Layering

By inserting complicit or unwitting intermediaries, criminals add multiple transactional steps that distance illicit funds from their origin, making it significantly harder for investigators to trace the ultimate beneficiaries. This is the primary objective of intermediary-facilitated transfers.

Criminals use mixers to blend illicit funds with legitimate deposits in pooled or decentralized protocols, explicitly severing the on-chain trail between the source and destination. This tactic distances the illicit proceeds from their origin, exemplifying a core layering strategy.

Custodial mixers combine user deposits in an operator-controlled wallet and redistribute them as unrelated outputs. This process introduces multiple transaction layers that conceal illicit proceeds and complicate investigative tracing efforts.

Decentralized mixers combine and redistribute crypto funds through peer-to-peer protocols and smart contracts, explicitly obscuring the transaction trail and making it more difficult for investigators to connect illicit proceeds to their criminal source. This is a core layering strategy that distances criminal proceeds from their origin.

Chain hopping involves repeatedly transitioning crypto assets across multiple blockchains, introducing new tokens or stablecoins to increase the complexity of the transaction chain and obscure the origins of illicit funds. This layering tactic exacerbates the difficulty of tracing funds back to their criminal source.

Burn-and-mint transfers sever the traceable link between original and newly created tokens by permanently destroying assets on one chain and recreating them on another. This obfuscates the true origin of funds and complicates forensic analysis, aligning directly with the objective of layering, which is to obscure illicit proceeds through complex transactional steps.

Cross-chain bridges fragment transaction histories across multiple blockchains, creating additional complexity that obscures the origin of illicit funds. This aligns with the layering stage by distancing proceeds from their source and hindering investigators' ability to trace the assets.

Repeated cycles of buying and selling valuable assets create transactional complexity to disrupt the audit trail.

Illicit antiquities trade involves repeatedly buying and reselling artifacts across borders at manipulated valuations, forging provenance, and altering ownership records to obscure their criminal origin. This complexity makes tracing the underlying illicit funds extremely difficult, representing a quintessential layering process.

Falsifying invoices allows criminals to create complex cross-border transactions and conceal illicit funds within legitimate trade flows, thereby obscuring the illicit origin of the assets.

Criminals use repeated or duplicated invoicing to generate multiple transaction records under normal trade finance processes. This obscures the audit trail and distances illicit proceeds from their criminal origin.

By overstating costs and issuing inflated invoices, criminals embed illicit funds within seemingly legitimate trade or procurement expenses, obscuring the direct link to their illicit source. This manipulation of invoice pricing functions primarily as a layering tactic, creating complex transaction trails that hinder the detection and tracing of illegal proceeds.

Trade misinvoicing exploits falsified invoices and documentation to create multi-layered cross-border transactions, obscuring the money trail linking illicit funds to their criminal origin. By introducing deliberate inaccuracies in trade values and quantities, criminals make it harder for investigators to trace the true source of the funds.

Money mules channel illicit proceeds through multiple accounts and jurisdictions, creating layers of separation from the original criminal source and obscuring the true beneficiaries of the laundered funds.

Criminals repeatedly transfer illicit funds across multiple regulated-exchange mule accounts, often using forged KYC documents. These transactions deliberately obscure the illicit source, creating a complex audit trail that distances the funds from their criminal origins.

By repeatedly converting illicit cash into cryptocurrency at multiple ATMs—often across regions—criminals create additional transactional layers to obscure both the origin and destination of illicit funds, distancing proceeds from their criminal source.

Repeated offsetting transactions and cross-border value transfers via IVTS create complex trails that obscure the criminal source of funds, adding multiple layers of distance between the proceeds and their illicit origin.

This technique involves creating complex cross-border transaction chains through pseudo-trade documentation and multiple intermediaries. It explicitly obscures the audit trail and disguises the illicit origins of funds.

Daigou coordinators employ multi-step cross-border transactions, including pooling funds outside formal banking channels and paying surrogate shoppers in cash. This deliberately obscures the money trail and distances illicit proceeds from their source.

Structuring also supports layering by breaking down large sums into multiple smaller transactions executed across various accounts or channels. This explicitly obscures the origin and trail of illicit funds through distributed activities.

