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I’m working on a management report and need an explanation to help me learn.1.0D


I’m working on a management report and need an explanation to help me learn.1.0Definition of money laundering According to Anti Money Laundering and Counter Financing of Terrorism Malaysia, money laundering is a process of converting property or cash that gained from criminal activities to give it appropriate form.In other word, the main purpose of this process is to clean the “dirty” money. Meanwhile Swiss Criminal Code (2015), defined money laundering as “any act that is aimed at frustrating the identification of the origin, the tracking the forfeiture of assets which are known or assumed to originate from a felony”. 2.0Method of money laundering As a result, from a research by Fabian (2019), they are popular method that the criminal use to clean the money example gold, raw diamond, real estate, jewelry, and unofficial currency exchange. This information retrieve by the author trough the interview session among the money launderer. The first method is using gold. The main reason why gold is the popular method is because it easily can be melted down, and extremely difficult to trace the original source of the assets. In additional, the launderer used gold is to proclaim that gold in their possession. Furthermore, the gold can easily purchase by private shop and store it as a deposit in bank and its free or charge.The other features that make gold is preferred by launderer is that property right of the gold can be transferred without required to be withdraw it first. One of the most popular gold scandal in Malaysia is the Genneva Malaysia. According to, written by Sabrina (2020), this company can be category and was considered as one of the biggest gold scandals in Malaysia. This company actually selling the gold 25% to 30% higher than original market price.Since this have been launched by former Malaysia Prime Minister, Tun Dr Mahathir, around 35000 Malaysian has been cheated. With the great job of the legal practitioners, Geneva Malaysia was reported fined RM450 million recently. This include eight individuals, were sentenced to four to nine years of jail together with fined between RM1 million and RM4 million each. The launderer criminal was found guilty of illegal deposit taking and money laundering. Even the gold method is widely used by the money launderers, the major challenge for them is documentation of the gold. For example, If the gold is an inherited, must be a document must appear in the wealth account. Raw diamonds also an effective way to clean the dirty money. This raw diamond hardly to trace its origin and also easy to be transported. As the result from the interview between Fabian (2019) and the launderer, that diamonds usually carried in the pockets during the travel. The transaction usually between one sets up diamond company and they pay half of the diamond’s value with legal and not legal asset. After that, they need to purchase certificate of origin of the diamonds and sell again to the third party with the actual value. In order to be successful with this trick, the launderer need to hired expertise in the diamond industry. The example case that involved diamonds is the Billion-dollar fraud with diamond crossing continents that expose the Belgian Firm Omega Diamonds. This activity estimated over $3.5 billion in profits missing between diamonds mines in Africa and the stones final destination.This diamonds is at the Antwerp World Diamond Center (AWDC) (Shnidman, 2019). The real estate industry is a big opportunity for money laundering activity. The criminal can use a companies that already have nominee director to purchase real estate, and do renovation.This method is possible since the certain portion of the asset can be pay using cash.This cash payment, they will use illegal money and furthermore, it also gives benefits in terms of tax payment. After renovation work has been done, the property will be rented to public. According to in Australia, the real estate industry has been identifying as a weak spot for anti-laundering regime. Furthermore, Australia intelligence agency, AUSTRAC estimated $ 1 billion doubtful transactions exist in Australia Property market in the 2016 financial year which came from China. Using jewelry also as a preferred choice by launderer. This method as easy as gold. The jewellery is unknown and there is no standardized in terms of price.This items preserves value and easily to convert into cash. Normally there is two ways launderer jewelry as their method, they bought a jewelry shop. With this way, they can turn the dirty money to a company profit which it will legal. They can keep their partner to purchase items as physical clients. This activity minimizes the risk being caught by authorities and also seem impossible to prove that the jewellery was not inherited.This activity enables the criminal either gained for personal benefit or seeking expertise to advise them the correct value of products. For example, according to, the Tri-State Jewelers, was linked to drug-distribution and money laundering networks activities. Another method is the unofficial money exchange office. This method is recognized as risk factor for the launderer. This is due to exchange money for a large amount could lead to suspicion by others and also by law practitioners. In order to proceed with this method, the launderer ensure to make the money exchange by staying below boundary values. According to Fabian (2020), the authorities basically aware of the exchange office are a risk factors. However, is also give difficulties to the authorities since the compliance officers could become suspicious when exchanging process take place at the office.please elaborate more on definition, 1 page for introduction, 1 page for executive summary and 1 page for conclusion based in the doc given.
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