Placement, layering, integration, blah, blah, blah

Unnecessary complexity clouds both the definition of money laundering and understanding of the role and capabilities of financial intelligence units, so limiting their potential contribution to the fight against crime, says Tristram Hicks . He contends that suspicion, too, is not arcane – it can be taught.

Tristam Hicks may be contacted via www.aml-consulting-global.com

Three for one

The three phases – placement, layering and integration -are widely accepted to describe the money laundering process (eg, by the International Compliance Association). It may indeed be useful for practitioners in the regulated sector to have such terms to help raise awareness of how their sector or their function may be vulnerable to money laundering. It may help money laundering reporting officers (MLROs) judge whether a certain activity is suspicious. It may have other uses that I have missed; if so, please forgive my simplistic approach. It has definitely served to confuse a generation of law enforcement and justice professionals by obscuring the fundamental simplicity of the money launderer’s function. At the same time, it has encouraged them to think that the investigation of money laundering is difficult, expensive, time-consuming and (generally speaking) futile. Not that encouragement was needed, most police and prosecutors already think that fraud investigation is all of those, and in their collective psyche, fraud is the same as money laundering. After all, from a safe distance, the two look alike. If you want to know why money laundering doesn’t get prosecuted, you need look no further. The criminal justice team are still in the bunker.