Money Laundering in Business Area

The money launderer changes the illicit proceeds from one form to another, often, in rapid succession. The trend is towards acquiring tangible assets (such as cars, boats, aircraft, luxury items, real estate, and precious metals) with the bulk cash originating directly from criminal activity. Often, but not necessarily linked with offshore centers, the mechanism of shell or front companies has been detected. These are entities that generally exist only on paper. These legal entities are usually conducted specifically in order to carry out a wide range of criminal businesses such as financial fraud, especially in the United Kingdom, and fraud against the European Union, especially in the Netherlands, Belgium and Italy. They do not participate in actual commerce and are run by straw men, as often found in Italy. Their purpose is quite exclusively criminal and they often face a «law enforcement risk» from investigations of the real nature of their existence. This is the reason why they are closed down almost as soon as they are formed and often the accountancy books are physically eliminated in order to conceal any trace that could help future or further investigations.

Money launderers are ever more oriented towards the use of non-banking financial institutions which are still not completely or properly regulated in some European Union member states. As they do not always come under the same obligation as the financial sector, because they are not allowed to undertake banking activities to earn interest, they are used especially at the placement stage for entering the cash into the financial market. There is evidence, especially in the Netherlands, Italy and Belgium, of criminal groups moving from major commercial banks to those called second line banks and often operating accounts in the name of offshore companies. These include a wide variety of bureaux de change, cheque cashing services, insurers, brokers, importers, exporters and other leading companies, gold and precious metal dealers, express delivery services and other money movers. Casinos or gambling houses are used at the placement stage. A special mention has to be made of insurance companies which are increasingly popular laundering mechanisms, as in Germany, especially in the premium insurance bond sector.

A detailed analysis of money laundering cases in the EU reveals a new category of professional money laundering specialists. These professionals have been emerging in Belgium, the Netherlands and Portugal as white collar criminals acting as financial advisers both as individuals or as organizations like firms. In the United Kingdom they emerged mainly as solicitors. In Italy they are often members of the criminal organization or very close to it, as a branch of the same, providing specific laundering services. They sell high quality services, contacts, experience and knowledge of money movements, supported by the latest electronic technology, especially in international financial centers such as Germany or the United Kingdom, to any trafficker or other criminal willing to pay their fees.

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