What is an example of a "layering" technique in money laundering?

Layering is a crucial phase in the money laundering process, aimed at obscuring the origins of illicit funds. It involves the use of various techniques to separate the illicit money from its source, making it difficult to trace back to illegal activities.

Creating complex ownership structures is a classic example of layering because it helps to mask the true ownership of assets or funds. By setting up multiple layers of companies, trusts, or legal entities, money launderers can create confusion and complicate law enforcement’s ability to track where the money originated and how it flows. This method can effectively hide the relationship between the original source of the funds and the current holder, significantly complicating investigation efforts.

In contrast, techniques such as structuring deposits, while also a layering method, are more closely related to the placement stage where the illicit funds are first introduced into the financial system. Investing illicit gains into legitimate businesses can be a method of integrating the money into the economy rather than specifically layering it, while transactions involving high-value assets serve more as a way to conceal transactions than layering per se. Each of these serves a different purpose within the larger framework of money laundering, but complex ownership structures distinctly illustrate the concept of layering by complicating the trail of the funds.