moneylaundering 120115060133-phpapp02
TRANSCRIPT
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Good afternoon to one &all
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MONEY LAUNDERING
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DEFINITION OF MONEY LAUNDERING
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MONEY LAUNDERING IS THE
PROCESS OF DISGUISING ILLEGAL SOURCES OF MONEY SO THAT IT LOOKS
LIKE IT CAME FROM LEGAL SOURCES
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meaning
•The word “laundry” literally means “cleaning”•Metaphorically, money laundering refers to “cleaning on money”
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Money laundering
“Any financial transaction which generates an asset or a value as the result of an illegal act.”
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Money laundering methods/stages:
Drug Trafficking ExtortionCorruptionFraudCurrency smugglingBank complexityTax evassionTerrorismTransactional organised crimeHuman trafficking
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PROCESS OF MONEY LAUNDERING
Placement Layering Integration
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PlacementGetting Currency into the
financial system so as to convert illicit funds from cash straight into a financial instrument or bank account
LayeringThe movement of funds from institution to institution to hide the source and ownership of the funds, obscure the audit trail and sever the link with the original crime
IntegrationThe reinvestment of
those funds in an ostensibly legitimate business so that no suspicion of its origins remains and to give the appearance of legitimizing the proceeds
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PROCESS OF MONEY LAUNDERING
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FOR EXAMPLE
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The black money is also earned by gifts , hawala transactions and illegal foreign exchange deals.
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How the HAWALA System works?
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Hawala
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OBJECTIVES OF MONEY LAUNDERING Hide: to reflect the fact that cash is often
introduced to the economy via commercial concerns which may knowingly or not knowingly be part of the laundering scheme, and it is these which ultimately p y prove to be the interface between the criminal and the financial sector
Move: clearly explains that the money launderer uses transfers, sales and purchase of assets, and changes the shape and size of the lump of money so as to obfuscate the trail between money and crime or money and criminal.
Invest: the criminal spends the money: he/she may invest it in assets, or in his/her lifestyles
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Criminals in money laundering
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Drug Dealers:
Drug dealers usually deal with large amounts of cash, making it difficult for authorities to make a paper trail. Large amounts of cash raise red flags.
CRIMINALS OF MONEY LAUNDERING
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Mobsters/Gang members: Like drug dealers, these individuals (in a group form)perform manycash transactions while maintaining safe networksoverseas.
CRIMINALS OF MONEY LAUNDERING
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Bad Politicians: With greater access to money and lobbyist networking, the act of money laundering can seem to be one of the best way to protect one's assets.
Bad Public Officials: Mainly, anyone in a position of authority whose actions normally go unquestioned will take advantage of an opportunity like this
Embezzlers: Cases have proven that people who have taken money from an employer or their own place of business will normally partake in activities to hide these newly acquired assets.
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Terrorists: Terrorists are big in money laundering. Terrorist activities must be financed; otherwise explosives and other weaponry would not be an obtainable asset.
CRIMINALS OF MONEY LAUNDERING
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CAUSES OF MONEY LAUNDERING
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CAUSES OF MONEY LAUNDERING
Absence of legislation
Evasion of tax Increase in profits To make black
money appear white money
Limited risks of exposure
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Absence of legislation against money laundering:
Absence of legislation against money laundering give a free hand to criminals. sometimes governments itself is involved they do this to win political rivals, to please their allies and to strengthen their rule. Also CBR (Central Board of Revenue) has never bothered to unearth laundered money, rather always joined hands with the and money launderers.
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EVASION OF TAX:
Tax evaders launder money so that they can lie about where money and assets came from in order to evade tax. And sometimes they simply operate outside that part of the economy where records are kept.
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Increase profits:When people have incentive for more profit inany particular area, such as in production and
tradingof drugs, arms, and across the borders trade,
theystart taking risk to earn higher profits.
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TO APPEAR BLACK MONEY LEGITIMATE:
In money laundering, black money usually becomes legitimate after a series of process. And less risk is involved of being caught. This doesn’t happen in other economic crimes. So in order to appear their money more legitimate they go for money laundering.
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LIMITED RISKS:
The availability of multiple opportunities for personal enrichment without the risk of being exposed is another cause of money laundering. Such economic environments are much more conducive to make black money.
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EFFECTS OF MONEY LAUNDERING ON ECONOMY
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Effects:ML
Money Laundering Undermines Domestic CapitalFormation
Money Laundering Depresses Growth
Money Laundering Diverts Capital Away fromDevelopment
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The perpetrators: money laundering by criminal
sector
Money Laundering by Activity
Terroristgroups
1% Drugs26%
OtherOrganized
Crime23%
Smuggling29%
Embezzle-ment/WhiteCollarCrime21%
Source: Celent
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Source: Celent
The victims: money laundering by industry sector
Money Laundering by Industry Sector
InsuranceFirms9%
CreditCards
5%
MoneyServices
4%Brokerage
&Investment
Firms27%
Banks55%
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ANTI MONEY LAUNDERING
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AML-Meaning
Stoppage of illegal money generation
Laws,procedures,policies,etc. for money laundering activities
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Tighter AML regulation in the US and Europe is pushing money laundering activity into Asia Pacific…
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THE STATE OF AML…
Low
High
Industry AwarenessLow
Pro
gre
ss(I
mp
lem
enta
tio
n o
f sy
stem
s)
High
Australia
Hong Kong
JapanIndia
ChinaTaiwan
Malaysia
Singapore
South Korea
ThailandIndonesia
Philippines
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CONCLUSION:-
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Black money is harming our national economy
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IN ORDER TO FULFILL THE NEEDS , THE PERSON IS TRYING TO EARN THE MORE MONEY BY ILLEGAL ACTIVITIES
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Slow Progress
of Country
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Unequal Distribution of
Money
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The world thinksIndia = Black money
Lets change the view,Lets make a move.
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The only way to return black money is changing the govt. and youth who has passion towards the development of India will enter into politics.
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“ONLY HONEST PERSONS CAN SAVE OUR NATION”
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PPT SUBMITTED BY
Bukke uday naikBhagavan reddy
RevathiUnder the guidance of
Dr.M.ravichand,Mr.P.venkateswarulu,Assistant professor,
Department of GEBH.
PPT SUBMITTED BY
J.Gowthamilokesh