The blacklist instrument represents the cornerstone of the international effort to reduce the risks that single countries or territories became havens for money laundering activities. But is this institutional device effective? It has been argued that the overall result of the blacklisting mechanism is positive, since transparency regarding which countries do not comply has important effects in the financial markets, increasing the market pressures on the NCCT countries. But why is it, then, that various jurisdictions, notwithstanding the blacklist threat, delay or fail to change their rules, confirming their non-cooperative attitude (reluctant friend effect)? Furthermore, it is true that most jurisdictions placed on the black list have enacted regulatory measures in an effort to be removed from it. But is regulatory reform sufficient to prove that a country has really changed its non-cooperative attitude (false friend effect)? Perhaps the key problem is that discussions on these often take as a given that some countries offer financial services to terrorism and organized crime by adopting lax financial regulations. In other words, lax financial regulation is treated as an independent variable. Therefore, any regulatory reform consistent with the international standards is sufficient to prove that the country is attempting to become a cooperative jurisdiction, while it fails to explain, for example, why specific countries continue in their non-cooperative attitude, notwithstanding the blacklist stigma. This chapter takes a different perspective. We develop the assumption that lax financial regulation may be a strategic dependent variable for national lawmakers seeking to maximize the net benefits produced by any public policy choice. Therefore, given the structural features and endowments of their own countries, lawmakers may it find profitable to adopt financial regulations that attract capital of illicit origin (money laundering services) or destination (terrorism finance services), therefore choosing to be a NCCT jurisdiction.