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61 I L T A N E T . O R G E ven though the phrase "money laundering" was not coined until the early 20th century, the act of concealing income derived from illicit activities can be traced as far back as 2000 B.C. At that time, Chinese merchants cycled money through numerous businesses and complex financial transactions to hide their income from the government. 1,2 Historians often mark the early 1900s as a prominent period for the progression of money laundering, the practice of obtaining cash gained through criminal means appear as if it came from legitimate business activities. 3 The origin of the expression for the practice of money laundering comes from the Prohibition era, when the infamous Al Capone opened laundromats around Chicago to "wash" large amounts of cash. Today, various types of businesses — from small family shops to large institutions — risk falling prey to money laundering criminals. The repercussions of money laundering are not only damaging to the business involved, but it can have serious economic, security, and social consequences for society at large. 4 Therefore, business owners are accountable for implementing and following processes that pledge compliance with all local and federal regulations, which can vary depending on where the business operates, and in which industry. The risk of financial crime in law firms Over the past few decades, financial crimes have increasingly become a top concern of government officials around the world. These crimes include fraud, cyber- crime, money laundering, terrorist financing, bribery, corruption, market abuse, and insider dealing, and they have become a multitrillion-dollar industry for criminal organizations. As to money laundering specifically, the United Nations Office on Drugs and Crime estimates between $800 billion and $2 trillion — or 2% to 5% of global gross domestic product — is washed annually. 5 While money laundering is not a new type of financial crime, it has significantly evolved with the advancement of technology and the globalization of the economy. It's been able to become more prevalent because of the inconsistent ways that inspections and regulations are carried out and the lack of coordination among regulators.1 Since the early pioneering days of Capone and other gangsters, the approach to money laundering has gradually become more sophisticated. According to the International Bar Association's Anti-Money Laundering Forum, this shift is due to a few reasons: 1 • Globalization of the financial system: Concealing crime and its proceeds became easier when communications and travel between countries became easier. Wiring money from one institution to another can occur instantly. • Globalization of crime: Law enforcement is tasked with a practically impossible responsibility: to look beyond their jurisdiction, coordinate with other jurisdictions, and anticipate wrongdoing that can occur at a rapid speed. • Boundary-less crimes: Criminals and crime organizations benefit when they are willing to part with their money across boundaries, by taking advantage of laxer rules in other countries and safe havens for concealing wealth. Some countries, in fact, become "dead ends" when investigators go after money trails. While a probability of risk always exists whenever money is exchanged, certain industries and types of businesses face a higher chance of getting targeted by

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