Opening arguments were last Thursday, but the case is already reverberating through the banking industry — and not in ways that would make the world a better place.
As The Times recently reported, bank lawyers say that developments in the case could reinforce an unfortunate trend: the departure of several banks from the business of arranging remittances for immigrant workers, on the ground that the legal risk of inadvertently handling dirty money has become too high.
That would threaten years of progress, spearheaded by the World Bank, to lower the fees on hundreds of billions of dollars in remittances from migrant workers in rich countries to their families in poor countries.
It is crucial for the World Bank not to let that happen. The answer is not to require that banks stay in the game, enduring tighter scrutiny; it is for the World Bank itself to step in and become a remittance center.
Other efforts to foster remittances are helpful, including a recent law signed by President Obama to streamline the regulation of nonbank money transfer businesses. But only the World Bank can broadly transform remittances.
It should do so quickly. Throughout its history, the World Bank has changed along with development challenges. It has gone from making loans to governments to investing in private-sector projects, and from offering loans to making grants and providing insurance. The bank should now rise to the challenges posed by remittances — a critical tool in the fight against world poverty.