-->

• Money laundering is the act of taking illegal money ("dirty" money) and putting it through a cycle of transactions that “washes” the funds and “cleans” them, making the money look like proceeds from legal activities. A money launderer is a person or a group that either has possession of the proceeds of a crime or of the assets that represent the proceeds of illegal activities such as fraud, theft, drug trafficking, or any other crimes.

• Fast Facts

  1. Money laundering is illegal
  2. International problem, international co-operation is critical in the fight against it
  3. Anti-money laundering standards have been established for all countries
  4. [http: //www.fatf-gafi.org/pages/0,2987,en_32250379_32235720_1_1_1_1_1,00.html FATF] was established by the G-7 Summit in Paris in 1989 as a co-coordinated international response

• Smurfing

  1. Dividing a large transaction in many smaller ones to avoid suspicion
  2. A person or group deposit money in to different banks at different times small parts of a large sum
  3. Avoids the scrutiny which large sums attract
  4. Term derived from the cartoon characters, The Smurfs, who lived in a large group of many small entities
  5. Aka: Structuring

• Offshore Money Laundering

  1. Money transferred from account to account
  2. Final deposit made in a country where laws guarantee a lack of scrutiny

• Legitimate/Fake Companies

  1. Use of legitimate companies: "dirty" money mixed with "clean" money derived by legitimate activities
  2. Casinos are notorious targets for money laundering given the "cash heavy" transactions
  3. Use of fake companies: payment for services that were actually never provided

• Prevention in U.S.

  1. 1970: Bank Secrecy Act established
  2. This act aimed to detect and prevent money laundering
  3. 1986: Congress passed Money Laundering Control Act
  4. The act recognizes money laundering as a federal crime
  5. Office of the Comptroller of the Currency established to enforce the finance laws

• Related Pages on Mahalo

  Mexican Mafia | Russian Mafia | Triads | Yakuza

Categories

• View History
• Discuss on the Message Board
• Embed this Page
• Share this page