04/10/2020 by On behalf of Law Office of Michael S. Rothman | Aug 11, 2015 | Cyber Crime |
UNDERSTANDING MONEY LAUNDERING
Money laundering happens in nearly every country in the world.
The rise in global financial markets over the years has made money laundering easier than ever, especially with countries’ bank-secrecy laws directly connected to countries with bank-reporting laws. In its simplest form, money laundering is the practice of taking money from one source and making it look like it came from another source. Maryland residents accused of this and other types of cyber crimes should retain counsel immediately.
The basic money laundering crime has three steps-placement, layering, and integration. At the placement stage, the money launderer inserts the dirty money into a legitimate financial institution. This commonly occurs in the form of cash bank deposits. Moving large amounts of cash is generally conspicuous and banks are required to report high-value transactions, so this initial stage is fairly risky.
During the layering phase, the money launderer sends money through various financial transactions to change its form and make it difficult to follow the trail. This stage may consist of several bank-to-bank transfers, wire transfers between different accounts in different names in different countries, and making deposits and withdrawals to continually vary the amount of money in the accounts. This stage is the most complex of a laundering cyber crime, as it is designed to make the original dirty money as difficult to trace as possible.
At the integration stage, money re-enters the mainstream economy in legitimate-looking form. This gives the appearance of a legal transaction. Sometimes, this stage involves a final bank transfer into the account of a local business in which the launderer is investing in exchange for a portion of the profits. At this stage of the cyber attack, the launderer can use the money without getting caught. Money laundering is common in drug trafficking and terrorist activities, as well as in white collar crimes. In the United States, the Department of Justice, the State Department and the Federal Bureau of Investigation all have divisions for handling cyber crime. However, financial systems play a major role in most high-level laundering schemes, so global financial systems also play a part.