Money Laundering – What is it really?

Many public figures have faced and will face money laundering charges. Many still may not understand what the crime of money laundering is all about. Money laundering is a process whereby the proceeds of crime are transformed into apparently legitimate money or other assets.

According to the United States Treasury Department, money laundering is the process of making illegally-gained proceeds appear legal. Typically, it involves three steps which are placement, layering, and integration. First, the illegitimate funds are furtively introduced into the legitimate financial system. Then, the money is moved around to create confusion, sometimes by wiring or transferring through numerous accounts. Finally, it is integrated into the financial system through additional transactions until the illegal funds appears legal.

Law enforcement agencies of many jurisdictions have set up sophisticated systems to detect suspicious transactions or activities. Many agencies have set up international cooperative arrangements to assist each other in these endeavours.

In Malaysia, the Anti-Money Laundering and Anti-Terrorism financing act 2001 is an Act to provide for the offence of money laundering, the measures to be taken for the prevention of money laundering and terrorism financing offences. The act is to provide for the forfeiture of terrorist property and property involved in, or derived from, money laundering and terrorism financing offences, and for matters incidental thereto and connected therewith.

Former Prime Minister of Malaysia Datuk Seri Najib Tun Razak faces three charges of receiving RM42 million in illegal proceeds linked to SRC International Sdn Bhd. The former Prime Minister is charged under Section 4 (1) (b) of the Anti-Money Laundering and Anti-Terrorism Financing and Proceeds of Unlawful Activities Act. He faces a maximum 15 years’ jail and no less than five times the amount of proceeds involved, or a RM5 million fine, whichever is higher, if convicted.

 

 

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