Criminals repeatedly deposit illicit proceeds into online gambling accounts in small increments, commingling them with legitimate wagers. They subsequently move these funds across multiple accounts and jurisdictions, explicitly aiming to obscure the origin of the funds and complicate detection.

Criminals purchase in-game currencies or items with illicit funds, then trade or resell them across multiple accounts or jurisdictions to obscure the original source of the money. This creates complex transactional chains that distance the proceeds from their criminal origin.

Criminals settle mining expenses using illicit funds, effectively receiving newly minted coins with no prior transaction history, thereby breaking the original money trail. This constitutes a deliberate layering strategy to distance proceeds from their illicit source.

Criminals pay for remote mining services with illicit funds, receiving newly generated coins that appear unlinked to the original dirty money. This setup adds an extra layering step, obscuring the transactional trail and distancing proceeds from their criminal source.

Fictitious vendor accounts generate sham invoices and payment flows, introducing multiple transactional layers that obscure the true origin of illicit funds. By mixing these fake expenses with legitimate business outlays, criminals complicate the money trail and impede detection.

Through frequent automated transfers across multiple accounts and currencies, criminals create complex transaction chains designed to obscure the origin of illicit proceeds and hinder straightforward audits.

Criminals generate or use multiple virtual IBANs to insert additional layers between illicit proceeds and their true origin, hindering investigative tracing.

Criminals exploit e-commerce and marketplace manipulation by fabricating or inflating online sales, payments, or refunds to distribute illicit funds across numerous transactions and platforms, thereby breaking the direct link to their illicit origins. Blending illicit proceeds with legitimate sales flows explicitly obscures the true source of funds, constituting a core layering strategy.

Trade diversion leverages complex shipping routes, multiple intermediaries, and falsified trade documentation to create numerous transactional layers that obscure the link between illicit funds and their criminal source. By intermixing legitimate and illicit goods and payments across various jurisdictions, this technique makes it significantly harder for investigators to trace and attribute the proceeds.

Instant exchange services enable rapid, repeated swaps across multiple fiat or crypto assets, creating numerous transactional steps to obscure the illicit funds' origin. This iterative conversion process is the primary strategic goal, explicitly breaking a clear audit trail back to the criminal source.

Through repeated circular (or 'carousel') transfers across multiple accounts and jurisdictions, criminals deliberately obscure the illicit source of funds by breaking audit trails and hiding beneficial ownership, thereby accomplishing a classic layering objective.

By conducting repeated re-exports, over- and under-invoicing, and other trade-based maneuvers within Free Trade Zones (FTZs), criminals create complex cross-border transaction chains that obscure the original illicit source of funds.

Criminals systematically inject illicit funds into crowdfunding platforms under the guise of legitimate donations, often splitting contributions into smaller amounts across numerous fake or co-opted donor accounts. By commingling these funds with genuine contributions and leveraging weak KYC controls, they create convoluted transaction paths that obscure their origins and frustrate investigative tracing.

Repeated over- or under-valued purchases and resales obscure ownership and complicate the tracing of illicit origins, providing a distinct layering dimension beyond the final integration step.

Criminals exploit the subjective and portable nature of jewelry to repeatedly trade and resell items across various jurisdictions, creating opaque transaction chains that distance illicit funds from their criminal origins. By inflating or underreporting values during each sale, this technique primarily supports layering to obscure the original source of funds.

Criminals orchestrate multiple auction transactions with manipulated collectible valuations specifically to obscure and distance illicit funds from their criminal origin. They leverage minimal AML oversight at some venues to create complex money trails that hinder detection.

Successive or inflated art sales create complex transaction chains that distance illicit funds from their source, hampering investigators' ability to trace proceeds back to their criminal origins. This is the primary layering objective of art market manipulation.

Repeated cross-border shipments, falsified shipping documents, and under-/over-invoicing add transactional complexity, effectively obscuring the original source of criminal proceeds.

By repeatedly moving diamonds across borders, misdeclaring shipments, and reselling them in different jurisdictions, criminals create multiple transactional layers that obscure any direct link between illicit proceeds and their criminal source.

