MAY 11, 2016
There are many ways in which a criminal can illegally acquire money electronically. Whether it’s through malicious malware, phishing, vishing and smishing scams, account takeovers or other vectors, a commonality across all these attack methods is that fraudsters will need to move the illicit funds fast to avoid being caught and have the sum confiscated.
This is where the three stages of money laundering come into play, according to the United Nations Office on Drugs and Crime (UNODC): placement, layering and integration. In traditional money laundering schemes, the placement of funds begins when dirty money is put into a financial institution. When funds are stolen online through digital transactions at financial institutions, the process immediately jumps to layering.
This is done in three main ways:
- Moving funds within the financial system;
- Moving funds into unregulated financial e-cash systems; and
- Removing funds from the financial system altogether.