Money laundering

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Money laundering is the act of hiding the transformation of profits from illegal activity and corruption into "legitimate" assets. The dilemma of illicit activity is accounting for the origin of the outcome of such activities without raising the suspicion of law enforcement agencies. Thus, much time and effort is put into designing strategies that allow for the safe use of these results without increasing unwanted suspicion. Implementing such strategies is generally called money laundering. After money is laundered or "cleaned", it can be used in mainstream economy to accumulate wealth, such as acquisition of property, or other expenses. Law enforcement agencies from many jurisdictions have set up sophisticated systems in an attempt to detect suspicious transactions or activities, and many have set up international cooperation arrangements to help each other in this effort. In a number of legal and regulatory systems, the term "money laundering" has become associated with other forms of financial and business crime, and is sometimes used more generally to include financial system misuse (which involves things like securities, digital currency, credit, and traditional currency), including terrorism financing and the avoidance of international sanctions. Most anti-money laundering laws openly mix up money-laundering (related to sources of funds) with terrorism financing (related to goal funding) when governing the financial system.

Some countries treat obfuscation from a source of money as well as money laundering, whether it is intentional or by simply using a financial system or service that does not identify or track the source or destination. Other states define money laundering in such a way as to include money from activities that will be criminal in that country, even if the activity is legitimate where the actual action took place.

Video Money laundering

Histori

Laws against money laundering were created for use against organized crime during the Prohibition period in the United States during the 1930s. Organized crime receives a huge boost from the ban and a huge source of new funds gained from the illegal sale of alcohol. Al Capone's successful prosecution of tax evasion brought a new emphasis by state and law enforcement agencies to track and seize money, but the existing legislation against tax evasion can not be used when gangsters start paying their taxes.

In the 1980s, the war on drugs caused the government to turn back to money-laundering regimes in an attempt to seize drug crime proceedings to capture the organizers and individuals who ran the drug kingdom. It also has benefits from a law enforcement point of view about changing the rules of inverted evidence. Law enforcers usually have to prove a guilty person to gain confidence. But with money laundering legislation, money can be confiscated and it's up to the individual to prove that the source of funds is legal if they want to refund. This makes it easier for law enforcement agencies and provides a much lower burden of proof.

The September 11, 2001, attacks that led to the Patriot Act in the US and similar regulations around the world, led to a renewed emphasis on money-laundering legislation to combat terrorist financing. The Group of Seven States (G7) uses the Financial Action Task Force on Money Laundering to pressure governments around the world to improve the oversight and monitoring of financial transactions and share this information among countries. Beginning in 2002, governments worldwide increased money laundering and oversight laws and financial transaction monitoring systems. The anti money laundering legislation has become a much greater burden for financial institutions and law enforcement has increased significantly. During 2011-2015 a number of large banks face increasing fines for violations of money laundering regulations. These include HSBC, fined $ 1.9 billion in December 2012, and BNP Paribas, fined $ 8.9 billion in July 2014 by the US government. Many countries introduce or strengthen border controls on carryable amounts of cash and introduce a central transaction reporting system in which all financial institutions must report all electronic transactions. For example, in 2006, Australia regulated the AUSTRAC system and required the reporting of all financial transactions.

Maps Money laundering

Definitions

Conversion or transfer of property, concealment or disguise of the nature of the proceeds, acquisition, possession or use of property, knowing that this is from criminal activity and participating or assisting the movement of funds to make legitimate results is money laundering.

Money earned from certain crimes, such as extortion, insider trading, drug trafficking and illegal gambling is "dirty" and needs to be "cleaned up" to appear to be derived from legal activities, so banks and other financial institutions will deal with no suspicion. Money can be washed with many methods that vary in complexity and sophistication.

Money laundering involves three steps: The first involves putting cash into the financial system in several ways ("placement"); the second involves conducting complex financial transactions to disguise the illegal source of cash ("layering"); and finally, acquire the wealth resulting from illicit fund transactions ("integration"). Some of these steps can be removed, depending on the circumstances. For example, existing non-cash results in the financial system need not be placed.

According to the US Treasury:

Money laundering is the process of producing illegally obtained results (ie, "dirty money") appears legal (ie "clean"). Typically, this involves three steps: placement, coating, and integration. First, unauthorized funds are clandestinely inserted into the legitimate financial system. Then, money is moved to create confusion, sometimes by installing cables or transferring through multiple accounts. Finally, it is integrated into the financial system through additional transactions until "dirty money" appears "clean".

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Method

In Latin America money laundering is primarily linked to drug trafficking and has links to criminal activity, such as crimes related to arms trade, human trafficking, extortion, extortion, smuggling, and corruption of people associated with government. , such as bribery, which is very common in Latin American countries. There is a relationship between corruption and money laundering in developing countries. Latin American economic power is rising rapidly and without support, wealth from illicit traffic has the appearance of legally-obtained profits. With regard to money laundering, the ultimate goal of this process is to integrate illicit capital into the general economy and transform it into legitimate goods and services.

