What is money laundering?
Money laundering is a process that criminals use to make it appear that their money was obtained legitimately. The term “money laundering” comes from taking “dirty” money and “cleaning” it for use in the world, hiding where it came from.
When they receive large sums of money, it is not possible for criminals to use them without asking questions. Therefore, they have to hide how and why they got it by coming up with a false legal explanation.
How does money laundering work?
Money laundering is easiest to explain in three steps, but it is often much more complex, especially when you consider the sums involved.
The idea behind money laundering is to make it as difficult as possible for authorities to detect and understand the fraud. Therefore, many examples of money laundering show a diverse web of transactions and accounts, so it is never easy to trace everything back to a starting point.
The more complicated the money ringing, the more likely the criminals will be caught.
- Condition: The first goal of launching a fund is to get the money out into the real world. This is often the most dangerous move of all the work for criminals because it often involves a lot of physical money. Because criminals do not want to leave traces when they, for example, deal drugs or sell weapons, they rarely use cards to do their business. Since, for obvious reasons, no one wants to keep large sums of money on hand, this money must be moved as quickly as possible. This is usually done by “putting” the money in legitimate areas of the economy where the questions are most likely – paying back or giving a loan, changing the money to chips in a casino to make a safe bet, or investing the money in cash. – business only. Other ways include investing in cars or real estate or converting the money into a foreign currency. A criminal often accepts the loss of a small percentage of the total amount in order to maintain the legitimacy of his actions.
- Laying down: Covering means moving money around as often as possible to make the source more difficult. He jumps back and forth between different people, companies and accounts of different sizes and is often moved overseas to muddy the waters. Investments in companies or financial products are not uncommon at this stage either. In this phase, money is moved quickly and frequently, with criminals again accepting the loss of a small percentage of their money to make it even more difficult to identify its ill-gotten gain.
- Integration: The criminal gets his money back, which is now legitimate with his way through the economy. He may get the money returned not in cash, but in the form of property or an expensive work of art, and the sale can then be legally registered. Works of art and buildings are often targeted for money laundering purposes because their value on the open market is subjective.
What is anti-money laundering?
Anti-money laundering (AML) refers to laws, regulations and procedures aimed at preventing, identifying and disrupting transactions involving illegal money. These include customer due diligence (CDD) and customer identity verification (KYC).
Why do banks need to carry out anti-money laundering controls?
All banks must carry out anti-money laundering checks to ensure that the person depositing the money is who they say they are and that the money was obtained legally.
Banks do this because they are heavily regulated. If they are involved in money laundering, even if they don’t know it, they can still be fined heavily. Not only does this have a financial impact on the bank, but it can also damage its reputation.
AML audits can happen at any time, but they are most likely when you make a deposit or deposit. A check does not mean that someone is a suspect; it is not just a precautionary measure and anyone who sends large sums of money will be responsible for verification.
What are anti-money laundering controls?
Anti-money laundering checks are basic checks designed to ensure that the person depositing or depositing money is doing so for themselves through legal means and not on behalf of another person who has received the money. money illegally.
The checks often start with a simple KYC questionnaire which can be cross-checked with the voter register. Alternatively, a person may be asked to verify their identity and address. The following treatments are usually used:
For your identity
- passport
- Driver’s license
- Birth certificate
- National Identity Card
For your address verification
- Driver’s license
- Current electricity bill
- Current bank statement
- National Identity Card
How big is the problem of money laundering?
Because many cases of money laundering are never discovered, it is difficult to accurately determine the true costs.
However, money laundering is a major problem worldwide : It is estimated that between $800 billion and $2 trillion is laundered each year. This is equivalent to 2-5% of global gross domestic product (GDP), a monetary measure of the market value of all goods and services produced each year.
2024-04-29 20:34:42
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