Money laundering
Also known as:
- cleaning money
- money washing
- smurfing
- squaring
What is Risk ?
Digital risk factors associated with their interests and activities
Money laundering is a criminal offence. It is used by criminal organisations who are involved in:
- drug dealing
- theft and burglary
- prostitution
- extortion
- trafficking
Criminals launder money because large amounts of cash can be suspicious if it can’t be shown to come from a legal source.
To launder money, someone might:
- deposit small sums of money into bank accounts belonging to other people
- purchase or invest in assets, both physical and digital
- ask a business to declare a sum of money as legitimate earnings
Once cleaned, it’s harder to directly connect money to criminal activity.
Where this can happen
Risks and motivations
Risks
Exploitation
Criminals exploit or coerce children and young people to launder money. They might:
- offer to pay them
- lie about the potential risks
- threaten them with violence
Children and vulnerable individuals might be especially at risk of criminal exploitation. For example, a criminal gang may advertise a form of money laundering like money muling to a young person through social media.
They might ask to deposit money into a child’s bank account. The deposited money is then sent back to the criminals, possibly in return for a small sum.
Breaking the law
Laundering money is illegal even when the person involved is not aware of the criminal activity which has generated the money.
People convicted of money laundering may be given a criminal record, fined, or sent to prison.
Gangs and criminal organisations
Money laundering can lead someone into harmful involvement with gangs and criminal organisations.
They may be exposed to violence or threats of violence. This could be deeply distressing or lead to physical harm. A young person involved in a gang or criminal organisation may also start other illegal behaviours.
Impact on everyday life
Someone convicted of money laundering might be added to a fraud database.
Being added to a fraud database can prevent someone from being able to:
- open a bank account
- take out contracts, for example, phones or utilities
- take out loans, including student loans
- rent a property
- take out a mortgage
Motivations
Reasons a young person might take part in money laundering include:
- being manipulated or coerced
- being threatened
- poverty or wanting to make money
- status and respect
- finding it exciting
- not be aware of risks
Someone may also be motivated to launder money because they have generated cash from other illegal activities.
What you can do
If you are unsure of the legality of someone’s behaviour, you should seek legal advice.
If you think that a young person is at risk, follow your safeguarding procedure and read our safeguarding guidance.
Support
A young person may have had a harmful or negative experience of money laundering, exploitation, or criminal organisations.
The police and other specialist organisations can offer the best advice for helping them recover.
Read more about money laundering
- Children tricked into opening criminal bank accounts (The Children's Society) – Website
- Money mule recruiters use fake online job adverts to target ‘Generation Covid’ (CIFAS) – Website
- Criminal exploitation of children, young people and vulnerable adults (The Home Office) – File
- Parents urged to help stop the rise in child money mules (UK Finance) – Website
Share your experience of money laundering
You can tell us about:
- other terms you might have heard
- conversations you’ve had with young people
- a related platform or app
- another related risk or harm