Understanding what is and isn’t money laundering in Iowa can sometimes be confusing. The concept of money laundering can cover many types of behavior, and it might not be apparent at first what applies and what doesn’t.
Money laundering falls under the category of financial crimes, and the basic concept is taking illegally obtained money – stolen, drug money, illegal gambling and converting it into legitimate-seeming cash.
Traditional forms of money laundering
Money laundering has been taking place for centuries, and one of the most common forms has been using a legitimate cash-based business. Illegal money can be fed into the business and comes out looking like profits.
Other forms of legitimate money laundering include gambling at a casino with illicit money and buying and selling easy-to-move items like precious metals or gems, artwork and cars. More sophisticated money laundering methods can involve creating shell companies that exist only on paper but allow the creators to claim profits.
The rise of electronic money laundering
The rise of the internet and the proliferation of online ways to transfer, spend and win money has created new forms of money laundering. In addition, many online payment services and banks allow for a great deal of anonymity in their transactions, making money laundering challenging to detect.
Online casinos, gaming sites and auction sites offer another means of money laundering. By spending illicit money on these sites and then withdrawing winnings or buying items for bid, money can emerge “clean” from these sites. Finally, cryptocurrencies have become the latest significant way to launder money. Unfortunately, the government has next to no oversight over cryptocurrency transactions, making it an increasingly popular way to launder money.
Money laundering comes in many shapes and sizes and can be either high-tech or traditional. Therefore, understanding what falls under money laundering can be crucial when understanding your legal obligations.