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D VEKATA KIRAN
What is Money Laundering? Ô ³The process used to disguise the source of money or assets derived from criminal activity´ Ô Include: Ô Drug trafficking Ô Extortion Ô Corruption Ô Fraud .
Why do they laundry? Criminals want to: Ô Avoid prosecution Ô Increase profits Ô Avoid seizure of accumulated wealth Ô Appear legitimate Ô Tax evasion They are trying to conceal the origin of the cash .
Common money laundering techniques Ô Bank complicity Ô Asset purchases with bulk cash Ô Postal money orders Ô Credit cards Ô Gambling in casinos Ô Refining .
which set out the measures national governments should take to implement effective anti-money laundering programmes. Ô Ô . IMF for example. stated in 1996 that the aggregate size of money laundering in the world could be somewhere between two and five percent of the world¶s gross domestic product. One of the first tasks of the FATF was to develop Recommendations. the Financial Action Task Force on money laundering (FATF) was established by the G-7 Summit in Paris in 1989 to develop a co-ordinated international response. 40 in all.Legal frame work so as to curb Money Laundering: Ô In response to mounting concern over money laundering.
.Money laundering affecting Business Ô If funds from criminal activity can be easily processed through a particular institution ± either because its employees or directors have been bribed or because the institution turns a blind eye to the criminal nature of such funds ± the institution could be drawn into active complicity with criminals and become part of the criminal network itself. as well as ordinary customers. Ô Evidence of such complicity will have a damaging effect on the attitudes of other financial intermediaries and of regulatory authorities.
Money laundering and International Law: Ô UN Convention against illicit trafficking of narcotics and psychotropic substances passed in 1988 in Vienna Ô Convention on laundering. in Palermo. 2000. Ô UN Convention against transnational organized crime passed on December 12-15. Ô Directive for prevention of use of financial system for money laundering in 1991. Ô These international acts establish a legal basis for governing incriminated behavior related to money laundering in national criminal legislation and regulation of criminal sanctions. search and confiscation of criminally gained profit dated November 8. . Strasbourg. 1990.
availability and movement of derived ownership rights or property knowing that the property is the result of a committed crime. Ô Assistance to any person involved in committing of such a crime in order to avoid legal consequences of these activities. Ô Collusion in order to commit. instigate. possession or use of goods or things or values knowing at the time of their receipt that they are the result of illicit trafficking of narcotics. . assist. source. Ô Gaining. attempt. Ô Hiding or concealing the true nature. facilitate or advise to commit crime of trafficking of narcotics including money laundering. location.Activities responsible for money laundering: Ô Conversion or transfer of property knowing that the property is the result of a committed crime in order to conceal the illicit origin of the property.
try to commit and assist. movement of rights or property in relation to the property knowing that the property is the result of a committed crime. Concealing or false representation of legal nature. possession or use of property knowing at the time of receipt that it is the result of criminal activities. especially women and children and the Protocol against smuggling of migrants by land. use. repression and punishment of people trafficking.. location. Repression of money laundering was also included in the UN Convention against transnational organized crime with two additional protocols: the Protocol about the problems of undertaking efficient measures for prevention and for prevention. instigate or facilitate and advise any crime. Participation. source. collusion or conspiracy in order to commit. sea or air. Gaining. Ô Ô Ô Ô Ô .Article 6 of the EU Convention 1990: Ô It defines the concept and characteristics of the crime of money laundering which consists of intentional undertaking of one or more of the following activities: Conversion or transfer of property knowing that the property is the result of a committed crime in order to conceal or present falsely the origin of property or assisting an individual involved in committing the mentioned crime in order to avoid legal consequences for their acts.
International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001). Ô Ô Ô Ô . Section 206 of the Federal Deposit Insurance Corporation Improvement Act of 1991 The Annunzio-Wylie Anti-Money Laundering Act (Title XV of the Housing and Community Development Act of 1992). The Money Laundering Suppression Act of 1994 (Title IV of the Riegle-Neal Community Development and Regulatory Improvement Act of 1994) The Money Laundering and Financial Crimes Strategy Act of 1998 The USA PATRIOT Act (Title III. The Money Laundering Control Act of 1986 The Anti-Drug Abuse Act of 1988.Anti-Money Laundering (AML): Ô Ô Ô The Bank Secrecy Act (Currency and Foreign Transactions Reporting Act of 1970). Section 2532 of the Crime Control Act of 1990.
Ô It may be suggested that the substantive mix of AML rules even if their historic evolution is different in each of the countries examined reflects tacit. the stability of financial markets has to be secured from the damage that could result through systemic misuse.Conclusion Ô In order to control the abuse of financial centers by transnational criminal operators. the FSF and the FATF amongst others. preventive and punitive measures are clearly necessary. are continually developing details for a harmonized approach aimed at preventing ³money laundering´. Ô This latter aim has meant that international bodies such as the Basel Committee. . Ô Moreover. but at the same time.