The three stages of money laundering, and how payment firms spot them
By SendPay Business · · 2 min read
Money laundering is the process of making money from crime look like it came from a legitimate source. It's usually described in three stages: placement, layering and integration. Knowing them helps payment firms spot suspicious activity.
The three stages
- Placement: getting criminal cash into the financial system, such as through cash deposits or cash-heavy businesses.
- Layering: moving the money through many transactions, accounts or countries to hide where it came from.
- Integration: bringing the money back as if it were legitimate, such as through property, business income or investments.
Red flags payment firms look for
Rapid movement of money in and out, many transfers just under reporting limits, payments that don't fit the customer's stated business, and links to high-risk countries or known money mule accounts.
How firms respond
Regulated firms check customers' identities, monitor transactions, screen against sanctions lists and report suspicions to the authorities. In the UK, reports go to the National Crime Agency as suspicious activity reports.
Where SendPay fits
SendPay platforms give your customers GBP, EUR and USD accounts, transfers and branded Visa cards under your own brand, powered by licensed partners who run the required checks.
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This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.