Tom DeLay was indicted on money laundering charges, forcing him to step down as House Majority Leader. A Colombian official sat down with people in the U.S. People with a whole lot of dirty money typically hire financial experts to handle the laundering process. So the next question is: What are authorities doing to prevent money laundering? It’s complex by necessity: The entire idea is to make it impossible for authorities to trace the dirty money while it’s cleaned. They launder the money so authorities can’t trace it back to them and foil their planned attack. This method typically works in one of two ways: The launderer can combine his dirty money with the company’s clean revenues – in this case, the company reports higher revenues from its legitimate business than it’s really earning; or the launderer can simply hide his dirty money in the company’s legitimate bank accounts in the hopes that authorities won’t compare the bank balance to the company’s financial statements.
Layering: He then transferred the money from Panama to more than 100 bank accounts in 68 banks in nine countries in Europe, always in transactions under $10,000 to avoid suspicion. The “recommendations” are really more like rules than friendly tips. Within the United States, there are two primary methods employed by the government to detect and combat money laundering: legislation and law enforcement. Integration: The plan was to send the money to Colombia, where Santacruz-Londono would use it to fund his numerous legitimate business there. This complex setup relies on the fact that there are businesspeople in Colombia – typically importers of international goods – who need U.S. Developing countries often bear the brunt of modern money laundering because the governments are still in the process of establishing regulations for their newly privatized financial sectors. In a separate trial, he will be prosecuted for money laundering. The alleged laundering scheme involved sending corporate donations from Texas to the Republican National Committee (RNC) headquarters in Washington D.C., and the RNC then sending an equal amount of money back to Texas for use in campaigning. Money laundering is a ubiquitous practice.
In the 1990s, numerous banks in the developing Baltic states ended up with huge, widely rumored deposits of dirty money. Placement: Antar made a series of separate deposits to a bank in Israel. Layering may consist of several bank-to-bank transfers; wire transfers between different accounts in different names in different countries; making deposits and withdrawals to continually vary the amount of money in the accounts; changing the money’s currency; and purchasing high-value items (boats, houses, cars, diamonds) to change the form of the money. Since the money was in the form of loans rather than income, he wasn’t obliged to pay taxes on it. Otherwise, they can’t use the money because it would connect them to the criminal activity, and law-enforcement officials would seize it. At this point, the criminal can use the money without getting caught. Also, legitimate small businesses can’t compete with money-laundering front businesses that can afford to sell a product for cheaper because their primary purpose is to clean money, not turn a profit. They may use large businesses like brokerage firms or casinos that deal in so much money it’s easy for the dirty stuff to blend in, or they may use small, cash-intensive businesses like bars, car washes, strip clubs or check-cashing stores.
Structuring deposits: Also known as smurfing, this method entails breaking up large amounts of money into smaller, less-suspicious amounts. And while digital money is state-of-the-art, that doesn’t mean that it can’t ultimately be tracked. Cocaine that’s worth $1 million on a New York street weighs about 70 pounds (30 kilograms), while a stash of U.S. Its popularity is due to its wide acceptance and the volume of worldwide transactions that use the currency – a few million extra dollars changing hands doesn’t attract attention. The operation ended with 40 arrests and the seizure of $10 million in drug proceeds and 3,600 kilograms of cocaine. Still, more than 190 jurisdictions worldwide have signed up to follow the FATF’s Recommendations. Still, the authorities are keeping a close eye on developments. The variety of tools available to launderers makes this a difficult crime to stop, but authorities do catch the bad guys every now and then.