Money laundering

Legitimizing illegal fund transfers

Description

Money laundering is the process of concealing the origins of illegally obtained money by transferring it through complex financial transactions, making it appear legitimate. The essential action involves disguising illicit funds through layering, integration, and placement in legal financial systems. This strategy aims to remedy the risk of detection and asset seizure by authorities, enabling criminals to enjoy the proceeds of crime without arousing suspicion or facing legal consequences.

Context

Between $500 billion and $1.5 trillion (or 5% of gross world product) may be laundered every year, according to the International Monetary Fund.

The most popular sectors for laundering money are import-export companies, restaurants and hotels, retail shops and road transport, and on a larger scale, the property market and construction industry. One favourite method is to use legitimate companies. A reputable but struggling firm that needs a capital injection may be made an offer it cannot refuse. In return for controlling interest or the implanting of a stooge as manager, a gang will bail the company out, gain effective control and trade on the reputation and goodwill the company has built up.

Claim

1. In a world where life is getting increasingly difficult for money launderers, Asia is providing a breathing space. Liberal banking and currency rules and huge money movements due to the region's economic boom make Asia an attractive place to wash dirty cash.