How is money laundering related to terrorist financing?

Money laundering and terrorist financing share a fundamental similarity in that both involve the movement of money with the intent to conceal its source. In the case of money laundering, the primary objective is to disguise illegally obtained funds so they appear to be from a legitimate source. This can be achieved through various methods, such as layering transactions or integrating the funds into a legal business.

On the other hand, terrorist financing also involves the use of funds that may not be legally obtained, but its purpose is distinct. The financing supports activities that are often unlawful or intended to promote violence and terrorism. While the sources of funds for terrorist activities can be legitimate or illicit, the key aspect is the movement and sometimes concealment of these funds to avoid detection and to ensure support for terrorist operations.

This option accurately reflects the core activities associated with both money laundering and terrorist financing, highlighting how money is moved and concealed, which is essential for functioning in illicit environments. The movement and concealment of funds are crucial in both contexts, making this option the most appropriate choice.