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Money Laundering

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what does it mean when some people in the news get done for the crime of Money laundering? and how is Money laundering involved with prostitution?

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what does it mean when some people in the news get done for the crime of Money laundering? and how is Money laundering involved with prostitution?

Try this:

http://en.wikipedia.org/wiki/Money_laundering

It's a technique used by some people/ organisations to make the proceeds of activities like prostitution (which is illegal in some countries) appear to have been earned by legal means. It can also make the tracking of money by regulatory authorities (e.g. the tax and criminal justice systems) more difficult.

If you wish to have a go yourself, I would recommend more reading though.

;)

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so you blaga a bank and end up with a sack full of tenners.

you need to get it into an ISA but if u turn up at the bank with a bag of tenners they have to ask awkward questions.

so you invest the tenners in a legitimate business, then your return is legitiimte and the bank will be happy.

some forms of prostitution is illegal, like running a brothel. So getting your profits into your ISA may prove difficult without a legit business alongside.

What I wonder is how indies cope with their income being in cash. Turning up at the bank with cash a few times a week must raise eyebrows, unless they pay for everything with credit cards and pay them off with the cash.

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DO NOT PUT MONEY IN YOUR WASHING MACHINE!

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what does it mean when some people in the news get done for the crime of Money laundering? and how is Money laundering involved with prostitution?

For example, it's illegal to keep or manage a brothel and any money earned is treated as the proceeds of crime and by spending, investing, retaining the money the brothel keeper is involved in money laundering. If the proceeds are spent on houses, cars etc. or invested then the assets/money are potentially recoverable under the relevant provisions of the Proceeds of Crime Act 2002 (as amended).

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you need to get it into an ISA but if u turn up at the bank with a bag of tenners they have to ask awkward questions.

What I wonder is how indies cope with their income being in cash. Turning up at the bank with cash a few times a week must raise eyebrows, unless they pay for everything with credit cards and pay them off with the cash.

I have a business account. Money from "clothed" contracts goes in via BACS, money from escorting goes in Cash.

The biggest issue is banking hours.

I rarely pay in more than a grand, never pay in £3000 in cash, so no notifiable amounts, nor amounts the Police could question if they stopped me outside.

Yes, I do pay my PAYE!

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what does it mean when some people in the news get done for the crime of Money laundering? and how is Money laundering involved with prostitution?

Think a moment!

Ms X is an independant whore - she collects her "tributes" in cash - used £20s - and she is 100% legal (always assuming that she does her self assessment return).

Mr Z deals in counterfeit DVDs, and similar kit. He, also, collects lots of used notes.

Now whereas Mr Z's money is the proceeds of crime, and potentially liable to be seized as such, Ms X's cash is straight, and she can pay it in without the slightest risk, but, of course, there is no till roll in her case, no invoices, no delivery notes signed by the customer.

So, if Mr Z and Ms X were to make an arrangement, whereby he gave her, every now and then, a Tesco "Bag for Life" stuffed wi' used tenners, she could bank that together with her own takings, pay tax on it as if it were her own, and, if she and Mr X were an "item" she could simply pay their mortgage out of it. Otherwise they'll have to dream up some transaction whereby she pays Mr X for some service he (nominally) renders her.

I learned a while ago that a winning Tote Ticket from the race course, is, itself valuable! The lucky punter, paid in cash on sight, on simple production of his ticket, can have the ticket, stamped "PAID" back as a "souvenir". This can be very useful to a stranger to show that a pile of used money in his freezer is clean!

The "cut" that a man with serious amounts of dirty money needs to pay to get it cleaned is quite substantial, I gather.

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so you blaga a bank and end up with a sack full of tenners.

you need to get it into an ISA but if u turn up at the bank with a bag of tenners they have to ask awkward questions.

so you invest the tenners in a legitimate business, then your return is legitiimte and the bank will be happy.

some forms of prostitution is illegal, like running a brothel. So getting your profits into your ISA may prove difficult without a legit business alongside.

What I wonder is how indies cope with their income being in cash. Turning up at the bank with cash a few times a week must raise eyebrows, unless they pay for everything with credit cards and pay them off with the cash.

My bank has no problem with me paying in cash several times a week, why should they?they are a bank after all and probably quite happy to have my custom. I also find it has it's advantages, not many people can say they have regular contact with bank staff who are familiar with them these days.

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I have a business account. Money from "clothed" contracts goes in via BACS, money from escorting goes in Cash.

The biggest issue is banking hours.

I rarely pay in more than a grand, never pay in £3000 in cash, so no notifiable amounts, nor amounts the Police could question if they stopped me outside.

Yes, I do pay my PAYE!

PAYE is for employees, not the self-employed who pay via self assessment which is usually paid in installments, or at least once every 6 months - rather than at point of earning (which is how PAYE system operates).

Edited by Strawberry

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PAYE is for employees, not the self-employed who pay via self assessment which is usually paid in installments, or at least once every 6 months - rather than at point of earning (which is how PAYE system operates).

I am employed by my limited company. I pay myself a wage & pay PAYE on that. My Company organises my Health Insurance, Gym Membership and funds my education as a benefit.

Also, if I decide to start a family, Maternity Pay is easier to manage for an employee than for a Self-Employed person.

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I am employed by my limited company. I pay myself a wage & pay PAYE on that. My Company organises my Health Insurance, Gym Membership and funds my education as a benefit.

Also, if I decide to start a family, Maternity Pay is easier to manage for an employee than for a Self-Employed person.

That's ok, I was just clarifying before anyone else came along and got picky. I know a few people who pay themselves via their own limited companies, does have a few benefits it appears.

