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Money laundering
This document discusses money laundering, including how it has become a global threat due to factors like globalization and technology. It describes the processes involved in money laundering as placement, layering, and integration. International responses to money laundering are also summarized, such as the Vienna and Strasbourg conventions, as well as the Financial Action Task Force. Finally, the document argues that money laundering proceeds should be used to benefit society through education, poverty alleviation, and other means in the interests of social justice.
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Money laundering
- 1. Money Laundering Presented ByAbsar Aftab Absar
- 2. Approach What is Money Laundering? Howit has become a Global menace? Connection of Social Justice with money laundering.
- 3. What is MoneyLaundering Criminal Activity Drugs/Arms trafficking, terrorism, extortion Illegally obtained money Money appears to originate from legitimate source Conversion
- 4. Concept of MoneyLaundering Money laundering generally refers to ‘washing’ of the proceeds or profits generated from: Drug trafficking Arms, antique, gold smuggling Prostitution rings Financial frauds Corruption, or Illegal sale of wild life products and other specified predicate offences
- 5. Processes involved inMoney Laundering PLACEMENT LAYERING INTEGRATION
- 6. Placement Immersion or Soaking Thephysical disposal of bulk cash proceeds derived from illegal activity
- 8. Layering “Soaping / Scrubbing” Theseparation of illicit proceeds from their source by creating complex layers of financial transactions These disguise the audit trail & provide anonymity
- 9. Integration “Repatriation / SpinDry” Re-injecting laundered proceeds into economy so that they re-enter financial system as normal business funds Provides an apparently legitimate explanation to criminally derived wealth
- 11. Why money launderinghas become a global threat Globalization of the markets. Growth in the International trade. Surge in the internationalization of organized crime. Quick transfer through financial wires and computer.
- 12. International Response Vienna Convention1988 •Demanded signatories to enact domestic laws criminalizing laundering of money derived from drug trafficking. •Unfortunately it was not implemented globally. Strasbourg Convention of 1990 •Council of Europe adopted it and by 1999 27 of 41 members ratified. •Demanded the same from the signatories except to criminalize laundering of money derived from any serious crime.
- 13. Cont.… Financial Action TaskForce Recommendations (FATF) •Established by Group of seven industrialized countries (G-7) in 1989. •Issued recommendations in 1990 called forty recommendations to combat money laundering. •Updated in 1996 and encouraged full implementation of Vienna and Strasbourg convention. •It prepares annual Money Laundering report.
- 14. Social Justice andMoney Laundering Laws as mentioned above not effective enough to tackle the menace off Money Laundering. •We should have some laws by virtue of which the proceeds of Money Laundering can be effectively used for the benefit of the society- •The money generated through money laundering can be used to impart education among the deprived ones. •Can be used for the eradication of poverty by providing dole to the needy ones. •Can be used to pay Country’s debt. •Many other purposes for the society at large.
- 15. Conclusion Money Laundering isgrowing at a at an alarming rate. The proper implementation of the Vienna as well as Strasbourg Convention should be there. The proceeds from the money laundering should be consumed for the benefit of the society to meet the ends of Social Justice.