Has one ever wondered how a criminal can enjoy his profit without being exposed? If a criminal wants to enjoy his money successfully, he knows he has to hide the true proceeding of his wealth. Since there are criminals doing misdeeds for a financial motive, there has been ways to disguise the real origins of the profits. It was not until the 20 century when a formal term was imposed to this act. Even though the famous Al Capone was incarcerated because of tax evasion (actually considered as money laundering charges, too), he needed to make his money seems as legal money so the police won’t have any reason to suspect him. However, the situation for money launderers is not the same as Al Capone’s. If Al Capone was alive, he would need a…show more content… There is not an exact version of where the term money laundering comes from, but there is a theory that affirms the term was first used and recognized internationally in the 1970’s, after the Watergate scandal, the scandal that led to the resignation of the president Nixon (Dr. Gholanhossein).
In order to successfully launder money three processes are needed: placement, layering, and integration. In the first state, placement, the illegal proceeding are disengaged from direct association with the crime or criminal. In the second stage, layering, the money is used in some legal financial transaction in order to “camouflage” the cash. In the third stage, integration, the apparently legal money is available to the money launder (Kelly, Maghan and Joseph). For better understanding, the fig 1 gives a real life example on how money laundering is done.
Fig. 1 “A Typical Money Laundering Scheme”, a scheme by Paul Renner, What is Money Laundering? The Three Stages in Money Laundering...http://paulrenner.com/C6-Intelligence/paul-renner-c6-kycmap-what-is-money-laundering.html
To complete every stage, money launderers use different techniques. To complete the first stage, placement, money launderers could use some techniques like bulk cash smuggling, financial institution complicity, and blending of funds. The first technique cash smuggling is one of the oldest and