• Home
  • Blog
  • News
  • Prevention
  • About Us
  • Archive
  • Contact Us
FraudsWatch
  • Financial Scams
    • Investment Scams
      • Ponzi Schemes
      • Pyramid Schemes
      • Pump And Dump Schemes
      • High-Yield Investment Programs (HYIPs)
      • Binary Options Scams
      • Forex Scams
      • Cryptocurrency Scams
      • Gold Investment Scams
    • Loan and Credit Scams
      • Advance Fee Loan Scams
      • Credit Card Scams
      • Debt Elimination Scams
      • Credit Repair Scams
      • Payday Loan Scams
      • Student Loan Scams
    • Banking and Payment Scams
      • Phishing Scams
      • Wire Transfer Scams
      • Fake Check Scams
      • Overpayment Scams
      • Account Takeover Fraud
      • Cash App Scams
  • Internet Scams
    • Online Shopping Scams
      • Auction and Retail Scams
      • Counterfeit Goods
      • Online Ticket Scams
      • Drop Shipping Scams
      • Free Trial Scams
    • Social And Dating Scams
      • Romance Scams
      • Military Scams
      • Fake Influencer Scams
      • Social Media Phishing
      • Online Extortion Scams
      • Catfishing Scams
    • Online Advertising and Business Scams
      • Fake Job Scams
      • Affiliate Marketing Scams
      • Fake Business Opportunities
      • Online Business Scams
      • Work-From-Home Scams
    • Email and Phishing Scams
      • Nigerian Prince Scams (419 Scams)
      • Lottery Scams
      • Inheritance Scam
      • Tech Support Scams
      • Ransomware Scams
  • Identity Theft
    • Personal Information Theft
      • Account Takeover Fraud
      • Tax Identity Theft
      • Medical Identity Theft
      • Child Identity Theft
      • Synthetic Identity Theft
    • Business Identity Theft
      • Business Email Compromise (BEC)
      • Corporate Identity Theft
      • Vendor Impersonation Scams
      • Business Loan Fraud
  • Property Scams
    • Rental Scams
      • Fake Rental Listings
      • Overpayment Scams
      • Rental Deposit Scams
    • Homeownership Scams
      • Mortgage Relief Scams
      • Home Improvement Scams
      • Deed Theft Scams
      • Land Scams
  • Travel Scams
    • Timeshare Scams
    • Travel Club Scams
    • Vacation Rental Scams
    • Discount Travel Scams
    • Fake Travel Agency Scams
  • More..
    • Report Fraud
      • Report Scammers
      • Scammer Email Addresses
        • AOL Aim Live ATT
        • Email Man-Male Scammers
        • Gmail.com
        • Hotmail.com
        • Russian Email Scam
        • Yahoo.com
        • Email Scam List
        • Email Scams Examples
      • List of Fraud And Scam
    • Fraud Prevention
    • Health and Wellness Scams
      • Miracle Cure Scams
      • Weight Loss Scams
      • Fake Online Pharmacies
      • Health Insurance Scams
      • Medical Equipment Scams
    • Charity And Fundraising Fraud
      • Fake Charities
      • Disaster Relief Scams
      • Crowdfunding Scams
      • Social Media Fundraising Scams
    • Elderly and Vulnerable Targets
      • Grandparent Scams
      • Medicare Scams
      • Funeral and Cemetery Scams
      • Financial Exploitation of the Elderly
    • Legal Scams
      • Immigration Scams
      • Tax Evasion Scams
      • Money Laundering Scams
      • Insider Trading Scams
  • Log In
Home » Fraud » What Is Money Laundering

What Is Money Laundering

April 29, 2016 by FraudsWatch
Money Laundering

Since the beginning of time, there have been bad guys! They have profited through illegal means. The bad guys figured out a way to make the “dirty money” look clean. What is money laundering? It’s the process of making money made through illegal means look legitimate.

So how do the bad guys do it? In my line of work, one always worries about spilling the beans to the bad guys. Trust me, there is nothing in this article that the bad guys don’t already know. So back to the question, how do the bad guys launder money? Why with smurfs of course! Not the little blue creatures we know from TV and the movies. Well, not exactly anyway.

For those who are familiar with the fictional characters, they are about 3 inches tall, and were always pitted against an evil wizard. Somehow the little guys always banded together to beat the big foe. This concept has been applied to laundering money. In this context, smurfing money is the process of splitting large transactions into many small transactions to avoid detection. Smurfing money is also known as structuring.

The goal of laundering is to make bad money look good. Think of it as a classic shell game. The money goes in under one of the shells, and then gets shuffled around. The criminal hopes they can get the money out from under the shells without the banks being able to follow along.