By purchasing precious metals or gemstones with illicit funds and physically smuggling them across borders, criminals introduce multiple transactional steps that obscure the illicit origin of the proceeds and circumvent conventional financial oversight. The core strategic purpose of this technique is to complicate the audit trail, distancing the assets from their criminal source.

Criminals falsify or alter financial statements and accounting entries to create misleading records, explicitly obscuring links between illicit funds and their true source. This complexity frustrates investigators' ability to trace the origin of proceeds, fulfilling a clear layering objective.

Criminals execute multiple cross-border transactions in precious metals and stones to obscure the original illicit source of funds. They leverage minimal formal identification requirements and complex commodity valuations to add layers of transactional distance.

Criminals exploit gold's anonymity and portability to conduct complex cross-border transactions, explicitly obscuring the audit trail and distancing illicit funds from their origins.

By forging import documents, rotating shipments of diamonds across multiple jurisdictions, and artificially inflating declared values, criminals create complex transactional chains that obscure the origin of illicit funds within legitimate diamond trade flows.

Criminals use complex investment vehicles and multi-jurisdictional account structures to conceal the origin of illicit funds. They employ repeated cross-border transactions that complicate tracing and preserve anonymity.

Labeling illicit funds as inbound foreign capital creates cross-border opacity, distancing the money from its criminal source.

Repeated cross-border transactions and complex portfolio movements within these investment companies explicitly serve to distance illicit proceeds from their origin, complicating any audit trail.

Criminals exploit secrecy-friendly jurisdictions by executing multiple cross-border transfers and layered corporate structures, explicitly distancing illicit proceeds from their source to thwart straightforward detection of their origin.

Once obtained, these offshore prepaid or e-wallet accounts are repeatedly topped up below reporting thresholds and used in cross-border transactions, blending illicit funds with legitimate flows. This practice obscures origins and creates multiple transactional layers.

Criminals route illicit funds through offshore gambling operations, blending them with legitimate player transactions and complex payment flows to muddy the audit trail and obscure direct links to the original criminal source.

Criminals exploit multiple in-game transactions, such as purchases, account transfers, and item resales, specifically to create transactional complexity and obscure the illicit origin of funds. This strategy limits investigators' ability to trace the true source of the funds and represents the primary strategic objective of using virtual worlds in the laundering process.

Through frequent token swaps on decentralized exchanges (DEXs) and rapid purchase/resale of digital metaverse assets (e.g., virtual real estate, NFTs), criminals create multiple complex transactions that deliberately obscure the funds' illicit origin. These rapid trades and wash transactions serve to distance the proceeds from their original source.

Cross-platform trading involves multi-step flows across various gaming ecosystems, third-party brokers, and external sites, explicitly aiming to obscure the trail of illicit funds by distancing them from their criminal origin. This is the primary objective of employing these cross-platform methods.

Once in-game assets or currency are obtained, criminals engage in extensive microtransaction splitting, item swaps, and cross-account transfers to obscure the trail, effectively distancing illicit funds from their source.

Criminals repeatedly convert illicit proceeds among various blockchain tokens and networks, leveraging smart contracts and cross-chain bridging to create a convoluted transactional trail that distances funds from their criminal origin, complicating investigative efforts.

Repeating conversions and transfers between payment tokens and other assets explicitly obscure the origin of illicit proceeds and distance them from their source. The structured use of smaller transaction amounts, known as smurfing, further complicates traceability by evading detection thresholds.

Cross-chain token wrapping and bridging create multi-hop transaction pathways across diverse blockchain networks, explicitly increasing complexity to obscure the source of illicit funds and hinder investigative tracing. This process fulfills the purpose of layering by distancing criminal proceeds from their origin.

Criminals engage in frequent governance token swaps across multiple decentralized platforms and chains to deliberately create dense transactional webs. This tactic obscures the original source of illicit funds, making it difficult for investigators to establish a clear audit trail.

By repeatedly swapping or staking tokens across multiple blockchains via DeFi protocols—including aggregators and liquidity pools—criminals create convoluted transaction chains that mask the original illicit funds. This deliberate complexity is a hallmark of layering, as it distances the proceeds from their criminal source and frustrates traditional AML tracing methods.

Criminals exploit utility tokens by repeatedly swapping or bridging them across multiple blockchains. This creates additional transactional layers that obscure the origins of illicit funds and complicate investigative traceability.

