Which sequence correctly lists the three stages of money laundering?

Which sequence correctly lists the three stages of money laundering?

• A. Introduction, Processing, Reinvestment
• B. Layering, Integration, Realization
• C. Placement, Concealment, Distribution
• D. Placement, Layering, Integration

Answer: (D)

Money laundering follows a progression from getting illicit funds into the system, to obscuring their origin, to reintegrating them as if they were legitimate. The first stage, placement, involves introducing the money into the financial system—think deposits, cash businesses, or transfers that establish a foothold. The second stage, layering, uses a web of transactions to hide where the money came from—moving funds between accounts, across borders, buying and selling assets to confuse the trail. The final stage, integration, makes the funds appear legitimate again—investments, loans, or business activities that let the money blend back into the economy without obvious red flags. This sequence—placement, layering, integration—best captures how money launderers typically operate. Other options mix in nonstandard terms or alter the order, which doesn’t reflect the conventional flow from entry to concealment to reintegration.

Money laundering follows a progression from getting illicit funds into the system, to obscuring their origin, to reintegrating them as if they were legitimate. The first stage, placement, involves introducing the money into the financial system—think deposits, cash businesses, or transfers that establish a foothold. The second stage, layering, uses a web of transactions to hide where the money came from—moving funds between accounts, across borders, buying and selling assets to confuse the trail. The final stage, integration, makes the funds appear legitimate again—investments, loans, or business activities that let the money blend back into the economy without obvious red flags. This sequence—placement, layering, integration—best captures how money launderers typically operate. Other options mix in nonstandard terms or alter the order, which doesn’t reflect the conventional flow from entry to concealment to reintegration.