Money is a medium whcih determines the value of anything.
Money laundering is the process of creating the appearance that large amounts of money obtained from serious crimes, such as drug trafficking or terrorist activity, originated from a legitimate source.
This is one of the risks of commercial banks and the economy of any country.
There are three steps involved in the process of laundering money:
- Placement,
- Layering, and
- Integration.
Placement refers to the act of introducing "dirty money" (money obtained through illegitimate, criminal means) into the financial system in some way.
"Layering" is the act of concealing the source of that money by way of a series of complex transactions and bookkeeping gymnastics.
"Integration" refers to the act of acquiring that money in purportedly legitimate means.