The practice of money laundering uses a variety of channels to certify everything that is achieved through illegal practices. Thus, it has a different technique depending on the country where this illegal operation will be performed:

• In Colombia, multibillion-dollar laundering, originating from drug trafficking, is done through smuggling imports from parallel exchange markets.
• In Central America in countries like Guatemala and Honduras, money laundering continues to increase without adequate legislation and regulation in these countries. Money laundering activities in Costa Rica have experienced substantial growth, primarily by the use of large-scale currency smuggling and investment of drug cartels in real estate, in the tourism sector. Furthermore, the Colon Free Zone, in Panama, continues to be an operating area for money laundering where cash is exchanged for different products which are then put up for sale at prices below production for quick return of capital.
• In Mexico, the preferred technique continues to be foreign currency smuggling, in addition to electronic transfers, bank drafts with Mexican banks and operations in parallel exchange markets.
• Money Laundering in Caribbean countries continues to be a serious problem that seems very dangerous. In particular, in Antigua, Dominican Republic, Jamaica, Saint Vincent and the Grenadines. Citizens of the Dominican Republic who have been involved in money laundering in the United States, use companies dedicated to transferring funds sent to the Dominican Republic in amounts less than $ 10,000 under the use of false names. In addition, in Jamaica, a multibillion-dollar asset laundering case was discovered through a telephone betting operation abroad. Thousands of suspicious transactions have been detected in French overseas territories. Free trade zones like Aruba, meanwhile, remain the preferred area for money laundering. Offshore banking centers, secret bank accounts, and tourist complexes are channels where dishwasher bleaches the proceeds of ill-gotten money.

The casino continues to attract organizations dealing with money laundering. Aruba and the Netherlands Antilles, Cayman Islands, Colombia, Mexico, Panama and Venezuela are considered the top priority countries in the region, due to the strategies used by washing machines.

Economic impacts in the region

The practice of money laundering, among other economic and financial crimes has been better at infiltrating into the economic and political structures of most developing countries resulting in political instability and economic deviations.

Money laundering is still a big concern for the financial services industry. About 50% of Latin American money laundering incidents are reported by organizations in the financial sector. According to the PwC 2014 global economic crime survey in Latin America, only 2.8% of respondents in Latin America claim to have an Anti-Trust/Competition Law incident, compared with 5.2% of respondents worldwide.

It has been proven that money laundering has an impact on financial behavior and macroeconomic performance of industrialized countries. In these countries, the macroeconomic consequences of money laundering are transmitted through multiple channels. Thus, money laundering complicates the formulation of economic policy. It is assumed that the proceeds of criminal activity are laundered by banknotes and coins in the money replacement circulation.

Washing causes a disproportionate change in the relative price of assets that implies that resources are allocated inefficiently; and, therefore, may have negative implications for economic growth, it seems that money laundering is associated with lower economic growth.

The Office of the National Drug Policy Policy of the United States estimates that only in that country, narcotic drug sales represent about 57,000 million dollars annually and most of these transactions are made in cash.

Jurisprudence

Money laundering has increased. The main factor behind the rise of money laundering is the ineffective enforcement of money laundering laws locally. Perhaps because of the lack of interest that has been given to the subject, since the 21st century begins, there is no jurisprudence regarding money laundering or assets, or the conversion or transfer of goods. Even worse, the laws of Latin American countries really do not deal with their studies in depth, as these are issues that concern the whole world and are the subject of seminars, conferences and academic analyzes in different regions of the planet. Now a new figure called the Economic Criminal Law is being implemented, which must be applied in modern society, which has inflicted great damage on the point of affecting the general economy of the states. Nevertheless, developing countries have responded and continue to respond, through legislative measures, to money laundering problems, at the national level, however, money launderers, have taken advantage of a loose regulatory environment, a fragile financial system along with continued civilian and the political turmoil of most developing countries.

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Magnitude

Many regulatory authorities and governments issue estimates every year for the amount of money laundered, either worldwide or in their national economy. In 1996, a spokesman for the IMF estimated that 2-5% of the global economy in the world involves money laundered. The Financial Action Task Force on Money Laundering (FATF), an intergovernmental body set up to combat money laundering, stated, "Overall, it is highly unlikely to produce reliable estimates of the amount of money laundered and therefore FATF does not publish numbers in "Academic commentators also can not estimate the volume of money with any degree of certainty. Various estimates of global money laundering scales are sometimes repeated often to make some people think of them as facts - but no researcher has overcome the inherent difficulties of measuring actively actively hidden practices.

Despite the difficulty in measuring, the amount of money laundered each year reaches billions of US dollars and raises significant policy concerns for the government. As a result, governments and international agencies have made efforts to prevent, prevent, and catch money launderers. Financial institutions have also made efforts to prevent and detect transactions involving dirty money, both as a result of governmental requirements and to avoid the risk of reputation involved. Issues related to money laundering have existed as long as there are large-scale criminal companies. Modern anti-money laundering laws have evolved along with the modern War on Drugs. In more recent times, anti-money laundering legislation is seen as an adjunct to terrorist financing financial crime in which both crimes typically involve the transmission of funds through the financial system (although money laundering relates to where the money came from >, and terrorist financing related to where the money will be to ).

