Explanation:
Despite the continuously changing face of crime and the development of cybercrime, the majority of money laundering techniques discovered by law enforcement are still conventional. While cash is steadily losing favor with consumers, it is still one of the primary ways used to launder the profits of crime, according to Europol's newest strategic analysis, 'Why is cash still king?'
Almost all sorts of crime utilize cash to aid money laundering at some point, not only classic crimes that create cash gains, but also dangers posed by emerging technologies such as virtual currencies, where currency is employed as a tool to conceal the unlawful origin of revenues.
In the EU, the use of cash is the most common cause for suspicious transaction reports in the financial system, accounting for almost 30% of all reports. Around a third of all inputs to Europol in the area of money laundering are reports on questionable physical currency transactions.
Despite a small drop in the usage of cash for payments in the EU, demand for large denomination notes not typically used for payments, such as the EUR 500 note, has remained stable. Over 30% of the value of all banknotes in circulation is represented by the EUR 500 note alone (1). This raises issues about why they're being used and if they're tied to illegal activities, both of which should be investigated further.
Linking funds to criminal activity continues to be a difficult task for law enforcement. "Criminals' use of cash continues to be one of the most important impediments to effective investigations and conviction," says Europol Director Rob Wainwright. "It's a danger that hasn't gotten enough international attention or legislative responses." Criminals frequently exploit a fragmented enforcement strategy at national and international levels, as well as varied regulatory regimes throughout EU Member States, by adapting their techniques and routes to take advantage of these gaps. If we are to combat these illegal activities, we must boost our efforts to improve international collaboration and information sharing, as well as build a more harmonised policy among EU Member States regarding cash flows inside the EU."
