Advocacy That Puts You First.
Photo of Alicia Lackey

What is money laundering?

On Behalf of | Aug 16, 2022 | Criminal Law |

White collar crimes involve underhanded and illegal financial dealings. Victims of these crimes may not be immediately apparent, but they can cause a lot of harm.

Money laundering is a type of white-collar crime that the FBI defines as taking money made through criminal ventures and moving through the financial system so authorities cannot trace it back to the illegal activities.

Uses

Money laundering is a common activity among criminal organizations. They make money through selling illegal items or other nefarious means. If they would try to spend that money, it could raise the suspicions of law enforcement. To avoid detection and revealing their illegal enterprise, they will use money laundering to cover their tracks.

Benefits

By laundering their money, criminals can not only cover up their activities but also avoid paying taxes on their financial gains. They can also invest the money and use it to help further their criminal enterprise.

Processes

People may launder money through legitimate businesses. They can also do it through financial institutions. They may take advantage of the difficult-to-track digital currency market. Some will buy things they can turn around and sell, such as jewels or real estate. They may also go international and use the global market to move money around without detection.

In any case, laundering money requires putting the money into the financial system in a way that will move it as far from them as possible. They seek to sever the connection they have with it while still being in control and able to access it. Eventually, after the money moves through the process, it returns to the original owner in a form that they hope law enforcement cannot trace back to where it originated.