Introduction
Whenever you think of laundering money you may think of using soap and water before hanging the money on a clothesline to dry. However, this is actually a serious charge that is oftentimes brought up against either a mobster or an organized criminal organization. Laundering money usually results in millions of dollars worth of damage. This is why it is so vital that law enforcement find a way in which to put an end to it.
Money is a very important part of the criminal enterprise. Frequently criminals get involved with crime in order to make money. Usually this money comes from ill-gotten sources though. So whenever the criminal makes this money he then has to figure out a way in which to make the money “clean” again. Only then will they be able to spend it without it being traced back to them and their criminal enterprise. Herein is what laundering money is all about: taking the money that you earn from committing a crime and cleaning it so that it can be spent without drawing attention from law enforcement officers.
Laundering money is relatively easy to do. Usually the criminal will simply transfer the money to the bank under some false pretense. Once the money arrives at the bank it may be transferred through numerous other banks, even to offshore banks in countries with lax regulations, or used to make payments to phony businesses that act as a front to the criminal activity. After this occurs numerous times the money becomes very hard to trace back to the original crime. Now it can be spent without anyone being afraid that they might be prosecuted because the laundering money process has now been successful.
There are numerous locations throughout the world where laundering money occurs. However, more and more criminals are now turning to banks in Africa and Asia for laundering money. Countries like these have fewer safeguards and so theyre prime targets because it is so easy to deposit and withdraw large amounts of money. Usually only big criminal operations transfer money overseas while the smaller criminals tend to keep things local. Thanks to the fact that we now live in the digital age, it is very easy to make these transfers.
Due to the size and scope of this activity it is a major concern for financial institutions and law enforcement agencies alike. By laundering money criminals are able to successfully profit from their illegal activities but they also damage both the reputation and the stability of the financial markets at the same time. There are also ethical dilemmas involved (i.e. after laundering money it may be invested in the community where its used to build infrastructures or support politicians). So while nobody knows for sure just how much money is laundered on a yearly basis (mainly due to the fact that “cleaned” earnings usually are not reported to the IRS), it is still vital for law enforcement agents to be able to put a stop to this activity.
