Placement
Definition
The first stage of money laundering, in which illicit cash is introduced into the financial system. Methods include cash deposits, currency exchange, purchase of monetary instruments, and cash-intensive business commingling. Placement is the stage most vulnerable to detection because physical cash must interact with formal financial infrastructure.
Related terms
- Integration
- The third stage, in which laundered funds re-enter the legitimate economy as apparently clean wealth. Common integration mechanisms include real estate purchases,...
- Layering
- The second stage, designed to sever the audit trail between the illicit source and the funds. Layering typically involves a rapid series...
- Trade-Based Money Laundering (TBML)
- A typology that uses international trade transactions to transfer value across borders. Mechanisms include over-invoicing or under-invoicing goods, falsifying quantities or descriptions,...
- Beneficial Owner
- The natural person who ultimately owns or controls a legal entity or arrangement, as distinct from the nominee or registered owner. Anti-money-laundering...
- Shell Company
- A legal entity with no genuine business operations, created to receive fraudulent payments. In vendor fraud, the fraudster controls the shell and...
- Smurfing (Structuring)
- Breaking a large cash sum into multiple smaller transactions, each below the mandatory reporting threshold, to avoid triggering Currency Transaction Reports or...
- Structuring (Smurfing)
- A placement-stage technique in which large cash amounts are broken into multiple smaller deposits or transactions, each deliberately kept below the threshold...
Explained in these topics
- Money Laundering: Placement, Layering, and IntegrationThe first stage of money laundering, in which criminal proceeds, typically cash, are introduced into the financial system through bank deposits, currency excha...
- Money Laundering Typologies and Audit IndicatorsThe first stage of money laundering, in which illicit cash is introduced into the financial system. Methods include cash deposits, currency exchange, purchase...