Does It Mean When Someone Launders Money?

Money laundering is the illegal process of making large amounts of money generated by a criminal activity, such as drug trafficking or terrorist funding

, appear to have come from a legitimate source. The money from the criminal activity is considered dirty, and the process "launders" it to make it look clean.

How do you launder money?

Money laundering involves three basic steps to disguise the source of illegally earned money and make it usable: placement, in which the money is introduced into the financial system, usually by breaking it into many different deposits and investments; layering, in which the money is shuffled around to create distance ...

Why do people launder money?

When they make money from crime, criminals use it for one of three purposes - to invest in another crime, to hide to use later or to spend now. ... Tax evaders launder money so that they can lie about where money and assets came from in order to evade tax.