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Electronic money

In theory, electronic money should provide an easy method of value transfer without revealing identity as unracked banknotes, especially wire transfers involving identifiable bank accounts that protect numbers. But in practice, the record keeping capabilities of Internet service providers and other network resource managers tend to thwart that intention. While some cryptocurrencies under recent developments aim to provide more possibility of transaction anonymity for various reasons, the extent to which they succeed - and, as a result, the extent to which they offer benefits to controversial money laundering attempts. Solutions like ZCash and Monero are examples of cryptocurrencies that provide anonymity that can not be exchanged through evidence and/or information obfuscation (ring signatures). Such currencies may be used in online restricted services.

In 2013, Jean-Loup Richet, a researcher at ESSEC ISIS, surveyed new techniques used by cybercriminals in a report written for the United Nations Office on Drugs and Crime. A common approach is to use a digital currency exchange service that converts dollars into a digital currency called Liberty Reserve, and can be sent and received anonymously. The recipient can convert Liberty Reserve currency into cash for a small fee. In May 2013, the US authorities closed Liberty Reserve which imposed its founders and various others with money laundering.

Another increasingly common way to launder money is to use online games. In the growing number of online games, such as Second Life and World of Warcraft, it is possible to convert money into virtual goods, services, or virtual money that can later be changed back into money.

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Money laundering is reversed

Inverted money laundering is a process that disguises the legitimate source of funds that will be used for illegal purposes. This is usually done for the purpose of financing terrorism but can also be used by criminal organizations that have invested in legal business and want to withdraw legitimate funds from official circulation. The uncountable cash received through veiled financial transactions is not included in official financial reporting and can be used to evade taxes, hand over bribes and pay salaries "under the table". For example, in a letter of statement filed on March 24, 2014 at the United States District Court, Northern California, the San Francisco Division, FBI special agent Emmanuel V. Pascau alleges that some people associated with Chee Kung Tong's organization, and California State Senator Leland Yee , engaging in reverse money laundering activities.

The issue of such fraudulent blocking practices ( obnalichka in Russian) has become acute in Russia and other countries in the former Soviet Union. The Eurasian Group on Combating Money Laundering and Financing of Terrorism (EAG) reports that the Russian Federation, Ukraine, Turkey, Serbia, Kyrgyzstan, Uzbekistan, Armenia and Kazakhstan have experienced a considerable depreciation of the tax base and a shift in the balance of money supply for cash. These processes have complex economic planning and management and contribute to shadow economic growth.

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Fight

Anti-money laundering (AML) is a term that is primarily used in the financial and legal industries to describe legal controls that require financial institutions and other regulated entities to prevent, detect, and report money laundering activities. The anti money laundering guidelines have become globally renowned as a result of the formation of the Financial Action Task Force (FATF) and the enactment of the international anti money laundering standards framework. These standards began to have more relevance in 2000 and 2001, after the FATF initiated a process to publicly identify countries lacking in anti-money laundering legislation and international cooperation, a process known as " name and shame ".

Effective AML programs require jurisdiction to criminalize money laundering, provide relevant regulators and oversee the power and tools to investigate; may share information with other countries as appropriate; and requires financial institutions to identify their customers, create risk-based controls, keep records, and report suspicious activities.

Criminalization

The elements of money laundering crime are governed by the United Nations Convention Against Illicit Circulation on Narcotics Drugs and Psychotropic Substances and the Convention Against Transnational Organized Crime. It is defined as being consciously involved in financial transactions with proceeds of crime for the purpose of concealing or disguising the illegal origins of property of the government.

Role of financial institution

While banks operating in the same country in general must follow the same anti-money laundering laws and regulations, the financial institutions of all their anti-money laundering structures are slightly different. Currently, most of the global financial institutions, and many non-financial institutions, are required to identify and report suspicious transactions to financial intelligence units in their respective countries. For example, the bank must verify the identity of the customer and, if necessary, monitor the transaction for suspicious activity. This is often referred to as "get to know your customers". This means knowing the identity of the customer and understanding the type of transaction in which the customer is likely to be involved. By knowing one's customers, financial institutions can often identify unusual or suspicious behavior, called anomalies, which can be an indication of money laundering.

Bank employees, such as tellers and customer account representatives, are trained in anti money laundering and are ordered to report activities they deem suspicious. In addition, anti-money laundering software filters customer data, classifies them based on suspicion levels, and inspects them for anomalies. Such anomalies include substantial and substantial increases in funds, large withdrawals, or transfer of money to the jurisdiction of bank secrecy. Smaller deals that meet certain criteria may also be marked as suspicious. For example, structuring may cause marked transactions. The software also marks the names on the government's "black list" and deals involving hostile countries with the host country. Once the software has mined the data and marked the suspected transaction, it notifies the bank management, which then must determine whether to file a report to the government.

