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Jouranl/article on a business

March 29, 2016 | Author: | Posted in business, mathematics and economics

TAKING THE LID OFF MONEY LAUNDERING IN THE UNITED STATES

Abstract

The definition of economic crime is presented , as a preponderand and progressive threat to all forms of businesses and industries in the United States . It is defined as the conversion or transfer of property derived from criminal activity , with the deliberate intention of hiding its illegal nature . The roots of money laundering are traced back from the time of Al Capone and Meyer Lansky . The stages of money laundering namely , placement , layering and integration are then discussed . This phenomenon has [banner_entry_middle]

serious repercussions on financial sector institutions and on the economy of the US as a whole

TAKING THE LID OFF MONEY LAUNDERING IN THE UNITED STATES

Economic Crime

Economic crime is a preponderant and progressive threat to all forms of businesses and industries existing in the United States in contemporary times . It has a straightforward relationship with insufficient economic policies , the lack of agility in privatization , and lack of strength on legal support to curb such activities . It is being effectively bred and emphasizes the shadow economy (Anderson , 1997 . It is through the entry of criminal money yielded through various illegal means that this phenomenon has developed into maturity . In fact , an economic crime research undertaken in 2005 asserts that at a minimum , there is a 25 proportion of American organizations who will be experiencing economic crimes , particularly money laundering in the next five years or so (Global Economic Crime Study , 2005 . This shows how confident these businesses are with their control systems , despite the fact that at twice as much as these had been victims of economic crime in the past

Definition of Money Laundering

It is critical to have a profound understanding of the process of money laundering . Denotatively speaking , money laundering is the ‘conversion or transfer of property , knowing that such property is derived from criminal activity , with the intention of hiding the illegal nature and the roots of the property from the pertinent authorities (Billy ‘s Money Laundering Information Website , 2006 . So any crime that generates significant profit may possibly create a need for money laundering Typically , money is laundered by physically or electronically moving it from one country to another and hiding its origin through creating complicated financial transactions

The concept of money laundering is such a wide one , covering a lot of areas — from the financial , social , up to the political arena . The metaphor of money laundering is ‘cleaning of money ‘ It involves the practice of engaging in specific financial transactions , done with the purpose of hiding the identity , source and /or destination of money . This now becomes a main operation of underground economy (Bartlett , 2002

Historical Background

It all started in the conviction of Al Capone for tax evasion in 1931 Following this , mobster Meyer Lansky transferred funds from the New Orleans slot machines to some accounts abroad . Right after the approval of Swiss Banking Act of 1934 , which gave birth to the practice of bank secrecy , Lansksy purchased a Swiss… [banner_entry_footer]

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