Moisés Naím / NewsWeek

At first sight, the scandals that brought down Eliot Spitzer, the former governor of New York, and Klaus Zumwinkel, the former president of Deutsche Post (the German corporate behemoth), didn't seem to have much in common. Spitzer fell two weeks ago for hiring prostitutes; Zumwinkel, two weeks before that, for tax evasion. Yet there's a thread that binds them together: money laundering. Both men were brought down by a new system for tracking money that was created in reaction to the 9/11 terrorist attacks—but that has since spread its net far beyond jihadists.

The inquiry into the Emperors Club, a call-girl service, began last year, when a bank, HSBC, reported to U.S. authorities that the accounts of two companies, QAT and QAT Consulting Group, were regularly receiving deposits from questionable sources. Several of the transfers had come from accounts that seemed set up to mask the sender's identity. The investigation ultimately revealed that the person in question wasn't a drug dealer or a terrorist. It was the governor of New York.

That revelation was made possible by new "know your customer" laws passed after 9/11 that also require banks to regularly file SARs: Suspicious Activity Reports. Banks must now know who exactly controls each of their accounts, and must report to the government any questionable transactions.

Zumwinkel's disgrace was also linked to new post-9/11 attitudes toward bank secrecy and the increased willingness to act against it. In his case, agents of the BND, Germany's secret service—empowered by the new culture—paid a former employee of Liechtenstein's main bank, the LGT, €4.2 million for data discs that he'd stolen from his employer. The discs held names of foreigners who'd used LGT accounts to evade taxes in their home countries. Zumwinkel's name turned up on the list, and he was forced to resign amid great scandal.

Liechtenstein has refused to join the post-9/11 trend to tighten money-laundering laws. After the LGT scandal broke, authorities in Germany and elsewhere responded by launching raids, detaining and interrogating those named on the discs—and holding them accountable. Cries to further toughen European laws on money laundering mounted, as did pressure on havens like Liechtenstein, Monaco and Andorra to comply.

These efforts have their detractors. Michael Lauber, director of Liechtenstein's Bankers' Association, was quoted on March 2 saying that money laundering by terrorists and traffickers is not a problem in the principality, and that "we don't consider [tax evasion] a crime."

Other havens seem to agree. Their attitude is that if a country sets taxes too high, evasion becomes inevitable. There will always be certain states, as well as lawyers, straw men, bogus foundations, banks and other institutions willing, for a fee, to help people hide their money. Indeed, despite recent moves to restrict such havens, many countries and banks still compete fiercely for clients by offering confidentiality guarantees and advisory services on how to set up fronts, philanthropies or family trusts—all means of hiding assets.

In the late '90s, even the U.S. Department of the Treasury resisted attempts by the CIA and the FBI to impose stronger controls. "We're only going to scare off foreign investors who will take their money to other countries," one senior Treasury official, who requested anonymity, told me at the time.

Then came September 11. Suddenly power shifted from economists and financial specialists to intelligence agents and counterterrorism experts. Safeguarding the homeland became the priority. "Follow the money" is the mantra. Where do the terrorists get their funds? How do they move them? Where do they keep them? What accounts and corporations are linked to other suspicious accounts, and where? Answering such questions, it was hoped, would not only help identify the 9/11 attackers and their allies, but would also allow authorities to identify other networks and pre-empt future attacks.

The United States and many other countries quickly set about approving strict new laws, creating the most ambitious anti-money-laundering system the world has ever seen. Yet some states rejected the pressure. In other ways, like many post-9/11 measures, the new regime overreached. As well as ensnaring terrorists, it led to the downfall of Spitzer and Zumwinkel—and more big names are likely to follow.

That may sound like a good thing. The problem is that the random capture of a few governors and corporate CEOs is not the main aim of the new system, which should be geared instead at identifying individuals and networks that threaten world security. Even under the current system, research shows that the chances of a money launderer being caught are still slim. By making it easier to snag lesser criminals, the new structure raises the risk that the most dangerous threats will slip through. No system will ever be perfect. But one that was designed in haste, in fear and with the ambition to monitor everything is guaranteed not to do the job.