Examples Of Money Laundering
Process of concealment
Money laundering is the process that criminals use for the concealment of money that was made by carrying out illegal activities. The money laundering process typically involves a series of activities or transactions that enables money obtained from illegal sources (“dirty money”) to have the appearance of coming from a legitimate source (“clean money”), hence, this is described as “laundering” (or “washing”) the money.
“Dirty money” is, in essence, money that is from an illegitimate source. Dirty money can come from many different activities. Common examples include fraud, bribery, corruption, tax evasion, drug trafficking and other proceeds of crimes. “Dirty money” can be …show more content…
This is because, among other things, money laundering undermines the credibility and public confidence of financial institutions that have assisted in the process. Money laundering also decreases government revenue (such as when tax evasion is involved) and weakens government control over the economy.
The money laundering cycle
Legal practitioners are likely to come across the words “placement”, “layering” and “integration”. These are words that describes the typical three-stage process (also known as the “money laundering cycle”) criminals may use to conceal the source of illegal funds and make funds appear legitimate. It is useful to have working knowledge of these terms as well as the money laundering process when communicating with and advising clients.
• Placement is the introduction of illegal funds into the legitimate financial system. An example of a placement technique is making “structured” cash deposits into bank accounts. In this context, “structuring” involves breaking down larger cash transactions into small amounts in an attempt to avoid triggering mandatory reporting of cash transactions of AUD10,000 or more as required under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (AML/CTF Act): s 43 of the AML/CTF …show more content…
Terrorist organisations often need apparently legitimate sources of money to expand their networks and get support for their cause. Terrorist activities are often financed by laundered money.
AUSTRAC’s report titled “Money laundering in Australia 2011” (http://www.austrac.gov.au/publications/corporate-publications-and-reports/money-laundering-australia-2011) is a useful tool for practitioners because (among other things) it provides an overview of money laundering in Australia, explains the significant money laundering channels as well as the less visible money laundering channels, and includes and indicator of potential money laundering activity.
What is terrorism financing
What is terrorism?
Terrorism is, in essence, the unlawful or threatened use of force or violence against individuals or property. The goal of terrorism is to intimidate or coerce others (such as governments) so as to achieve political, religious or ideological