What’s the concept of money laundering?

Question

ight thanks everyone i understand now

In: Economics

Answer 1

Money laundering is meant to conceal the origin of money or funds.

Basically, suspicious large amounts of money are pretty bad flags for illegal activities (imagine someone just somehow “getting” $200,000, not through inheritance or family, or spending 5x+ the amount their income sources should earn on a regular basis), but if that same money can be traced back instead to a legitimate business income, it becomes a lot “safer” to handle. It’s essentially shuffling money through legitimate channels to remove the direct connection to illegitimate origins.

It’s shuffling money around to look legitimate.