Money laundering is an attempt to hide the origin of property or money that has been gained by illegal means. The purpose is to make that money or property appear as if it has been acquired legally. Money laundering is deliberate criminal activity. It centres on covering up illegally-acquired property.
Money laundering is an integral part of financial crime, the grey economy and organised crime. As such, it is also an established part of international crime.
A person is guilty of money laundering if they
- transmit or
property acquired through an offence in order to obtain benefit for themselves or another or to conceal the illegal origin of said property. A central aspect is that the offender is aware or suspects that the property has an illegal origin and performs one or more of the above actions despite this.
Don’t become a mule
Offenders may attempt to lure “mules” into money laundering activities to help cover up the origin of the money. Mules may be recruited in various ways.
Treat email-based offers of work in which the primary activity is the receipt or conveyance of money or wares with caution. Your account may be used as part of money laundering operations, allowing the offenders to cover their tracks. By receiving money without being aware of its origin, you may be committing money laundering. Acting as a mule is a punishable offence.
Predicate offences of money laundering are often linked to tax fraud, other forms of fraud and crimes such as drug smuggling and cybercrime. Cybercrime, in particular, has seen a recent increase. Additionally, corruption is a significant phenomenon associated with money laundering internationally.
Money laundering is combated by reporting suspicious activities
Many parties involved in business may encounter suspicious business activities that may be linked to money laundering. Such parties include
- parties in the investment, financing and insurance sectors;
- virtual currency providers;
- lawyers and
- real estate businesses.
These parties have an obligation to report any suspected money laundering they may encounter. Parties that have the reporting obligation, which, in addition to the above, also include a number of others, are very important in combating money laundering.
What does it mean to have the reporting obligation?
Parties that have the reporting obligation must identify their customers and verify their identity. A party who has the reporting obligation must record data on their customers’ transactions, the nature and extent of their business and the grounds upon which they are using a service or product (obligation to obtain information and ongoing monitoring).
Suspicious business transactions must be reported. If you have the reporting obligation, you can file a report on the police website.
Suspicions related to virtual currencies must also be reported
Virtual currency providers also have a reporting obligation under money laundering legislation. Virtual currency providers must identify their customers and report any suspicious transactions they discover. In Finland and internationally, criminal use of virtual currency and money laundering performed with virtual currency are typically associated with the drug trade and various forms of fraud.
In Finland, observance of money laundering legislation is monitored by the Financial Supervisory Authority, National Police Board, Patent and Registration Office, Southern Finland Regional State Administrative Agency and the Finnish Bar Association. In Åland, monitoring is performed by the Government of Åland and Lotteriinspektionen.
Money laundering offences may be punished with a fine or imprisonment:
- Money laundering will result in a fine or a maximum of two years of imprisonment.
- Aggravated money laundering will result in a minimum of four and a maximum of six years of imprisonment.
The Financial Intelligence Unit is the expert authority on money laundering
The mission of the Financial Intelligence Unit is to prevent, expose, detect and commence investigation into crimes and terrorist financing. The unit’s operations are controlled by the Act on the Financial Intelligence Unit.
The unit receives reports regarding suspicious business transactions from parties subject to the reporting obligation, processes and analyses relevant information and provides it to other Finnish authorities. They are also involved in close international co-operation. The Financial Intelligence Unit has the right to receive, process and disclose information.