What is 'smurfing' in the framework of money laundering?

Smurfing refers to a technique used in money laundering to break down large sums of illicit funds into smaller, less suspicious amounts. This approach makes it easier to deposit these funds into financial institutions without attracting the attention of regulatory authorities. Large sums of money can raise red flags and trigger investigations, so by splitting the money into smaller quantities and dispersing them across various accounts and transactions, money launderers seek to conceal the true origin and illicit nature of the funds.

This method is particularly effective in evading detection, as small transactions may not trigger the same scrutiny as larger ones. It facilitates the movement of money through the financial system while minimizing the risk of being caught. Other options in the question do not accurately capture the specific practice or may describe different aspects of financial crime or legitimate activity, thus reinforcing why the selected answer correctly identifies the practice of smurfing within the context of money laundering.