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What is money laundering?

FIU-the Netherlands defines money laundering as:

'Carrying out acts, or having others carry out acts through which capital gains that have been concealed from the authorities acquire ostensibly legitimate origins. The aim of money laundering is to obscure the provenance of money'.

Money laundering thus involves transactions that have the aim of providing criminal proceeds with an ostensibly legitimate provenance. Since 6 December 2001 money laundering has been a criminal offence in its own right; it is not necessary to be convicted of a basic offence such as drug trafficking or trafficking of human beings. The Dutch Criminal Code includes the following three forms of money laundering:

  • Deliberate money laundering – Section 420bis
  • Simple money laundering – Section 420bis.1
  • Habitual money laundering – Section 420ter
  • Culpable money laundering – Section 420quater
  • Simple money laundering – Section 420quater.1

Money laundering occurs in several manifestations. Regardless of the type of money laundering involved, we can distinguish three stages in the process:

1.    Introducing money obtained through crime into the financial system (placement)

2.    Undertaking a series of transactions to conceal the criminal provenance of the assets (layering)

3.    Integrating the assets into the legitimate economy (integration)