USA Africa Dialogue Series - 3 STAGES OF MONEY LAUNDERING

 

 

 

3 STAGES OF MONEY LAUNDERING

 

 

 

 

 

1.     PLACEMENT / IMMERSION (1^st Stage)

The physical disposal of cash derived from any illegal or criminal activity, by processing such unlawful proceeds through Financial institutions.

 

EXAMPLES:

•         Deposit into Bank Account

•         Booking of an Investment

•         The use of cash to buy a Bank Draft payable into an account.

 

2.     LAYERING / DILUTION / AGITATION / HEAVY SOAPING (2^nd Stage)

This is the creation of a complex web of financial transactions aimed at concealing the audit trail, and separating money from its criminal origin.

 

EXAMPLES:

•          Purchase of shares in different names.

•          Obtaining loans

•          Transfer of funds to a variety of accounts, to different people.

 

3.     INTEGRATION / DRY SPIN STAGE (3^rd Stage)

This is the legitimization of illicit proceeds by investing them in the formal economy in such a manner that they re-enter the financial system and appear as normal funds.

 

EXAMPLES:

•          Purchase of Petrol Stations

•          Purchase of motor vehicles e.t.c

 

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