Criminals forge or manipulate shipping documentation to add complexity to trade-based transactions, creating additional layers that obscure the true origin of illicit funds behind seemingly legitimate trade flows.

Fictitious cross-border trades rely on inflated invoices, forged shipping documents, and complex routing across multiple jurisdictions to obscure the illicit origin of funds and create numerous transactional layers.

Ghost shipping involves the use of fictitious trade documentation and nonexistent shipments to create the appearance of legitimate commercial transactions. By cycling illicit funds through these false invoices and bills of lading, criminals introduce additional layers of complexity that obscure the origin of proceeds, fulfilling the core layering objective.

Transaction chaining involves repeated transfers across multiple accounts, platforms, or blockchains. It uses rapid cross-asset "chain hopping" and micro-transactions to systematically distance illicit funds from their origin. This complexity explicitly frustrates efforts to trace the money trail.

Wire transfer chains involve multiple rapid cross-border or multi-bank transactions specifically designed to obscure the origin of illicit proceeds and frustrate investigative attempts to trace funds back to criminal sources. The sequential transfers split or move sums through various accounts, creating complex layering that hinders detection.

Peel chains repeatedly split large cryptocurrency balances into numerous small transfers across many newly generated addresses, creating a convoluted transaction trail that obscures the true origin of illicit funds. This multi-hop process adds layers of complexity intended to distance the proceeds from the underlying criminal activity.

Criminals rotate letters of credit among multiple shell companies and banks, creating a complex chain of trade finance transactions that obscures the audit trail and distances illicit proceeds from their origin.

Third-party payments explicitly introduce one or more additional steps—via external individuals or entities—between the criminal and the illicit funds, fragmenting the audit trail and making it harder to trace proceeds back to their criminal source. This added transactional complexity is a hallmark of layering.

Through falsified or inflated trade documentation, collusive front entities, and multiple cross-border intermediaries, criminals create intricate financial pathways that deliberately disguise the origin and beneficial ownership of illicit funds under the guise of legitimate trade finance transactions.

Fraudsters orchestrate complex cross-border trade transactions and inter-bank transfers using fabricated or inflated documentation. They add layers of obfuscation to distance illicit proceeds from their criminal origins before final repayment.

Criminals exploit partial or advance payments under red/green clause letters of credit by inflating or fabricating trade documentation. Distributing these funds across multiple jurisdictions and intermediaries introduces significant transactional complexity, explicitly obscuring the illicit origin of proceeds. This serves as a core layering strategy within trade-based laundering schemes.

Documentary collection manipulation is a trade-based money laundering method where falsified shipping documents add transactional complexity, obscuring the true origin and flow of illicit funds.

Criminals exploit fragmented due diligence and limited co-lender visibility in syndicated trade loans to orchestrate complex multi-bank financing arrangements, inflating or fabricating trade documents to conceal the true origin of illicit funds. By spreading transactions across multiple participating banks, they create additional layers to obscure beneficial ownership and transaction values, making proactive auditing and oversight significantly more challenging.

Countertrade involves reciprocal exchanges and repeated commodity shipments across multiple jurisdictions. When coupled with manipulated invoices, it explicitly aims to hide and distance illicit funds from their origin. This multi-transaction approach confuses regulatory oversight and exemplifies layering methods used to obscure audit trails.

By repeatedly altering invoice values and currency exchange rates in cross-border trade transactions, criminals create a convoluted paper trail that intentionally obscures the origin and movement of illicit funds. This complexity is a deliberate layering strategy meant to invalidate straightforward audit checks and hinder investigators from tracing illicit proceeds back to their source.

Funnel accounts systematically move structured deposits across multiple locations or jurisdictions, explicitly creating transactional layers that obscure the origin of illicit proceeds and hinder investigators' ability to trace funds. This aligns directly with layering as the primary strategic objective.

Cross-border policy issuance and subsequent cash-outs add transactional complexity to mask criminal proceeds.

Frequent changes or substitutions of policyholders and beneficiaries create multiple complex ownership layers that hinder transparent tracing of illicit proceeds, serving as a core layering mechanism.

