Money laundering and its Stages

What is Money laundering?

Money laundering is a process of converting illegal money into legal money. It is the process that hides illegal profit without compromising. It is a process of making illegal money using criminal activity like terror funding, drug trafficking and etc. Using ‘money laundering’, the origin of the illegal funds remains hidden and it is finally integrated into the legal economy.

Stages of money laundering

  1. Placement – Here the ‘dirty cash’ is placed in circulation through casinos, shops, financial institutions like Banks.
  2. Layering – In this stage, the distance between the owner and illegal money is increased by sending the money to onshore and offshore accounts.
  3. Integration – Here the money returns to the real owner from the sources that look legitimate. The money is now used to buy properties and high-value items.

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