Money Laundering


DEFINITION of 'Money Laundering'

The process of creating the appearance that large amounts of money obtained from serious crimes, such as drug trafficking or terrorist activity, originated from a legitimate source.


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BREAKING DOWN 'Money Laundering'

Some estimate the size of the problem is over $500 billion annually. Often thought of as a victimless crime, money laundering is a very serious issue. Without it, international organized crime would not be able to function.

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  1. Why does fighting money laundering reduce overall crime?

    Money laundering is the process of converting funds received from illegal activities into ostensibly clean money that does ... Read Full Answer >>
  2. What methods are used to launder money?

    Money laundering involves three basic steps to disguise the source of illegally earned money and make it usable: placement, ... Read Full Answer >>
  3. If caught, what implications does money laundering have on a business?

    Money laundering is a multibillion dollar industry that impacts legitimate business interests by making it much more difficult ... Read Full Answer >>
  4. Why do brokers ask for personal information before they make any trades?

    According to the Securities and Exchange Commission (SEC), there are three main reasons why a broker will ask for personal ... Read Full Answer >>
  5. What are some high-profile examples of wash trading schemes?

    In 2012, the Royal Bank of Canada (RBC) was accused of a complex wash trading scheme to profit from a Canadian tax provision, ... Read Full Answer >>
  6. What are examples of inherent risk?

    Inherent risk is the risk imposed by complex transactions that require significant estimation in assessing the impact on ... Read Full Answer >>

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