ACCA Applied Knowledge · Business and Technology · Regulation and financial crime
Having placed illicit funds in a bank, a launderer wires them through several shell companies in different countries and makes repeated transfers between accounts to obscure their origin. Which stage is this?
This is layering. Layering is the second stage, where launderers move funds through many transactions, accounts and shell companies in different jurisdictions to distance the money from its criminal source and make the audit trail hard to follow.
- APlacement
- BLayeringCorrect
- CIntegration
- DPredicate offending
Explanation
Layering separates the proceeds from their source through a series of complex transactions, such as multiple transfers and shell companies. Placement has already happened since the funds are in the bank. Integration is when the funds re-enter the economy as apparently legitimate wealth.
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