#DontBeAMule (Money Laundering Explained)

money laundering
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What is a money mule?

money mule is a person who transfers illegally obtained money between different payment accounts, very often in different countries, on behalf of others.

Money mules are also recruited by people to receive money into their bank account, in order to withdraw the money and in most cases transfer it overseas, receiving a commission in return for the provided services.

EUROPOL, who claims that over 90% of money mule transactions are linked to cybercrime such as malware and online fraud, sheds some light on money muling, including how money mules are recruited and who is targeted.

 

Who do people target?

In recruiting money mules, people tend to target people who fit one or more of the following characteristics:

  • Recently arrived to the country
  • Students
  • Unemployed
  • In economic distress

 

What are the implications of being a money mule?

Although money mules are not directly involved in the crimes which generate illicit profits, they are acting illegally by laundering the proceeds of crime, and therefore facilitating the operations of international criminal syndicates.

 

Penalties for acting as a money mule can range from a fine to imprisonment, along with the prospect of being prohibited from securing a mortgage or opening a bank account.

 

What is Money Laundering?

Money laundering is the process where profits that are derived from illegitimate means are given the appearance of coming from a legitimate source. Money laundering allows people to use funds from proceeds of crime for personal use because it turns ‘dirty’ money into ‘clean’ money. The money laundering process has three stages:

  1. Placement: physical cash from proceeds of crime enters the financial system.
  2. Layering: illegal funds are moved around to disguise or conceal their illegitimate source.
  3. Integration: the proceeds of crime funds appear to have a legitimate source and are then able to be used without raising suspicion.

Money Laundering under NSW and Commonwealth Legislation

NSW Legislation

In NSW, money laundering is dealt with by Part 4AC of the Crimes Act 1900 (NSW). If you are charged under this part, you may be liable for imprisonment for 20 years if found guilty of the offence of money laundering.

 

The prosecution must prove beyond reasonable doubt that the person has knowingly dealt with the proceeds of a crime and that they deliberately tried to conceal their use of those proceeds.

 

If a person has dealt with the proceeds of crime knowingly but did not try to conceal it, the maximum penalty is reduced to 15 years.

 

If a person has been reckless in dealing with the proceeds of crime, the maximum penalty is 10 years.

 

Commonwealth Legislation

Money laundering offences are defined in Part 10.2 of the Criminal Code Act 1995 (Cth) under the Commonwealth regime.

 

The offences operate on a sliding scale of seriousness.

 

The Court must firstly consider how much money is involved in the offence. Penalties range from the least serious (amounts less than $1,000) to the most serious (amounts in excess of $1 million).

 

The second consideration the Court must take into account is what level of knowledge the person had of the illegally obtained money – negligent, reckless and intentional.

 

The most serious offence of laundering over $1 million with intent carries a maximum penalty of 20 years imprisonment.

 

The relevant penalties are outlined below:

400.3 400.4 400.5 400.6 400.7 400.8
Value of money/ property $1million or more $100,000 or more $50,000 or more $10,000 or more $1000 or more Any value
Penalty Ss (1) Intention 25 years 20 years 15 years 10 years 5 years 12 mths
Ss (2) Reckless 12 years 10 years 7 years 5 years 2 years 6 mths
Ss(3) Negligent 5 years 4 years 3 years 2 years 12 mths $1,100 fine (10 penalty units)

 

#DontBeAMule Campaign

As a response to the growing use of ‘money mules’ the AFP, in partnership with Europol and the European Money Mule Action (EMMA), is launching the #dontbeaMule campaign to raise awareness of the ways people will recruit unwitting individuals to launder money offshore.

 

People who believe they have been lured into being a money mule should report it to Report Cyber (www.cyber.gov.au/acsc/report) or their local police. They should also notify their bank or payment provider/service.

 

If you or someone you know needs legal advice or representation for a criminal law matter, contact the team at Hamilton Janke Lawyers 24/7 by calling 4038 1666.

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