trustworthy friends and relatives. Major money laundering is done through off-shore banks, mostly in the baltic states (Russian-owned Latvian banks are the favorites). Even if salaries arrive to bank accounts, people tend to visit the ATM on pay-day to get some cash (most ATMs give both roubles and USD; when ATMs first appeared in Russia, they were dollar-only). Escrow agencies (of which WebMoney is technically one) are very popular in securing p2p or b2b transactions. These are very loosely regulated, use a diverse set of communication channels, and God alone can track all the financial flows. There are just too many of them.