Money Laundering (ppt)
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ByAkash Jindal
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Money laundering can be described as the process by which a person conceals or disguises the identity or the origin of illegally obtained proceeds so that they appear to have originated from legitimate sources.
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The financing of terrorism can be described as the process by which a person tries to collect or provide funds with the intention that they should be used to carry out a terrorist act by a terrorist or a terrorist organization
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exploit economic and financial globalization
have serious social consequences provide drug traffickers grow organized criminal groups grow arms dealers and other criminals strike at the integrity of a country's
financial institutions. It distorts the operation of markets
transactions
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PlacementFlight CapitalLayeringTax HeavensIntegration
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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 crimeIntegratio
nThe 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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• Smurfing
• Shipping Money Abroad
• Placement through Banks
• Use of “Pass Through” or “Payable Through” Accounts
• Electronic Wire Transfers
• Insurance Products
• Investment Related Transactions
• NBFCs
• Tax Havens & Offshore Banks
• Bank Secrecy Law as a layering tool
• Corporations & Shell Companies as a layering tool
• Use of trusts
• Use of walking accounts
• Establishing self owned bank
• Use of intermediaries
• Use of haven bank credit cards
• Receiving as consulting or directors fee
• Arrangement of corporate loans
• Proceeds of gambling
• Real estate transactions
• Stock Purchase
• Use of business
• International importing and exporting
Placement Layering Integration
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Acceptance of flight capital by western countries
Laws and limitations of other countries
Jurisdictional conflicts and lack of international coordination
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Tax heavens as sanctuaries
Offshore corporations
Having to prove fraudulent transfer
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Bankings’ role in facilitation of the activity
Bank Secrecy
Volume and complexity of international transfers of funds
Internet based banking
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Shortfall of reporting requirements
Criminals influencing Government and Bank support
The widespread use and acceptance of trade mis-pricing
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Bulk e-mail
Vending Machines
Multi Level Marketing
Franchises
Inventions / Patents
Vanity Press Publishing
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Bank Fraud
Cheque Fraud
Fake Ads & Directories
Business Loans
Counterfeiting
Fraudulent Orders
Internet Services
Cramming
Supply Scams
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A money launder's objective in laundering ill is to : Get it out; cover it up; bring it back
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Contribution by different continents in ML(IMF report data, year 2008)
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Contribution by financial sector in ML (IMF report data, year 2008)
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'money transfer without money movement‘
was developed in India
Also known as chop, chit , flying money and underground bank
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• Inspector Raj
• Dual Responsibility
• Undue Delay in Processes
• Excessive intervention by Judiciary
• Very less time in law making
• Considering of problem rather than cause of the problem
• More interest before investigation but no interest in concluding the cases
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• Understand the need for creation / modification of laws to curb / eliminate opportunities for scams / frauds based on the study of global scenario
• Ensure appropriate powers to law enforcement agencies
• Provide facility for 2/3 levels of appeal before any one approach the judiciary
• Ensure time bound completion for the cases / designating case officer
• Announce very severe punishment for committing the crime
• Introduction of Compulsory Operations Audit on a periodical basis
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Utilize services of professionals such as
Chartered Accountants, Advocates &
Company Secretaries for conducting pre-
enquiries with regard to various indicators
available from news media
Be independent from every business not only
on paper but otherwise
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