money laundering

Money laundering is the process of disguising the origins of illegally obtained funds so that they appear to come from legitimate sources, typically through layered transactions, shell entities, or otherwise lawful businesses. Federal law criminalizes it under 18 U.S.C. sections 1956 and 1957, and a related system under the Bank Secrecy Act requires financial institutions to maintain controls to detect and report it. The cryptocurrency exchange Binance and its founder Changpeng Zhao pleaded guilty in 2023 to anti-money laundering failures.