Which are the three stages of money laundering?

The three stages of money laundering are placement, layering, and integration. In the placement stage, illicit funds are first introduced into the financial system. This can be done through various means, such as depositing cash into banks or using the money to purchase assets. The goal during this stage is to distance the money from its illegal origins.

The layering stage involves conducting a series of transactions to obscure the original source of the funds. This may include transferring money between different accounts, converting cash into multiple forms, or using shell companies to create complex ownership structures. This process is crucial as it makes it challenging for authorities to trace the funds back to their illicit origins.

Finally, the integration stage involves reintroducing the laundered money into the legitimate economy, making it appear as though it was earned legally. This may involve investing in legal businesses or purchasing assets, which allows the launderer to use the money without raising suspicion.

The options that feature "transformation" or "isolation" instead of "layering" and "integration" do not accurately represent the conventional framework of money laundering stages recognized in financial crime literature. Therefore, the correct answer highlights the widely accepted terminology and stages that frame the money laundering process effectively.