I have always been fascinated by money laundering, particularly its relationship to fraud. While the topic has long been considered the financial twin of narcotics investigations, the lack of broader interest in money laundering on its own never made sense to me. From my perspective, money laundering is the epitome of fraud methodology. It involves the concealed transfer of assets by masking them in the mundane normalcy of financial transactions. In short, the methodology of money laundering exists in every fraud scheme. As a practitioner in the field, it seemed only natural that the evolving anti-money-laundering (AML) tools would be widely recognized and used by fraud investigators and forensic accountants.
Yet nothing could be further from the truth. When I began looking and applying money laundering tests to typical fraud cases, I was often met with confusion. When I suggested that finding the individual benefit could be reversed to find the underlying fraud, I found skepticism. When I used the phrase “money laundering,” I would get “But this is not a drug case” in reply.
In 2005, the Association of Certified Fraud Examiners (ACFE) approached me about updating their money laundering course and I leaped at the opportunity. It gave me the chance to reshape the conversation away from narcotics trafficking and toward white collar crime. This shift in perspective was possible, too, given the Patriot Act, which had already pushed AML compliance in the same direction with ...