Money laundering conceals the proceeds of illegal activities as legitimate funds, often through complex financial transactions. It is a serious crime used to legitimize illegal funds, making it difficult for law enforcement to track and seize assets.
Money laundering is often associated with organized crime, drug trafficking, and terrorism financing.
It involves three stages: placement, layering, and integration.
In the placement stage, illegal funds are introduced into the financial system.
The layering stage involves a series of complex transactions to obscure the source of the funds.
The laundered funds are integrated into the legitimate economy in the integration stage.
Money laundering can occur through various financial institutions, such as banks, money transfer companies, and casinos.
Using shell companies, offshore accounts, and anonymous transactions can make detecting money laundering difficult.
Anti-money laundering (AML) laws and regulations have been established globally to combat crime.
Financial institutions are required to implement AML programs and report suspicious transactions to authorities.
The penalties for money laundering can include fines, imprisonment, and forfeiture of assets.