Criminals exploit cross-border reinsurance contracts, inflated premiums, and fabricated claims to create multiple layers of transactions, making it significantly more difficult to trace the original criminal source.

Captive insurance structures enable criminals to move funds in and out through inflated premiums, fabricated claims, and reinsurance arrangements across offshore jurisdictions. This effectively adds transaction complexity to obscure the illicit origin of proceeds.

Criminals repeatedly overfund and then request partial refunds or early surrenders from insurance policies, creating multiple transactions that obscure the funds' criminal origin. Early withdrawal penalties are treated as acceptable costs, explicitly serving the layering objective by distancing illicit proceeds from their source.

By fraudulently reversing previously settled transactions, criminals introduce additional transaction steps that obscure the link to the original illicit funds. The disputed refunds, often routed through various channels and accounts, add complexity that hinders tracing efforts, making layering the primary objective.

Criminals orchestrate repeated or complex trades explicitly to obscure the source of funds, making it harder for investigators to trace illicit proceeds. This layering strategy serves as a secondary objective to further complicate the money trail after the initial placement.

Criminals orchestrate manipulative stock trades and high-volume transactions across multiple accounts or shell entities to obscure the trail of illicit funds, creating a complex chain that detaches the proceeds from their criminal origin.

By executing frequent self-dealing trades among collusive or pseudonymous accounts, wash trading obscures the transaction path and complicates forensic tracing, achieving a clear layering effect of illicit funds.

Paired or offset mirror trading positions repeatedly shift illicit funds across accounts and jurisdictions, embedding them in ostensibly legitimate securities transactions. This deliberate complexity is the hallmark of layering, as it obscures the audit trail and beneficial ownership, distancing the funds from their criminal origin.

Offsetting (wash or matched) trades repeatedly cycle illicit funds through near-simultaneous buy/sell orders in identical volumes, producing minimal net changes in account balances. This complex transaction pattern obscures the traceable link to the original illicit source, exemplifying a classic layering tactic by deliberately fragmenting the money trail and impeding straightforward audits.

By fabricating nonexistent liabilities and associated paperwork, criminals introduce additional transactional steps that mask the flow of illicit funds as ordinary payables. This deliberate complexity obscures the link between the funds' origin and final recipients, exemplifying a layering strategy to evade straightforward detection.

By converting digital or otherwise traceable balances into physical cash—often in structured amounts below reporting thresholds—criminals add a layer of opacity, making it significantly more difficult to trace the illicit funds back to their source.

Criminals convert illicit proceeds into loyalty or reward points and move them across multiple accounts or platforms, making it harder to trace the funds' original source or flow. This explicitly serves as a layering strategy by exploiting minimal AML oversight in loyalty programs to obscure the money trail.

Criminals employ various wagering techniques, such as hedged bets, cross-border online accounts, chip-dumping, or minimal net-loss betting, to increase transactional complexity and obscure the asset trail, thereby distancing funds from their illicit origin.

Chip dumping involves scattering or consolidating illicit funds across multiple players, using collusive betting to obscure the origin and ownership of proceeds. By making the transfers appear as legitimate gambling losses and winnings, criminals create complex transaction patterns that frustrate investigative tracking.

By shuttling funds through VIP junket operators across multiple casinos and jurisdictions, criminals add multiple transactional steps that deliberately blur the audit trail, making it significantly harder to link proceeds back to their illicit origin. This is the primary strategic goal of junket-based casino transfers: complex cross-border movements designed to hinder AML detection.

Unregulated casinos or betting sites introduce additional opaque steps, complicating efforts to trace transaction flows.

Criminals exploit auction environments through tactics such as deposit-refund maneuvers, manipulated bids, and property flipping to create multiple complex transactional steps. These stages obscure the trail back to illicit funds, making auctions a primary venue for layering activities.

Through over- or under-invoicing, multiple re-invoicing, and phantom shipping, criminals execute numerous complex trade transactions specifically to obscure the true source of illicit funds. This reflects the core layering objective of distancing proceeds from their criminal origins.

Criminals repeatedly manipulate invoice values and shipping records across multiple jurisdictions, creating complex cross-border transactions that obscure the audit trail and the origin of funds.