Just like the shell game, laundering money is a three stage process. First the criminal puts the money on the table. Because of the AML regulations, this stage often involves smurfing money. Transactions above $10,000 are reported to the government, so the money launder must break this down into many smaller transactions to avoid detection in the placement stage. After the dirty money is placed, the goal of the money launderer is to hide the source of funds.

In the shell game this is the stage where the shells are moved around to confuse the mark. In the same way, the money launder conducts a series of transactions called layering. The hope is that these transactions will confuse the bank so that the original source of transactions is lost. The last stage of the shell game is letting the mark try to find the original object.

In money laundering the last stage is integration. The money launderer’s goal in this stage is to extract the money from the financial system as legitimate funds. In many cases, integration involves moving the funds to banks in foreign countries, or using shell companies to benefit from the proceeds. Once the money has been integrated, it is considered clean.

Of course, at every step of the way, the banks are using every means at their disposal to fight money launderers. Banks are actually on the front lines of the war on terror and the war on drugs. By making it more difficult for the bad guys to use their illegal gains banks play an important role.

It should be clear that those adorable blue characters aren’t criminals. Their names were adopted because of their small size and their ability to band together. This represents structuring a technique in the first stage of money laundering. Banks combat money laundering at all stages of the process, but it is most critical to limit the criminal’s ability at the placement stage. By making it more difficult to make “dirty money” look clean, we make it more difficult for criminals to benefit from their crimes.

One response to “What Is Money Laundering”

  1. Gabriella Giachin Ricca says:
    August 6, 2016 at 7:26 am

    Good morning,I have been scammed by an alias called Major MICHAEL COOK supposed to be deployed in Afghanistan. He ask me money for a private Sat phone line refundable in 7 14 days.I fall in his trap and I played 650$.Then he called me several times,few days later ask me money for a leave permission.I became suspicious and start a research so I found out warning from the USA army.I reported the facts to the Italian police but they didn’t even consideration what I was saying.In Italy this kind of fraud is not advertise enough.the alias e-mail is michealcook2311@Gmail.we chatted on hangout too.I met him on tinder website.Thank you.best regards

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Categories

  • AOL Aim Live ATT
  • Celebrities Scammed
  • Credit Card
  • Credit Scam
  • Email Man-Male Scammers
  • Email Scam List
  • Email Scams Examples
  • Financial Recovery Verticals
  • Fraud
  • Fraud News From World
  • Fraud Prevention
  • Gmail.com
  • Hotmail.com
  • Insurance
  • Jobsearch Scams
  • Loans
  • Military Scammer
  • Mortgage
  • Nigerian 419
  • Report Fraud
  • Romance Scammer
  • Russian Email Scam
  • Scammer
  • Scams Ways
  • Shopping & Saving Money
  • Spam
  • White-Collar Crime
  • Yahoo.com

Tags

Bank Fraud Consumer Fraud Credit Card Fraud Cyber Crime Cybercrime Cybersecurity Dating Scammer Elder Fraud Elder Justice Email Email Scam Email Scam Example Email Scam Examples Email Scams False Claims Act FBI Financial Fraud Fraud Health Care Fraud Healthcare Fraud Identity Theft Insurance Insurance Fraud Investment Fraud Loan Fraud Loan Scam Mail Fraud Medicare Fraud Military Scammer Military Scammers Money Laundering Mortgage Mortgage Fraud PayPal Phishing Public Corruption Romance Scammer Romance Scammers Scam Scammer Scammers scams Tax Evasion Tax Fraud wire fraud

Recent Posts

  • Lost Money in an Investment Scam? A 2025 Guide to Financial Recovery July 27, 2025
  • Michigan Home Health Agency Pays $334K to Settle Whistleblower Fraud Allegations: A Deep Dive into a Broken System July 13, 2025
  • Survey Note: Detailed Analysis of Murex Management’s Financial Fraud Case July 13, 2025
  • The Unseen Battlefield: Your Definitive 2025 Guide to Advanced Scam Detection July 9, 2025
  • Bulletproof Betrayal: Inside the $5.2 Million ShotStop Fraud That Sold Counterfeit Body Armor to America’s Law Enforcement July 8, 2025
  • Home
  • Blog
  • About Us
  • Contact Us
  • Disclaimer
  • PRIVACY POLICY
  • TERMS AND CONDITIONS
  • Credit Card
  • Credit Scam
  • Insurance
  • Loans
  • Mortgage
  • Fraud Prevention
  • Celebrities Scammed
  • Jobsearch Scams
  • Military Scammer
  • Nigerian 419
  • Romance Scammer
  • Scammer
  • Home
  • Blog
  • About Us
  • Contact Us
  • Disclaimer
  • PRIVACY POLICY
  • TERMS AND CONDITIONS

© 2025 FraudsWatch. All Rights Reserved.

Back to Top