However, it also arises from illegal arms trafficking, organised crime, blackmail, credit card and other financial fraud. Globalisation of the world economy, while acknowledged as bringing clear benefits to the world's population, also comes with acknowledged risks, causing weaknesses and vulnerabilities in both national and international financial systems. Money laundering is now considered not only a threat to the national security of individual nations but is seriously considered to be a threat to international security. Money laundering is the process by which criminals attempts to conceal the true origin and ownership of the proceeds of criminal activities. If undertaken successfully, it allows them to maintain control over those proceeds and to provide a legitimate cover for their source of income.
Money laundering is a global phenomenon that affects all countries to varying degrees.
Failure to prevent the laundering of the proceeds of crime permits criminals to benefit from their actions, thus making crime a more attractive proposition. This cannot be tolerated. The ability to launder the proceeds of criminal activity through financial systems is vital to the success of criminal operations. The unchecked use of financial systems for money laundering purposes has the potential to undermine individual financial institutions and, ultimately, the entire financial sector. The increased integration of the world's financial system, and the removal of barriers to the free movement of capital, have both enhanced the ease with which criminal money can be laundered and complicated the tracing process.