Short answer Money Laundering Flashcards
What is money laundering?
Money laundering is the process of dealing with the proceeds of criminal activity in such a way as to make the proceeds appear to have been legitimately acquired
What are the three stages of the money laundering cycle?
Placement - Cash enters the financial system.
Example - An offender makes money from selling cannabis and then deposits these proceeds into an associate’s bank account.
Layering - Money is involved in a number of transactions
Example - The associate transfers the money into an account held by a ‘shell’ company that the offender is the director of.
Integration - Money is mixed with lawful funds or integrated back into the economy, with the appearance of legitimacy
Example - The money is declared as revenue for the company, tax is paid, and then the offender pays himself director fees or a salary out of the company account.
Primary purpose of Criminal Proceeds Recovery Act
The primary purpose of the Criminal Proceeds (Recovery) Act is to
establish a regime for the forfeiture of property that has been derived
directly or indirectly from significant criminal activity; or that represents
the value of a person’s unlawfully derived income.