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That's ok, I was just clarifying before anyone else came along and got picky. I know a few people who pay themselves via their own limited companies, does have a few benefits it appears.

yes but be careful of the IR35 rules that say you have to have multiple clients, and not be controlled by the clinet, i.e the hours of work, or the method you do your work, and you use your own equipment to do the work.

Lara sounds OK unless she only does outcalls to one client, but less clear cut in my line in IT

problem is you cant get a sign off from HMRC to say you're IR35 compliant. they can say you are OK for last tax year, then as case law is made later they can revisit your accounts and then come back for the tax they reckon is unpaid.

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Escorting isn't the only thing I do. I've got a lot of other things going on.

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I am employed by my limited company. I pay myself a wage & pay PAYE on that. My Company organises my Health Insurance, Gym Membership and funds my education as a benefit.

I'd hate to be sat opposite an HMRC inspector being asked to justify this scenario; us ordinary citizens do not seem to get the same indulgence as people employed in central and local government.

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What I wonder is how indies cope with their income being in cash. Turning up at the bank with cash a few times a week must raise eyebrows, unless they pay for everything with credit cards and pay them off with the cash.

Paying cash into a bank account isn't illegal - I go virtually every day if I'm working and have paid in anything up to £3000 in one go. I was asked once where the money was from when I turned up with £1900 at a branch other than my local one when I was working in London, I told them it was my earnings and the cashier apologised immediately and told me she had been instructed to ask about any amount over £1000. I got paid cash (with a payslip, in a little brown envelope) at my last civvy job too and nobody ever questioned me paying that in on a Friday afternoon. The only time I get looks is when I've been in the Channel Islands or the Isle of Man and brought the last days' earnings back, because the banknotes don't fit in the counting machine so they have to do it by hand :D.

Of course if somebody doesn't register as self employed and declare their income I would think they've got very good reason to worry what the bank think, but what the freeloading parasites do with their money is no concern of mine, and the sooner they get caught out the better (and I'm not just talking about prostitutes).

Edited by AdorableAmy

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I'd hate to be sat opposite an HMRC inspector being asked to justify this scenario; us ordinary citizens do not seem to get the same indulgence as people employed in central and local government.

My company does other work, and I occassionally need to employ other people. We pay taxes on our benefits.

Don't hate the Player... Hate the game!

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Using a shop, cafe or club or anything involving high cash turnover, can help facilitate the laundering of dirty money by obfuscating its origins.

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I rarely pay in more than a grand, never pay in £3000 in cash, so no notifiable amounts, nor amounts the Police could question if they stopped me outside.

There are no notifiable amounts. It's entirely up to the bank whether they refuse to accept the cash or decide to report it. There's no "de minimis" disclosure limit apart from the current minimum threshold amount of £250 under section 339A POCA.

If the police have reasonable grounds of suspicion that the cash constitutes criminal property then they can seize it. The current minimum amount that they can seize is £1,000 - The Proceeds of Crime Act 2002 (Recovery of Cash in Summary Proceedings: Minimum Amount) Order 2006.

Even if the amount is less than £1,000 then they can still arrest and seize as evidence under PACE 1984.

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I'd hate to be sat opposite an HMRC inspector being asked to justify this scenario; us ordinary citizens do not seem to get the same indulgence as people employed in central and local government.

Strange comment - 99.9% or more of people employed in central and local government are on salaries fully taxed at source under PAYE.

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My bank has no problem with me paying in cash several times a week, why should they?they are a bank after all and probably quite happy to have my custom.

It depends how much money you are paying in, up to £2000 might not be a problem, if you turn up with £10,000 they will probably start to ask questions, if they don't believe the answers they could report you to head office where they will have a money laundering department, this could lead to all sorts of problems.

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It depends how much money you are paying in, up to £2000 might not be a problem, if you turn up with £10,000 they will probably start to ask questions, if they don't believe the answers they could report you to head office where they will have a money laundering department, this could lead to all sorts of problems.

Yes this is correct I am aware of the money laundering stuff regards turning up with large sums. Fortunately I don't accumulate such amounts, no need to when it's easy to pop into the bank daily.

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Yes this is correct I am aware of the money laundering stuff regards turning up with large sums. Fortunately I don't accumulate such amounts, no need to when it's easy to pop into the bank daily.

besides I bet you pay for stuff like the supermarket etc with cash. Unlike me where i pay everything with a johnlewis partnership card to get the points (free shoppng at waitrose) and do an internet transfer when i get home. Its just a different mindset.

or praps not, Ruth. You seem to have everthing workout so it works for you :)

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Using a shop, cafe or club or anything involving high cash turnover, can help facilitate the laundering of dirty money by obfuscating its origins.

Yeees! And, assuming that we aren't laundering a couple of quid a week, passing it through the till probably lets the VAT man in for his share! The trouble here is that IF the authorities get suspicious, they'll expect to be shewn the till rolls, and then, probably, the invoices for supplies/stock bought in.

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My company does other work, and I occassionally need to employ other people. We pay taxes on our benefits.

Don't hate the Player... Hate the game!

Don't get me wrong, it sounds like you have it very well organised; it's just that I know from bitter experience that when you are sat down with an HMRC Inspector randomly pulling out Invoices and asking you to justify them it is very intimidating. After nearly two decades in business I still make expensive mistakes.

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Strange comment - 99.9% or more of people employed in central and local government are on salaries fully taxed at source under PAYE.

The vast majority will be, for sure, but I recently listened to this Podcast:

http://www.bbc.co.uk/podcasts/series/fileon4

Many examples in there of Local Government executives having their remuneration channelled through a Limited Company (avoiding Employers and Employees National Insurance)/

There was also the recent revelation that the head of the Student Loans Company was being similarly compensated:

http://www.independent.co.uk/news/uk/home-news/outcry-at-student-loan-bosss-tax-dodge-6298198.html

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