Friday, June 29, 2012

Show me the Money
Money laundering is the art of making it appear that the proceeds of an illegal activity came from legitimate sources. It is a crime predicated by another crime which is the actual source of the profits obtained. The drug trade, for example, is the largest source of illicit income. To legitimize this income, three steps are usually necessary, to wit: 1. Placement (Cash is introduced into the financial system); 2. Layering (Various transactions are carried out in order to conceal the illicit source); 3. Integration (Profit is acquired from the transactions carried out to hide the illegal source). In a casino, a money launderer can buy chips, play, and then cash in his chips for which he will be issued a check which he deposits in a bank claiming it as casino winnings. Real estate can be bought with illegal earnings at a manipulated price and then sold, the income from which would appear to be legitimate. In a typical cash intensive business like a parking building, a money launderer can easily mix both legally and illegally obtained profits and claim all of it as legitimate income. The total amount of money being laundered annually worldwide is estimated to be more than $500 billion.   
By: Eduardo R. Meneses Jr.

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