ANTI-MONEY LAUNDERING & KYC AND COMBATING FINANCING OF TERRORISM
1.1. What is Money Laundering
Money laundering is a process whereby large amount of money obtained by criminals through illegal means such as drug trafficking, extortion, terrorism, illegal arm sales, smuggling, gambling etc. are channelized through banking channels to make it appear as legally obtained money.
Definitions of Money laundering
The following definitions of Money laundering will make understanding the term better
“Engaging directly or indirectly in a transaction that involves property, that is of crime or derived from proceeds of crime or knowingly receiving, possessing, concealing, disguising. transpiring, converting, disposing off within the
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• Deprives the government of the revenue by way of taxes
• Weakens the financial stability of a country
1.4. Scale of Money laundering
No published figures are available on the quantum of money laundered worldwide. However a study conducted by The United Nations Office of Drugs and Crime (UNODC) estimates that in the year 2009 the criminal proceeds amounted to 3.6 percent of global GDP of which 2.70 percent amounting to USD 1.60 trillion was laundered.
1.5. Some important traits of professional money launderers
Following are some important traits of professional money launderers o He / She/They are sophisticated, technically savvy and financially astute o Actively assess emerging value transfer methods o Are finance and IT savvy o Have complex and well organised structures in place o Are capable of moving considerable value in short periods of time o Can guarantee value transfer as instructed o Are capable of defeating known AML
The Mexican drug cartels have been smuggling drugs across the boarder of Mexico to the United States of America for decades. The Mexican drug cartels are a drug smuggling criminal organization. In other words they run a narcotic drug business. * In my research, I will be discussing about the money being laundered by the Mexican drug cartels from the U.S. to Mexico. The cartels need to launder their money in order to be able to take their drug money back to their country of Mexico.
1. Make specific and general discussion comments that define and differentiate between the inchoate crimes of "attempt, solicitation, and conspiracy." Give examples of each of these criminal law key term words.
The money laundering process happens in three stages; the illegal activity that bring in the money places it in the criminals hands in this case Khan, Alexander and Babb. Then, the launderer, (Babb) passes the money through a complex scheme of transactions, in this case Eyak Technology, to obscure who initially received the money from the criminal enterprise. Lastly, the scheme returns the money to the launderer in an obscure and indirect way. Kerry Khan was also responsible for engaging in unlawful kickbacks. A kickback occurs when a certain percentage of income is given to an individual as payment for having made the income possible in the first place. Under federal law kickbacks that involve government officials or funds that are provided by the government are illegal. Some kickbacks fall under the bribery statute 18 USC § 201, such as those between a contractor and a government official. Other kickbacks are prosecuted under federal statute 41 USC § 51–58 which is for private contractors working under a federal contract, this statute stems from what is known as the Anti-Kickback Act of 1986 (DOJ,
Money is the main source of power in the world, but in ways it can be viewed as good or bad depending on the situation. It has a negative connotation when mentioned by the word “acts”. “ Acts” means to perform a fictional role. Which shows that most things involving money are fake. Though humans associate being fake with being morally wrong,but its somehow acceptable if there is a greater power involved. Another definition for acts is to take action;do something. In this case to take an action can be either good or bad. There are many ways to come across money, but nobody cares if it is good or bad because it deals with a greater power.
Most people consider this crime to consist of CEO’s manipulating their way to making a large fortune. This of course, is true most of the time in high-profile cases. For example, in late 2001 Enron Corporation executives confessed to overstating the company’s earnings. This lead to artificially inflating what the company was worth and deceived the investors. It took some time to unravel all the fraud put behind this devious act but shows how sophisticated white-collar crime can be. Although it’s usually associated with upper management of corporations, people from all different levels and occupations can perform this crime ("How White-collar Crime Works").
RICO prohibits using money generated by a pattern of racketeering to gain or maintain control over an enterprise, to invest in an enterprise, or to participate in the conduct or affairs of an enterprise (Whitman & Gergacz, 430). Section 1962 of the RICO Act defines a racketeering activity as any act or threat involving murder, kidnapping, gambling, arson, embezzlement, robbery, bribery, extortion, dealing in obscene matter, or dealing in a controlled substance, which is chargeable under State law and punishable by imprisonment for more than one year (www.4law.cornell.edu/uscode/18/1962.text.num). A pattern of racketeering activity may be defined as the commitment of two or more of these violations of the RICO act within a period of ten years. An enterprise can include any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals asso...
Intention to commit an offense (Dave entering boat house without permission to steal Sam’s boat).
threat or use of force or other forms of coercion, of abduction, of fraud, of deception, of
...benefit economically from their activities on these markets. Countries with offshore centers that specialize in money-laundering reap significant benefits. Unlike the negative effects of the Mafia and organized crime, the positive effects are direct and quickly noticeable (Van Dijk 56). Even though it may seem like the revenue from all of the illegal activities helps the economy, it actually does not. There are profits but it does all lead back to negativity: corruption, lesser rule of law, risk of business, etc. The economy is actually slowed down and weakened rather than strengthened (Van Dijk 52).
Crime is some action/omission that causes harm in a situation that the person/group responsible ‘ought’ to be held accountable and punished irrespective of what the law book of state say.
B. Background: The Sinaloa Cartel has become one of the most predominate suppliers of illegal narcotics in the entire world. The United States alone has provided the cartel with a huge amount of business The Human Rights Watch 2013 report of drug cartel income, "Mexican drug cartels take in between $19 and $29 billion annually from U.S.
estimated 7 billion dollars earned in shadow market. This money is used for drugs, gangs, mafia,
Trafficking in human beings is now the fastest-growing business of organized crime. Men, women and children are trafficked within their own countries and across international borders. More than one person is smuggled across a border every minute which is the equivalent to ten jumbo jets every single day. And the trade earns twice as much as the Coca Cola brand. (STOP THE TRAFFIK 2014)
Manipulation, falsification (forgery), or alteration of accounting records or documents from which the financial statements are prepared.
a legitimate act to carry out the law. An example is a police officer acting on an observed robbery.