Value of enforcement fees and related privacy issues

The financial services industry has become more vocal about the rising cost of anti-money laundering legislation and the limited benefits they claim it brings. One commentator writes that "[w] facts, anti-money laundering laws have been driven by rhetoric, spurred by bad activism responding to the need to" be seen doing something "rather than with an objective understanding of its impact on predicate crime The social panic approach is justified by the language used - we are talking about fighting against terrorism or the fight against drugs ". The Economist has become increasingly outspoken in its criticism of the rule, especially with reference to countering terrorist financing, referring to it as an "expensive failure", although it recognizes that other efforts (such as reducing identity and credit card fraud) may still be effective in combating money laundering.

No precise measurement of regulatory costs is offset against the hazards associated with money laundering, and given the issue of evaluation involved in assessing such a problem, it is unlikely that the effectiveness of terror financing and money laundering legislation can be determined at any level. accuracy. The Economist estimates the annual cost of anti-money laundering efforts in Europe and North America of US $ 5 billion in 2003, an increase from US $ 700 million in 2000. Government-related economists have noted negative effects significant money laundering on economic development, including undermining the formation of domestic capital, suppressing growth, and diverting capital from development. Due to the intrinsic uncertainty of the amount of money laundered, changes in the amount of money laundered, and the cost of anti money laundering systems, it is almost impossible to know which anti-money laundering system is functioning and which are more or less cost-effective.

In addition to the economic costs of implementing anti-money laundering laws, improper attention to data protection practices may lead to a disproportionate cost to individual privacy rights. In June 2011, the data protection advisory committee to the European Union issued a report on data protection issues related to money laundering and terrorist financing, which identified many violations of the established legal framework on privacy and data protection. The report makes recommendations on how to deal with money laundering and terrorist financing in a way that protects the privacy rights and data protection laws. In the United States, groups such as the American Civil Liberties Union have expressed concern that money laundering rules require banks to report on their own customers, who essentially hand over private business "to state oversight agencies".

Many countries are required by various international instruments and standards, such as the 1988 United Nations Convention against Illicit Traffic in Narcotics Drugs and Psychotropic Substances, 2000 Convention Against Transnational Organized Crime, the 2003 United Nations Convention against Corruption, and the year's recommendation 1989 Financial Action Task Force on Money Laundering (FATF) to enforce and enforce money laundering laws in an effort to stop narcotics trafficking, international organized crime, and corruption. Mexico, which has faced significant increases in violent crime, establishes anti-money laundering controls in 2013 to curb the underlying crime problem.

Global organization

Formed in 1989 by G7 nations, the Financial Action Task Force on Money Laundering (FATF) is an intergovernmental body that aims to develop and promote international responses to combat money laundering. The FATF secretariat is stationed at the OECD headquarters in Paris. In October 2001, the FATF expanded its mission to combat terrorist financing. FATF is a policy-making body that gathers law, finance and law enforcement experts to achieve national legislation and regulatory reforms AML and CFT. By 2014 its membership consists of 36 countries and regions and two regional organizations. FATF works in collaboration with a number of international agencies and organizations. These entities have observer status with FATF, which does not grant them suffrage, but allows them to participate fully in plenary sessions and working groups.

FATF has developed 40 recommendations on money laundering and 9 specific recommendations on terrorist financing. The FATF assesses each member country against this recommendation in its published report. Countries deemed not to be sufficiently compliant with such recommendations will be subject to financial sanctions.

The three major FATF functions associated with money laundering are:

1. Monitor member progress on implementing anti-money laundering measures,
2. Review and report on trends, techniques, and countermeasures, and
3. Promote the adoption and implementation of the FATF anti money laundering standards globally.

The FATF currently consists of 34 member jurisdictions and 2 regional organizations, representing most financial centers throughout the world.

The United Nations Office on Drugs and Crimes maintains the International Money-Information Information Network, which provides information and software for the collection and analysis of anti money laundering data. The World Bank has a website that provides policy and best practice advice to governments and the private sector on anti money laundering issues.

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Anti-money laundering actions by region

Many jurisdictions adopt a list of predicate-specific crimes for money laundering prosecutions, while others criminalize the results of serious crimes.

Afghanistan

The Center for Transactions and Analysis of Financial Statements of Afghanistan (FinTRACA) was established as the Financial Intelligence Unit (FIU) under the Anti Money Laundering and Criminal Legal Outcome as endorsed by the final decision of 2004. The main purpose of this law is to protect the integrity of Afghanistan's financial system and to gain compliance with international treaties and conventions. The Financial Intelligence Unit is a semi-independent body administratively placed within the Afghan Central Bank (Da Afghanistan Bank). The main objective of FinTRACA is to refuse the use of the Afghan financial system for those who obtain funds as a result of illegal activities, and to those who will use them to support terrorist activities.

To achieve its objectives, FinTRACA collects and analyzes information from various sources. These sources include an entity with a legal obligation to submit a report to FinTRACA when suspicious activity is detected, as well as a cash transaction report above the threshold specified by the rule. Also, FinTRACA has access to all relevant Afghan government government information and databases. When this information analysis supports the assumption of illegal use of the financial system, FinTRACA works with law enforcement to investigate and prosecute illegal activities. FinTRACA also works internationally to support its own analysis and investigation and to support the analysis and investigation of foreign partners, to the fullest extent permitted by law. Other functions include training of entities with legal obligations to report information, developing laws and regulations to support the national level AML objectives, and international and regional cooperation in the development of typology and mitigation of AML.

