10e Money Laundering Flashcards
What is money laundering?
‘Cleaning dirty money’.
Taking proceeds of crime and concealing them within a legit business so the funds appear as if they’ve come from the business not the crime.
What are the 3 phases of money laundering?
- Placement
- Layering
- Integration
What is placement?
When criminal property is placed within a legitimate business.
What is criminal property?
Money or property that results from criminal activity.
What is layering?
Property will be moved around the business to disguise its origin.
What is integration?
As a result of placement and layering, the criminal property now appears as legitimate business transactions.
What are the main money laundering legislation?
Proceeds of Crime Act 2002 which is supplimented by Money Laundering Regulations 2017.
What are the 3 main offences under money laundering?
- Laundering
- Failure to report
- Tipping off
What is a secondary offence of money laundering?
Inciting another to launder
What is failure to report?
Where people who have a duty to report money laundering to the NCA or their MLRO suspicion such as accountants, legal advisors or financial institutions but fail to do so.
How would someone discharge their responsibility to repeat money laundering suspicions?
Report to their MLRO or to NCA.
How can someone defend themselves against not making a report?
Prove they had reasonable excuse to not make a report, that money laundering was not suspected or their employer has not provided sufficient training.
What is tipping off?
Where disclosure has been made that a report has been made.
What is the maximum penalty for failure to report?
5 years and unlimited fine
Who does Money Laundering Regulations apply to?
Relevant people such as accountants, tax advisors and insolvency advisors as well as businesses such as estate agents or casinos.
