Money Laundering in Australia: Prevention and Weaknesses

Running head: MONEY LAUNDERING IN AUSTRALIA
MONEY LAUNDERING IN AUSTRALIA
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Introduction
Money laundering has been considered to be one of the organized crimes as it effects the
monetary stability of the economy. It is a crucial risk where the individuals who commit such an
act directly challenges the financial status of an economy and corrupts the people who are
associated with it (Hopton 2016). It is considered to be an organized criminal activity. It is the
method in which the money has been made in huge amounts through some kind of criminal
activity that is illegal and considered to be dirty and the method to make the money look clean is
known as money laundering. It is considered to be unlawful and it causes monetary instability in
the economy. Thus, it needs to be prevented (Masciandaro 2017).
This paper discusses the concept of money laundering and the various merits and
demerits of money laundering. It also discusses the various anti money laundering processes
which are initiated and implemented by the government in order to stop the gruesome act from
spreading. In conclusion, it summarizes the several points which have been discussed in this
paper.
Discussion
Various defenses for money laundering
Money laundering is a process by which the money obtained through illegal activities are
through a process made clean. The criminal offenders try to use their money that has been
acquired illegally to be used effectively. The money can be laundered in three techniques.
Firstly, the money can be put into a legitimate or a legal system through the process of
placement. Secondly, the source of the money that is illegal is concealed or hidden by a layering
of the system by several transactions and other book keeping trickeries. Lastly, the money that

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has been kept in the legitimate account is considered to be taken out which would be used
effectively for other purposes. Therefore it can be understood or comprehended that money
laundering is considered to be a serious offence. It is also considered as a criminal offence which
causes economic harm to a nation or a country which would create a kind of monetary instability
in the country. Therefore, this is an offence which needs to be prevented (Chong and Lopez‐De‐
Silanes 2015).
There was some crime prevention scheme needed in order to tackle the crime of money
laundering, as it had become an international concern for different nations as the illegal activities
were being carried out and the process of clearing the money and using it for legitimate purposes
was increasing and it was directly effecting the financial status and the economy of the nations
therefore, this criminal activity needed to be prevented as it was posing as a risk. Australia has
tried to combat money laundering crime and the efforts to protect the country from money
laundering crimes are guided and regulated byInternational Standards on Combating Money
Laundering and the Financing of Terrorism & Proliferation and the FATF which means that
Financial Action Task Force where the nation is considered to be a founding member. The crime
of money laundering is considered to be a serious offence as it falls under the category of the
organized crime. The crime is considered to be directed to create an impact on the financial
status of an economy as it is an organized crime it involves the money that has been obtained
through criminal activities has been put into a legitimate system in order to use the money legally
and effectively (Liss and Sharman 2015).
The Australian Government implements several defenses against the prevention of
money laundering as it effects the economy of the country directly and it is considered to be a
serious offence. The defense that has been implemented is considered to be the domestic laws