Australia

Australia has adopted a number of strategies to combat money laundering, reflecting most western countries. The Australian Transaction Reporting and Analysis Center (AUSTRAC) is an Australian financial intelligence unit to combat money laundering and terrorism financing, which requires financial institutions and other 'cash dealers' in Australia to report to them suspicious cash or other transactions and other specific information. The Prosecutor-General's Department maintains a list of banned terror organizations. It is a violation of material support or endorsed by such an organization. It is a violation to open a bank account in Australia under a fake name, and strict procedures must be followed when new bank accounts are opened.

The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) is the main legislative instrument, although there are also violations of the provisions contained in the Division 400 of the Criminal Code Act 1995 (Cth). Upon its introduction, it is intended that the AML/CTF Act will be further amended by the second phase of the extended reforms to the specified non-financial business and profession (DNFBPs) including, inter alia, lawyers, accountants, jewelers and real estate agents; however, further reforms have yet to be developed.

The Result of the Crime Act of 1987 (Cth) imposes a criminal penalty on someone engaged in money laundering, and allows for the seizure of property. The main object of the Act is set forth in s.3 (1):

• to deprive people of the results, and the benefits of commission violations,
• to provide foreclosure of property used in or in connection with the commission of the violation, and
• to allow law enforcement authorities to effectively track such results, benefits, and properties.

Bangladesh

The first anti money laundering law in Bangladesh is the Money Laundering Prevention Act, 2002 . It was replaced by the 2008 Money Laundering Prevention Act . Furthermore, the regulation was revoked by the Money Laundering Prevention Act, 2009 . In 2012, the government again replaced it with the Money Laundering Prevention Act, 2012

In the case of section 2, "Money Laundering means - (i) knowingly transferring, altering or transferring proceeds of a crime or property involved in an offense for the following purposes: - (1) concealing or disguising the nature, source, location, or the control of the proceeds of the offense, or (2) assist anyone involved in the commission of infringement of origin to avoid the legal consequences of the offense, (ii) the smuggling of money or property acquired by legal or illegal means to a foreign country (iii) consciously transferring or delivering or (iv) conclude or attempt to conclude financial transactions in such a way that the reporting requirements under this Act may be avoided, ( v) alter or move or transfer the property with a view to instigate or help to predicate o ffence; (vi) acquire, possess or use any property, knowing that the property is the result of a breach of origin; (vii) engaging in such activities so that illegal sources of criminal proceeds may be concealed or disguised; (viii) participate in, associate with, conspire, attempt, conspire, incite or counsel to commit any offense mentioned above.

To prevent the use of this illegal money, the Bangladesh government has introduced the Money Laundering Prevention Act. This law was last amended in 2009 and all financial institutions follow this action. To date there are 26 circulars issued by Bank of Bangladesh under this law. To prevent money laundering, a banker must do the following:

• When opening a new account, the account opening form must be properly filled by all customer information.
• KYC must be filled correctly.
• Transaction Profile (TP) is mandatory for clients to understand the transactions. If required, TP must be updated upon client approval.
• All other necessary documents must be properly collected together with National ID cards.
• If any suspicious transactions are known, the BNI (Anti-Money Laundering Compliance Officer) must be notified and therefore Suspicious Financial Transactions Report (STR) must be filled out.
• The cash department must be aware of the transaction. It should be noted if suddenly large sums of money are stored in any account. The right document is required if there are clients who do this type of transaction.
• Setup, over/under invoicing is another way to launder money. The foreign exchange department should look at this issue carefully.
• If any account has more than 1 million taka transactions in one day, it should be reported in the cash transaction (CTR) report.
• All bank officials must go through all 26 circulars and use them.

Canada

In 1991, the Criminal Act (Money Laundering) Law was enacted in Canada to give legal effect to the FATF Forty Forty Recommendation by establishing records and client identification requirements in the financial sector to facilitate the investigation and prosecution of money laundering offenses. under the Criminal Code and Drug Law and Controlled Material.

In 2000, the Criminal Act (Money Laundering) was amended to expand the scope of its implementation and to establish a financial intelligence unit with national control over money laundering, FINTRAC.

In December 2001, the scope of the Criminal Act (Money Laundering) was re-enlarged with amendments enacted under the Anti-Terrorism Act in order to block terrorist activities by cutting off sources and funding channels used by terrorists in response to 9/11. The Criminal Act (Money Laundering) was renamed to Crime (Money Laundering) Outcome and the Terror Financing Act.

In December 2006, Outcomes of Crime (Money Laundering) and the Terrorist Financing Act were amended further, in part, in response to pressure from the FATF for Canada to tighten money laundering and financing of terrorism laws. This amendment extends client identification, recording and reporting requirements for a particular organization and includes new obligations to report suspicious transaction attempts and transfer of incoming and outgoing international electronic funds, perform risk assessments and apply written compliance procedures with respect to such risks.

