Question

pls excellent grade for A+

1.Define money laundering?

2.what are some common examples of money laundering?

3.How is the economy impacted by money laundering?

Answer 1

1. Money laundering refers to the process of concealing the true source of excess money made through illegal activities. It can be either done through bank transfers or commercial transactions.

2. Some of the common examples of money laundering :- Money made from smuggling activities, drug markets, terrorist funding are usually hidden or disguised by the criminals through money laundering.

Smurfing is another common example practiced by the criminals by which they hide the black money earned by them by making small deposits in their bank accounts over time.

3. Money laundering negatively impacts the economy.

• It leads to an exapansion of criminal activities in the Economy and the Economic power transfers from the people of the state and the government to those criminals which motivates them to do more.
• Increase in the criminal organisations prevent other organisations to compete in the economic markets.
• It leads to severe bank failures and create liquidity problem's in the Economy.
• The economic and political stability of a state shatters completely when the criminals practice money laundering.
• It also creates negative impacts on the currencies and the interest rates of a country.