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Examples of money laundering cases

Money laundering is the process of concealing the origins of money which has been obtained illegally, usually by transfering money into offshore bank accounts, or legitimate businesses to draw attention away from the fact the money was obtained through illegal means. Below are a few well-known money laundering cases to help you understand which money laundering entails and how it's usually punished.

The Bitcoin Money Laundering Case

In 2014, Bitcoin's vice president Charlie Shrem was accused of money laundering on silk road. Alongside Robert Faiella, Charlie Shrem was arrested for alledging exchanging Faiella's money into the digital currency Bitcoin, which was then used to buy and sell drugs on the black market Silk Road. It is believed that Shrem was aware that Faiella ran an exchange service on Silk Road and, under the Bank Secrecy Act, Shrem would have been obliged to report Faiella's activities on suspicion of money laundering to the authorities. Since Bitcoin was essential to the running of Silk Road, the website itself was eventually shut down by the authorities.

HSBC

Although usually regarded as a trusted high street bank, HSBC was fined 1.9 billion dollars for money laundering in Argentina, the United States, USA and India. As a large organisation, the case of money laundering for HSBC was slightly different to Charlie Shrem's scheme; in the first year of the investigation, HSBC's anti-money laundering practices were blamed and the company was instructed to tighten its regulations. Thousands of suspicious acitvity alerts were back-logged on HSBC's system in the United Kingdom alone, and employees throughout Argentina, the United Kingdom and USA were suspected of setting up fake bank accounts, fake receipts and handling money from terrorist organisations. HSBC's money laundering cases were, in total, responsible for the largest fine ever given to a company under the Bank Secrecy Act.

Standard Chartered

Another one of the famous money laundering cases comes from Standard Chartered, who were accused of hiding billions of pounds inf transactions from Iran and the Middle East. The company was ordered to come forward and explain its actions or risk losing the right to trade in New York - Standard Chartered agreed to investigate its money laundering monitoring reports for the past two years and appointment officials to deal with the issue, as part of a settlement. However, they were again under investigation two years later for suspicious transactions concerning Hong Kong and the United Arab Empires, but again the bank claimed responsibility for the deficiency of its money laundering monitoring tactics and managed to maintain its trading license.

Illionis Man Sentenced for Money Laundering

Our final example of money laundering cases comes from the Illionis man who made his fortune in shark fins, similar to the Bitcoin money laundering case. Controversely, he served 57 months in prison, and three years supervised house arrest, despite only laundering five million dollars, which pales in comparison to the billions laundered by large banks. Rick Hixon was accused of operating Twin Peaks Trading, which specialised in selling an trading shark fins overseas; after establishing his company, Hixon developed a method to scam investors, promising a 24 percent return for potential investors but using those very funds to start other businesses, for personal use, or to pay off other investors. In this particular instance, Hixon's money laundering case was the illegal use of investor's money for purposes otherwise stated (i.e., the growth of his business).

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