Download Money Laundering - Pennsylvania State University

Money Laundering
Physical & Cyber Crime
Anti-Terrorism Focus
Other Impacts
Uniting & Strengthening
America (USA Patriot) Act
 Controversial
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Provisions:
Expanded Federal investigation powers
Detention of aliens, designation of terrorist
orgs.
Online surveillance enhancements
Secret searches, Interagency info sharing
Monitor confidential Atty-Client
communications
 Extends
Existing Money Laundering
Restrictions
What IS Money Laundering?
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Various practices create illusion of legitimate
transactions, disguise origin & movement of $
 Law Enforcement motto: “Follow the Money!”
 Modern Term originated in 20s-30s gangster era
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Coin cash flow from “numbers” racket cleansed
through mob-operated coin-op laundries
Existed for nearly 4000 yrs
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Hide earnings from despotic govt confiscation &
taxes
Essential to terrorism, illegal drug trade, organized
crime, smuggling
Money Laundering Methods &
Tools
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Well-known practices but detection is costly
 Transactions with minimal recordkeeping
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Payments under $10K to avoid Currency Trans. Rpts
Cash used whenever possible
Minimize use of checks, wire transfers, credit cards
“Legitimate Fronts” apparently respectable
businesses
See http://www.moneylaundering.com
Anti-Money Laundering Laws
Federal Statute with
Money Laundering Provisions
Anti-Money Laundering
Purposes and Methods
Bank Secrecy Act of 1970 (BSA)
Currency Transaction Report ("paper
trail" for transactions over $10,000);
civil & criminal penalties
Creates three new federal money
laundering crimes: (1) assistance in
laundering, (2) engaging in $10,000
transactions involving property from
criminal activity & (3) structuring
transactions to avoid BSA disclosures
of Currency Transaction Reports.
Increased civil & criminal sanctions.
Forfeiture of property involved in
violating BSA or other AntiLaundering statute. Requires
recordkeeping of large cash
purchases of monetary instruments
(bank drafts).
Money Laundering Control Act of
1986
Anti-Drug Abuse Act of 1988
Anti-Money Laundering Laws
Federal Statute with
Anti-Money Laundering
Money Laundering Provisions Purposes and Methods
Crime Control Act of 1990, §2532 Federal banking regulators
authorized to negotiate with foreign
banking regulators for help in
certain criminal investigation
Federal Deposit Insurance
Federal banking regulators given
Corporation Improvement Act of
discretion to disclose information to
1991, §206
foreign banking regulators to
enforce anti-money laundering laws.
Housing and Community
Authorizes seizure, closing and/or
Development Act of 1992, Title XV revocation of charter of financial
[Annunzio-Wylie Anti-Money
institutions guilty of money
Laundering Act]
laundering or BSA offenses.
Specifies mitigation factors.
USA Patriot Act of 2001
Broadens definition, programs &
training required, tougher civil &
criminal penalties
USA Patriot Act’s Anti-Money
Laundering Provisions
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Broadens definition of financial institutions
regulated under money laundering laws
Requires anti-money laundering programs &
training
Regulates private and correspondent banking
FCPA now defines money laundering defined
as a form of bribery
Stiffens civil & criminal penalties for money
laundering