What is 'money laundrying'?

Question

Pls any1 explain it to me thoroughly.....

Answer 1

Money Laundering
Definition


Money laundering can be defined generally as the process of concealing the existence, illegal source, or application of income derived from criminal activity, and the subsequent disguising of the source of that income to make it appear legitimate. Deception is the heart of money laundering: deceiving the authorities by making assets appear to have been obtained through legal means with legally-earned income or to be owned by third parties who have no relationship to the true owner.


The Financial Action Task Force, the Paris-based multinational group formed in 1989 by the Group of Seven industrialized nations to foster international action against money laundering, has agreed to this "working definition" of money laundering:


The conversion or transfer of property, knowing it is derived from a criminal offense, for the purpose of concealing or disguising its illicit origin or of assisting any person who is involved in the commission of the crime to evade the legal consequences of his actions,
The concealment or disguising of the true nature, source, location, disposition, movement, rights with respect to, or ownership of property knowing that it is derived from a criminal offense,
The acquisition, possession or use of property, knowing at the time of its receipt that it was derived from a criminal offense or from participation in a crime.
In general, the U.S. money laundering laws apply to:
· Any financial transaction, or anyone who transports, transfers, transmits a monetary instrument or funds from a place in the United States to or through a place outside the United States, or from a place outside the United States to or through a place in the United States, or attempts to do so,
Involving the proceeds of "specified unlawful activity" defined as proceeds from 176 different federal violations, or represented to come unlawful activity by a law enforcement officer,
Knowing the funds come from some form of unlawful activity,
With the intent to promote an unlawful activity, or evade U.S. taxes, or conceal the ownership of the money or assets, or to cause a report required to be made under federal or state law.

Answer 2

It's making money look legit.

Okay, say you sell a guy a bunch of drugs for $100,000. You can't just go put that money in the bank in cash and not explain it, especially if you are already known to be shady (say, you're in the mafia) because that's a big red flag to the IRS and police.

But then say you also own a restaurant. You can say that 100 more people ate there per night than really did, write out the receipts, all that, but instead you put a couple hundred of that $100,000 in drug money in the till every night. Now that money can go in the bank, because it looks like a legit profit.

Basically, it's making "dirty" money look "clean".

Answer 3

Thats easy

Let's say I have a small buisness, a cafe or whatever. And someone comes to me, a criminal of some sort and has a large amount of money that he or she raised robbing a bank or selling drugs or whatever... He can't take the money to the bank because It would look funny because what if He has no income and wants to deposit 10 or 20 thousand bucks... Well, he gives the money to me, and I deposit the money or if I believe the money is marked or will get spotted, I use some here to pay a bill, there to order some coffee, use some of it to pay an employee. I become like the bank for this guy, when he needs 1000 or whatever he comes to me and I give it to him untill it is payed off. Normaly I would take a small cut of whatever % for myself and that my freind is how money is Laundered.

Answer 4

Taking stolen or otherwise bad money with known serial numbers and using it in smaller amounts to get legitimate unstolen change back that can be used anywhere. If someone counterfeited a $100 bill and was able to use it in a store for a $1 item, the $99 change back is probably legitimate currency.

Answer 5

It's where you take money that was made from a crime (considered 'dirty money') and put it into a legit business before it makes it to the bank - it's like you're washing the money. You would have to 'fix' the books at the legit business to justify the extra income. That way, if the money is ever traced, it looks like you have a legit reason to have it.

Answer 6

Taking money gotten by illegal means and getting it into circulation through a legal entity. Some do it through storefronts, or by depositing it into a bank, or placing it into an investment product then quickly cashing it out. Most financial institutions now have safe guards in place to try and fight money laundering.

Answer 7

Money laundering is the process of taking funds obtained illegally (e.g., via drug trade) and commingling them with funds obtained legally (e.g., investing them in stock of a company, or running them theough a couple of different bank accounts), in order to disguise their illegal nature so that they are available as regular funds. Gangsters and drug dealers do this all the time.

By trading "bad" money for "good" money, one washes the taint of criminality from it, thereby laundering the money.

Answer 8

Well the answer may suprise you. It is cleaning money. Not in a washer but trying to make the money invisible to the IRS. You want to spend it, but don't want anyone to know you have it. This way you don't pay taxes on it.

Answer 9

"Money laundering" is trying to recirculate "dirty", or crime-related money, back into society through a business or bank account. When the money is back in the banking system, it's now "clean."

There are various laws at banks and other places about money laundering. They are aimed at making it harder to dispose of money gained from criminal acts.

Answer 10

the act of taking money that has been gained/earned through illegal channels (fraud, drug-dealing) and filtering it through a legitimate business for the purpose of hiding the true source of the money.

Example: Drug dealer has $50,000 that he wants to deposit into his bank account but doesn't want the FBI to get wind of his drug dealing behavior. He takes the $50,000 and gives it to a friend/business who will then pay him $50,000 for some type of service.