By storing illicit goods alongside legitimate shipments, forging or repeatedly amending shipping documents, and exploiting minimal on-site oversight, bonded warehouses introduce multiple layers of transactional complexity that obscure the true origin and ownership of criminal proceeds.

Criminals introduce intermediary layers through agents or sub-agents to obstruct direct tracing, dispersing transaction records across agent networks and increasing complexity for investigators. By fragmenting the payment chain under multiple licensed or semi-licensed entities, they distance illicit assets from their origin.

Criminals use OTC desks to repeatedly convert and transfer illicit funds into various cryptocurrencies or accounts, explicitly aiming to mask the origin and beneficiaries. The private, minimally regulated nature of many OTC channels adds transactional complexity and frustrates investigators' ability to trace funds.

Repeated cross-currency exchanges serve as the primary strategy to obscure the origin of illicit proceeds by rapidly shifting them between denominations, accounts, and jurisdictions, making the funds more difficult to trace.

Criminals repeatedly convert illicit funds across multiple currencies—whether fiat or crypto—using various platforms to mask their origins. This added complexity is a classic layering tactic, making it harder for investigators to link the funds to their criminal source.

Multi-currency swaps leverage repeated cross-currency conversions to add multiple transactional layers, explicitly obscuring the original source of illicit funds. This complex sequence of exchanges is central to layering, making it substantially more difficult for law enforcement to trace the money trail.

Criminals exploit the on-chain obfuscation inherent in privacy coins to sever direct links between illicit origins and laundered funds, thereby increasing transactional complexity.

Frequent cross-border buying and selling of carbon credits leverages their intangible nature and complex brokerage arrangements to explicitly create multiple transaction layers that obscure the true origin of illicit funds.

By routing illicit proceeds across multiple jurisdictions, criminals create additional layers of transactions that obscure the funds' origin and complicate investigators' ability to trace the money back to its criminal source.

By engaging multiple sub-agents and arranging cross-border handoffs, criminals create multiple transactional layers that obscure the origin of the funds and complicate tracing efforts.

By openly declaring cash at borders and then converting or transferring it abroad under different denominations or using falsified declaration records, criminals introduce multiple layers of transactions to obscure the funds' illicit origin and hinder investigations.

Criminals repeatedly deposit, reallocate, and reinvest illicit funds across multiple cross-border portfolio accounts specifically to obscure their origin. By multiplying transactions through segregated sub-accounts, they create complex money trails that frustrate auditors and regulators, serving as the primary objective of this technique.

By systematically falsifying or manipulating commodity invoices and routing shipments through multiple jurisdictions, criminals create complex transaction trails designed to obscure and distance illicit proceeds from their criminal origins.

Criminals alter or forge financial instruments (e.g., letters of credit, checks) to construct complex or circular transaction chains, explicitly obscuring the origin of illicit funds under layers of falsified documentation and hindering straightforward compliance reviews.

By repeatedly investing or reinvesting illicit proceeds into multiple cryptocurrencies across various exchanges and wallet addresses, criminals introduce complex transaction chains, including chain-peeling, that obscure the original illicit source and hinder law enforcement tracing.

Simulated M&A and incorporation related transactions add financial complexity, making it more difficult to trace funds back to their criminal source.

Simulated M&A transactions add financial complexity, making it more difficult to trace funds back to their criminal source.

By routing funds through lightly regulated payment methods, criminals add transactional complexity that obscures money trails and detaches illicit proceeds from their source, hindering standard investigative tracing.

Criminals exploit P2P channels to engage in numerous small or rapid transfers across multiple user accounts and wallets, deliberately introducing complexity and obscuring the origin of illicit proceeds. The primary objective is to distance the funds from their criminal source through repeated layering steps.

Criminals use frequent, low-value mobile payments—often across borders—to fragment transaction trails, deliberately obscuring any linkage to the original illicit source of funds.

By blending illicit proceeds with legitimate payment flows across merchant accounts and gateways, criminals create transactional complexity that hinders the ability of financial institutions and investigators to trace funds back to their origin.

Through the artificial pricing of inter-company trades, criminals construct complex multi-entity financial flows that fragment and disguise illicit proceeds, making it significantly harder to trace the funds back to their criminal origin. This is the primary strategic objective in using transfer pricing manipulation for money laundering.