Units in Collective Investment Vehicles

• Criminals invest dirty funds into pooled vehicles, such as private equity or real estate funds, mixing tainted money with contributions from legitimate investors.
• The collective nature of these investment structures obscures the exact origin of each contribution, making illicit capital appear as routine investment.

• Criminals inject illicit capital into pooled investment products, including private hedge and mutual funds, taking advantage of lighter AML scrutiny compared to retail funds.
• By subscribing to or purchasing these fund units, they layer funds across multiple jurisdictions and accounts, making it difficult for authorities to trace the original source of the money.
• Ultimately, they redeem or 'cash out' those units as purported capital gains or legitimate returns, concealing the illicit origin of the funds.

• Illicit proceeds are commingled with legitimate assets within mutual fund or fiduciary structures labeled as receiving foreign investment.
• Multiple undisclosed contributors can covertly participate, hiding beneficial owners behind a collective vehicle.
• Subscriptions and redemptions appear as standard investment flows, making it difficult for regulators to trace actual ownership or the criminal source of funds.

• Criminals funnel illicit proceeds into private funds or hedge funds operated by the investment company.
• Weaker AML/CFT requirements around certain private funds enable looser scrutiny, allowing criminals to blend illicit capital with legitimate investments.
• Fund redemptions later appear as standard investment returns, effectively integrating dirty money into the financial system.

• Criminals inject illicit capital as fund subscriptions or redemptions in private equity or hedge funds, both forms of collective investment vehicles.
• By falsifying investor records and performance data, they disguise these transactions as ordinary investment flows, converting illicit funds into ostensibly legitimate returns.
• Offshore or multi-jurisdiction fund structures further obscure the true source of capital and beneficial ownership, complicating regulatory scrutiny.

• Criminals deposit illicit funds in collective investment funds (e.g., mutual funds, hedge funds) under shell entities or through intermediaries, masking their true ownership.
• They rapidly reallocate or redeem these units across multiple sub-accounts in different jurisdictions, adding layers to transactions and complicating audits.
• The complexity and professional management of these funds reduce transparency, hindering efforts to trace the origin of deposited assets.

• Ponzi-style investment programs are often marketed as collective investment funds promising stable or above-market returns.
• New investor contributions are used to pay earlier participants, sustaining the illusion of profitability.
• When inflows slow or scrutiny rises, promoters disappear with any remaining assets, leaving the bulk of investors defrauded.

Criminals promote their Ponzi scheme as a pooled fund, selling 'units' that supposedly represent shares of a legitimate investment. Incoming illicit funds are commingled with real investor contributions under these units, enabling fraudsters to claim continuous returns while obscuring the true origin of the capital.