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Define money laundering
Concealment or disguise of the true nature, source, location, ownership, etc knowing that it is derived from a criminal offense
Define "willful blindness"
Deliberate avoidance of knowledge of the facts, willful indifference
Difference between money laundering and terrorist financing
Money laundering - derived from criminal activities
Terrorist financing - may include funds from perfectly legitimate sources used to finance acts of terrorism
Stage of money laundering
Placement
Layering
Integration
Physical disposal of cash or other assets derived from criminal activity - placing funds into circulation through banks, casinos, shops, etc
Examples of placement
Breaking up large amounts of cash into smaller sums and depositing them directly into a bank account
Transporting cash across borders to deposit in foreign banks or to buy high-value goods that can be resold for payment by check or wire
Separation of illicit proceeds from their source by layers of financial transactions intended to conceal the origins of the proceeds. Converts proceeds into another form, creating complex layers of financial transactions to disguise audit trail, source and ownership of funds
Examples of layering
Sending wires to/from accounts
Converting deposits cash into monetary instruments
Reselling high-value goods and prepaid access/stored products
Investing in real estate and legitimate businesses
Placing money in investments such as stocks, bonds or life insurance
Using shell companies
Effects of ML and terrorist financing on emerging markets
Increased crime and corruption
Undermining the legitimate private sector
Weakening financial institutions
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