This amendment also allows for wider sharing of financial and money laundering information among law enforcement agencies.

In Canada, casinos, money service businesses, notaries, accountants, banks, securities brokers, life insurance agents, sellers and sellers of real estate in precious metals and stones are subject to reporting and record keeping requirements under Crime (Money Laundering) and Laws Terrorist Financing.

European Union

The fourth and latest iteration of the EU money laundering directive (AMLD IV) was published on 5 June 2015, after completing the final legislative dismissal in the European Parliament. The new directive brings the EU anti-money laundering law more in line with the US, which is good news for financial institutions operating in both jurisdictions.

The lack of harmonization in AML requirements between the US and EU has made it difficult to adhere to global institutions that want to standardize Know Your Customer (KYC) components of their AML program across major jurisdictions. AMLD IV promises to further align the AML regime by adopting a more risk-based approach than its predecessor, AMLD III.

However, certain components of its directives, beyond current requirements in both the EU and the US, provide new implementation challenges to banks. For example, more public officials are brought within the scope of the directive, and EU member states are required to create a new list of "beneficial owners" (ie, those ultimately owning or controlling each company) that will impact the bank. AMLD IV becomes effective June 25, 2015.

India

In 2002, the Indian Parliament passed a law called Money Laundering Prevention, 2002. The main purpose of this action was to prevent money laundering and to confiscate property derived from or engage in money laundering.

Section 12 (1) describes the obligations to be met by banks, other financial institutions, and intermediaries

(a) Keep a record describing the nature and value of a transaction, whether the transaction consists of a single transaction or a series of connected transactions, and where this transaction takes place within a month.

(b) Provide information on the transactions mentioned in clauses (a) to the Director within the stipulated time, including the identity records of all clients.

Section 12 (2) provides that the records referred to in sub-section (1) as mentioned above shall be retained for ten years after the transaction is completed. This is handled by the Indian Revenue Tax Department.

The provisions of the Act are often reviewed and various amendments have been submitted from time to time.

Most of the money laundering activities in India are conducted through political parties, corporations and the stock market. This was investigated by the Directorate of Enforcement and the Department of Income Tax of India. According to the Government of India, of the total tax arrears of INR 2,480 billion (about $ 37 billion) around INR 1,300 billion US $ 19 billion) related to money laundering and securities fraud cases.

The bank accountant must record all transactions over Rs. 1 million and retained such records for 10 years. The Bank must also prepare a cash transaction report (CTR) and a suspicious transaction report above Rs. 1 million in 7 days since initial suspicion. They must submit their reports to the Directorate of Enforcement and the Department of Income Tax.

Singapore

Singapore's legal framework for combating money laundering is contained in legal tool patches, its main elements are:

• Corruption, Drug Trafficking and Other Serious Crimes (Seized Benefits) Act (CDSA). This law criminalizes money laundering and imposes a requirement for people to file suspicious transaction reports (STR) and makes disclosure whenever the physical currency or goods exceed S $ 20,000 is brought in or out of Singapore.
• Mutual Assistance in the Criminal Matters Act (MACMA). This law sets the framework for mutual legal assistance in criminal matters.
• Legal instruments issued by regulatory bodies (such as the Singapore Monetary Authority (MAS), in conjunction with financial institutions (FIs) that enforce requirements for customer due diligence (CDD).

The term 'money laundering' is not used as in CDSA. Part VI of CDSA criminalizes the washing of proceeds resulting from criminal offenses and drug tracking through the following offenses:

• Help others retain, control or use the benefits of drug trafficking or criminal acts under the arrangement (whether by concealment, deletion from jurisdiction, transfer to nomination or otherwise) [section 43 (1)/44 ( 1)].
• Concealment, conversion, transfer or deletion from jurisdiction, or acquisition, possession or use of the benefits of drug or criminal transactions [section 46 (1)/47 (1)].
• Concealment, conversion, transfer, or removal from the jurisdiction of others' benefits from drug or criminal transactions [section 46 (2)/47 (2)].
• Expropriation, possession or use of other persons' profits from drug transactions or criminal acts [section 46 (3)/47 (3)].

United Kingdom

Money laundering and terrorist financing legislation in Britain is governed by four Acts of the Constitution: -

• Terrorism Act 2000
• The 2001 Anti-Terrorism, Crime and Security Act
• Results of Crime Act 2002
• Serious Organized Crime and Police Act 2005
• Money Laundering Regulations 2007
• Money Laundering, Terrorist Financing and Funds Transfer (Information on Payers) Regulations 2017
• 2018 Anti-Money Laundering and Sanctions

The Money Laundering Regulations are designed to protect the UK financial system, as well as to prevent and detect crime. If a business is protected by these rules then control is enforced to prevent it from being used for money laundering.

The Results of Crime Act 2002 contains key UK anti-money laundering laws, including those that require companies in "regulated sector" (banking, investment, remittances, certain professions, etc.) to report to the authorities money laundering suspicions by customers or others.

