A prepaid financial instrument purchased to send payments securely. Commonly used for moderate transactions, money orders are available through postal services, financial institutions, and some retail outlets. They provide a simple and trusted method for sending funds to a specified recipient.
Main/
Money Orders
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Code
IN0040
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Name
Money Orders
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Version
1.0
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Category
Fiat (Physical/Digital) & Paper-Based Payment Instruments
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Created
2025-02-04
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Modified
2025-04-02
Related Techniques
- Criminals purchase multiple money orders in small denominations to stay below reporting thresholds and reduce suspicion.
- They aggregate these money orders to fund real estate purchases, fragmenting the illicit funds' origin.
- Real estate sellers or intermediaries may view money orders as simple, cash-equivalent instruments, overlooking the underlying structuring scheme.
- Offenders purchase several money orders from different vendors, each under the limit that would trigger identification or scrutiny.
- Depositing or cashing these money orders in separate, smaller transactions helps introduce illicit funds while staying below the radar of suspicious activity monitoring.
- Criminals purchase multiple small-denomination money orders with illicit cash to bypass ID requirements, then deposit or redeem them separately.
- By keeping each money order amount low, smurfs evade reporting triggers that would typically apply to larger lump-sum transactions.
- Criminals purchase money orders with illicit funds, claiming these funds are personal gifts or charitable support (e.g., presenting gift letters).
- By structuring transactions below reporting thresholds, they avoid triggering AML reviews typically applied to larger remittance payments.
- The false documentation (gift letters, familial support claims) matches typical remittance usage, reducing scrutiny and enabling illicit funds to pass as standard remittance activity.
- Criminals supply illicit funds to third parties to purchase money orders, avoiding direct attribution of payer details.
- When consolidated under different purchaser names, the financial trail becomes segmented and more difficult to trace back to the true origin.
- Limited due diligence at the point of purchase makes it easier for criminals to exploit these instruments for layering funds.
- Controlled MSBs issue multiple money orders below reporting thresholds, enabling criminals to convert large amounts of illicit cash into official-looking instruments.
- Complicit staff deliberately overlook suspicious structuring, thereby obscuring transactional trails and bypassing typical reporting requirements.
- Criminals purchase money orders with illicit cash in amounts kept under reporting thresholds, exploiting their reputation as lower-risk payment tools.
- These structured purchases are then rapidly deposited or redeemed at various financial institutions, disguising the origin of funds.
- Using different branch locations and multiple small-value orders obscures the total amount being laundered and evades detection.
- Similar to checks, money orders can be scanned or photographed for remote deposit, allowing repeated submission across several accounts.
- Criminals may alter payee information or forge endorsements to conceal the true owners and sources of funds.
- Once cleared, the illicit proceeds are withdrawn or transferred, compounding the difficulty for financial institutions to trace the transactions.
- Scammers direct victims to purchase money orders for the required 'fees' under urgent or fabricated reasons.
- Criminals then cash or deposit these money orders into multiple accounts, quickly dispersing the funds to mask their origin.
- Criminals purchase multiple money orders in amounts below reporting thresholds to convert physical cash into more structured instruments.
- Depositing or cashing these money orders at varied times and locations obscures the transaction trail.
- Individual money orders often remain below reporting thresholds, making it difficult for financial institutions to identify potential structuring or aggregated sums of illicit proceeds.