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Investigating Money Laundering Schemes

Money On HookAudit investigators should become familiar with the various fraud schemes associated with taking illegal money and disguising it as legitimate income.

According to studies conducted by the Association of Certified Fraud Examiner’s, Fraudsters often devise complex schemes to integrate dirty money into legitimate money. Since these schemes are often complex, law enforcement bloodhounds do not always have the time needed to untangle the mystery. In many instances, the company’s internal audit or security department conducts the internal investigation, or an outside forensic investigative firm is contracted.

Fraudsters often use “Straws” (anonymous transients using fictitious names and addresses) to open bank accounts, fictitious DBA’s, and other guises to move the money from place to place. Once the money is deposited it is often transferred by wire to local and/or offshore accounts in such places as South America, Bermuda and Panama. Opening an offshore account is easy.

Ironically, finding a less than ethical lawyer is the difficult part. Fraudsters know that once the illegally obtained money gets into the commerce marketplace, it becomes more difficult to distinguish the illegal from the legal.

Fraudsters’ hide illegal assets in a number of ways, including:  

  • Hoarding the stash in their homes and other safe houses.
  • Breaking the illegal stash into smaller amounts and temporarily parking the money in cashier’s checks and traveler’s checks.
  • Depositing the stash in financial institutions, often opening domestic and offshore bank accounts, shell companies, mailbox drops, and wire transferring the proceeds to fictitious parties.
  • Investing the stash in offbook clandestine deals.
  • Investing the stash in legitimate securities, annuities and insurance policies often opened in a trusted friend’s name or a transient’s name.
  • Purchasing bearer instruments
  • Investing in fraudulent loans, gifts and transfers using family affiliations.
  • Investing in assets such as real estate, businesses, jewelry and other valuables.
  • Investing in cash-intensive type businesses and drawing profits.
  • Investing in small acquisitions of precious metals and shipping purchases to fictitious coconspirators avoiding paper trails.

If you have any questions or require further info please call 718-531-1105 or send an email.


This web site and these articles are not tax or legal advice and are not intended as tax or legal advice.  They are intended to provide only general, non-specific legal information and are not intended to cover all the issues related to the topic discussed.  The specific facts that apply to your matter may make the outcome different than would be anticipated by you.  This web site and these articles are based on United States law.  You should consult with an accountant or lawyer familiar with the issues. This web site and the articles contained on this web site are not solicitations.

Contact Info:

Ronald Semaria
Semaria Consulting
1408 East 66th St
Brooklyn, NY 11234
Email: info@semaria.com

Phone Numbers:

Phone: 718-531-1105
Toll-Free: 866-531-1105
Toll-Free: 888-IRSAUDIT
Toll-Free: 888-RONTAXES
Fax: 718-444-7152

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