Money laundering is broadly defined in the UK. Basically, any handling or involvement with any outcome of any crime (or money or assets representing the proceeds of a crime) could be a money laundering offense. Ownership of a person for the proceeds of his own crime is included in the definition of British money laundering. This definition also includes activities in the traditional definition of money laundering, as a process that conceals or disguises the proceeds of crime to make it appear legitimate.

Unlike other jurisdictions (especially the US and most of Europe), the violation of money laundering is not limited to the results of serious crimes, nor is there any monetary restriction. Financial transactions do not require money laundering design or UK legal purposes to regard it as a money laundering offense. A money laundering crime under British law does not need to involve money, because money laundering laws include any description assets. Therefore, anyone committing a licensing crime (that is, resulting in some benefit in the form of money or any asset description) in the UK must also be a money laundering offense under British law.

This also applies to people who, in criminal behavior, avoid accountability (such as tax obligations) - which lawyers call "profits in the form of money" - because they are perceived to be earning a sum of money equal in value to avoidable responsibility.

Major money laundering offenses carry a maximum sentence of 14 years in prison.

Secondary regulations were provided by the Money Laundering Act of 2003, replaced by the Money Laundering Act 2007. They are directly based on EU directives 91/308/EEC, 2001/97/EC and 2005/60/EC.

One consequence of the Act is that lawyers, accountants, tax advisors, and insolvency practitioners suspect (as a consequence of information received in the course of their work) that their clients (or others) have engaged in tax evasion or other criminal acts which produces benefits, must now report their suspicions to the authorities (as this requires the suspicion of money laundering). In most circumstances, it is a violation, "giving tipping-offs", for the reporter to inform the subject of his report that a report has been made. These Terms do not require disclosure to the authorities of information received by a particular professional in a special circumstance or where such information is subject to legal professional rights. Other persons subject to this rule include financial institutions, credit institutions, housing agents (which include rent surveyors), corporate trusts and service providers, high value dealers (who receive cash equivalent to EUR15,000 or more for goods sold), and casino.

Professional guidance (submitted and approved by the UK Department of Finance) is provided by industry groups including the Group of Money Laundering Nannies, the Law Society. and the Consultative Committee of Accountancy Bodies (CCAB). However, there is no obligation on the banking institution to routinely report monetary deposits or transfers above the specified value. Instead, reports must be made of all suspicious deposits or transfers, regardless of their value.

Reporting obligations include reporting suspicious gains from behavior in other countries that would become criminals if they occur in the UK. Exceptions are then added for certain legal activities in which they occur, such as bullfighting in Spain.

More than 200,000 reports of alleged money laundering are submitted annually to the UK authorities (there are 240,582 reports in the year ended 30 September 2010. This is an increase of 228,834 reports submitted in the previous year). Most of these reports were submitted by banks and similar financial institutions (there were 186,897 reports from the banking sector in the year ended 30 September 2010).

Although 5,108 different organizations submitted reports of suspicious activity to authorities in the year ended 30 September 2010, only four organizations filed about half of all reports, and the top 20 reporting organizations accounted for three quarters of all reports.

Violations fail to report suspicion of money laundering by others carrying a maximum sentence of 5 years in prison.

On May 1, 2018, the British House of Commons, without opposition, passed the Sanctions and Anti-Money Laundering Bill, which would set the British government's intended approach to exclusion and licensing when the state became responsible for imposing its own sanctions and would also require external tax famous overseas countries such as the Cayman Islands and the British Virgin Islands to make public lists of the lucrative holdings of companies in their jurisdictions by the end of 2020. The law was passed by the House of Lords on 21 May and received the Royal Asset on May 23rd. However, the public registration provisions of the Act face legal challenges from local governments in the Cayman Islands and the British Virgin Islands, who argue that it violates the sovereignty of their Constitution.

Bureaux Changes

All UK Bureaux de change are registered with Her Majesty's Revenue and Customs, which issues a trading license for each location. Bureau of change and money transmitters, such as Western Union outlets, in the UK are included in the "regulated sector" and are required to comply with the Money Laundering Regulations 2007. Checks can be made by HMRC on all Money Services Businesses.

South Africa

In South Africa, the Central Intelligence Finance Act (2001) and subsequent amendments have added responsibility to the FSB to combat money laundering.

United States

The approach in the United States to stop money laundering is usually divided into two areas: precautions and criminal acts.

Prevention

In an effort to prevent dirty money from entering the US financial system in the first place, the United States Congress issued a series of laws, beginning in 1970, collectively known as the Bank Secrecy Act (BSA). This law, contained in sections 5311 to 5332 of Title 31 of the United States Code, requires that financial institutions, which by definition currently include a variety of entities, including banks, credit card companies, life insurance, money service businesses and broker-dealers in securities, to report certain transactions to the US Treasury. Cash transactions that exceed a certain amount must be reported on the currency transaction report (CTR), identifying the individual conducting the transaction as well as the cash source. The legislation initially required all transactions totaling US $ 5,000 or more to be reported, but due to an overly high threshold reporting rate raised to US $ 10,000. The US is one of the few countries in the world that requires the reporting of all cash transactions beyond a certain limit, although certain businesses may be exempt from the terms. In addition, financial institutions should report transactions on Suspicious Activity Reports (SAR) they deem "suspicious", defined as knowing or suspecting that funds are from illegal activities or disguising funds from illegal activities, structured to avoid BSA requirements or do not appear to be serving known business or legitimate purpose; or that the agency is used to facilitate criminal activity. Attempts by customers to avoid BSA, generally by structuring a cash deposit to an amount lower than US $ 10,000 by splitting it up and storing it on different days or at different locations are also illegal.

