Definition of Money Laundering
Chapters in this video
- 0:00 The bank robber scenario: why dirty money needs laundering
- 1:52 What money laundering is and the counterfeiting trap
- 2:58 Why criminals target securities markets
- 3:58 Which came first: Bank Secrecy Act vs. USA PATRIOT Act
- 4:48 Does the Bank Secrecy Act apply only to banks
- 5:02 Rapid-fire exam recap
What this video covers
- The precise definition of money laundering (disguising illegally obtained real money) and how it differs from counterfeiting (creating fake money)
- Why the securities industry is a prime target: large transaction volumes, complex financial instruments, and the speed of electronic transfers across borders
- The Bank Secrecy Act (BSA) of 1970 as the foundational law requiring record-keeping and suspicious activity reporting by all financial institutions
- Why the BSA applies to broker-dealers and not just banks, despite the name
- The USA PATRIOT Act of 2001 as the enhancement that strengthened AML rules, added customer identification requirements, and targeted terrorism financing
- Why the BSA and PATRIOT Act work together, with neither replacing the other
- How FINRA requires every member firm to maintain a written AML compliance program
Read the full lesson, free
This video's complete written lesson is free to read in the CertFuel app, no signup wall. The complete SIE course in the app is free too, including adaptive practice questions and spaced-repetition flashcards.