MONEY LAUNDERING

MONEY LAUNDERING

Money laundering is a process used by offenders who attempt to conceal the true origin and ownership of the proceeds; these proceeds are results of criminal activities. It allows them to maintain control over the proceeds and provide a legitimate cover for their source of income.

The laundering of the proceeds that result from criminal activity is done through the financial system. The people who are involved in such an action exploit the facilities of the financial institutions of the world. Such an action is done easily under these conditions of free movement of capital. Banks involved in such actions risk to lose their market reputation.

Money laundering is accomplished in three stages, involving numerous transactions of the launderers. Here they are:

placement it means a physical disposal of cash proceeds got from illegal activity

layering it implies a separation of illicit proceeds from their source; there are created complex layers of financial transactions meant to disguise the audit trail

and they assure anonymity

integration supposing that the laundering process was successful, the proceeds are placed back into the economy; they re-enter the financial system and seem to be normal business funds.

Text Comprehension

Answer the following questions:

What is money laundering?

Where does it come from?

What do the people involved in laundering do?

How is money laundering accomplished?

Which are the stages?

Can you describe them?

Is money laundering to be found in Romania?

Vocabulary

Accounting (contabilitate)

Arrears (bani datorati dar care nu sunt platiti la scadenta)

Audit (examinarea independenta a rapoartelor financiare ale unei organizatii si formularea ulterioara a unei opinii)

Balance sheet (bilant)

Book value (valoarea contabila a unui active)

Capital gain/ loss (castig/ pierdere rezultat/a din operatiunile de capital)

Depreciation (diminuarea valorii unui active imobilizat)

Financial accounting (contabilitate financiara)

Goodwill (diferenta dintre valoarea activelor nete separate ale unei companii si valoarea totala a acesteia)

Gross margin (diferenta dintre incasarile din vanzari ale unei firme si costurile bunurilor vandute)

Money laundering (spalarea banilor)

Net interest (dobanda platita la un cont de economii sau la unul current, la o banca britanica)

Net margin (marja neta/ bruta )

Outstanding (expirat, neachita)t

Profit and loss account (cont de profit si pierderi)

Reconcilement (reconciliere)

Trial balance( balanta de verificare)

Value data (data la care anumite fonduri devin disponibile pentru utilizare)