The financial database created by this report is administered by the US Financial Intelligence Unit (FIU), called the Financial Crimes Enforcement Network (FinCEN), located in Vienna, Virginia. The report is available for US criminal investigators, as well as other FIUs around the world, and FinCEN conducts computer-aided analysis of this report to determine trends and refer to investigations.

BSA requires financial institutions to engage in customer due diligence, or KYC, which is sometimes known in terms as knowing your customers. This includes obtaining a satisfactory identification to provide assurance that the account is the original name of the customer, and have an understanding of the nature and source of the expected money flowing through the customer's account. Other customer classes, such as those with private bank accounts and foreign government officials, should get due diligence because the law considers that these types of accounts are at higher risk for money laundering. All accounts are subject to ongoing monitoring, where internal bank software examines transactions and flags for manual checks that fall outside certain parameters. If a manual inspection reveals that a suspicious transaction, the agency must file a Suspicious Activity Report.

The involved industrial regulators are responsible for ensuring that financial institutions comply with BSA. For example, the Federal Reserve and the Office of the Financial Supervisory Currency regularly check the bank, and may impose civil penalties or refer to matters for criminal prosecution for noncompliance. A number of banks have been fined and prosecuted for failing to comply with BSA. Most notably, Riggs Bank, in Washington D.C., is prosecuted and functionally expelled from business as a result of its failure to impose proper money laundering controls, mainly because it is associated with foreign political figures.

In addition to the BSA, the US imposes control on currency movements across its borders, requiring individuals to report a cash transfer of more than US $ 10,000 on a form called the International Currency Transport Report or Monetary Instrument (known as CMIR). Likewise, businesses, such as car dealers, who receive more than US $ 10,000 in cash need to file a Form 8300 with the Internal Revenue Service, identify the source of cash.

On September 1, 2010, the Financial Crimes Enforcement Network issued advice on "unofficial transfer system" referring to the United States v. Banki .

In the United States, there is a perceived consequence of anti-money laundering (AML) regulations. These unintended consequences include the issuance of FinCEN's "risky business" list, which is widely believed to be an unfairly targeted money service business. The publication of this list and the subsequent downfall, undisbursed banks of adverse MSB, are referred to as Choke Point Operations. The Financial Crimes Enforcement Network issued a Geographic Targeting Order to combat illegal money laundering in the United States. This means that the voluntary insurance companies in the US are required to identify the natural persons behind the companies who pay all the cash in the purchase of residential real estate for a certain amount in certain US cities.

Criminal sanction

Money laundering has been criminalized in the United States since the Money Laundering Act 1986. The law, contained in section 1956 of Title 18 of the United States Code, prohibits individuals from engaging in financial transactions with results resulting from certain specific crimes, known as "invalid activity specified" (SUAS). The law requires that an individual specifically intend to make transactions to hide the source, ownership or control of funds. There is no minimum money limit, and there is no requirement that the transaction successfully disguise the money. "Financial transactions" have been broadly defined, and need not involve financial institutions, or even businesses. Just handing money from one person to another, with a view to disguising the source, possession, location or money control, has been considered a financial transaction under the law. Ownership of money without financial transactions or intent to conceal is not a crime in the United States. In addition to money laundering, the laws listed in section 1957 of Title 18 of the United States Code, prohibit the expenditure of more than US $ 10,000 derived from SUA, regardless of whether the individual wants to disguise it. This carries a lower penalty than money laundering, and unlike money laundering legislation, requires money to pass through financial institutions.

According to records collected by the United States Punishment Commission, in 2009, the US Department of Justice usually sentenced a little over 81,000 people; , about 800 people were punished for money laundering as the main or most serious cost. The Anti-Drug Act of 1988 extended the definition of financial institutions to include businesses such as car dealers and real estate closure personnel and required them to file reports on major currency transactions. Verify the identity of those who purchase monetary instruments in excess of $ 3,000. The Annunzio-Wylie Anti-Money Laundering Act of 1992 strengthens sanctions for violations of the BSA, requires so-called "Suspicious Activity Reports" and abolish the "Forms of Referral Crimes" previously used, requiring verification and recording of wire transfers and establishing the Advisory Group on Confidentiality Bank. (BSAAG). The Money Laundering Act since 1994 requires banking institutions to review and improve training, develop anti-money laundering procedures, review and improve procedures for referring cases to law enforcement agencies, streamline the exemption process on Currency transactions, requiring every business Money services (MSB) to be registered by the owner or the person controlling, requires every MSB to procure

Source of the article : Wikipedia