Money Laundering Examples

Money laundering is the criminal enterprise where financial transactions are used to conceal the identity, source and/or destination of money that has been made illegally. Many criminal organizations such as drug cartels use money laundering to hide their drug money from the government and spread the money out to other locations to avoid leaving a trail. The laws have changed recently to expand on the criminal activity of money laundering to involve any financial transaction that creates an asset or a value due to money earned illegally. This measure is to cover anyone and everyone who enters into money laundering so to dissuade people who venture into criminal activity. There are many examples of money laundering that people and criminal organizations like the Mafia engage in to hide their illegal tender from the watchful eye of the government.

  1. One particular way to launder money is when small business such as a store takes in large amounts of cash but deposits it in modest portions so to not draw suspicions as opposed to varying greatly which may draw the eye of the government.  This transaction uses this stipulation to slip in the dirty money through the clean money as most money laundering schemes tend to do. Cashiers in banks have to typically report substantial money transactions of $10,000 or more called suspicious activity reports in order for the government to intervene.
  2. Another method of money laundering involves shell businesses that provide services to the public instead of delivering good such as haircuts.  Money laundering uses these services to hide the dirty money into services where it is difficult to track customers who tip or no financial records of their clientele.
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