What is smurfing in money laundering?

Smurfing is a popular method used by money launderers to conceal their illegal proceeds and evade detection by law enforcement agencies. In smurfing, illicit funds are broken down into smaller amounts and deposited into multiple accounts in different locations. This technique is also known as structuring.

The term "smurfing" derives from the blue cartoon characters known as Smurfs, who live in small, tightly-knit communities and work together for a common goal.

Smurfing is used to bypass the reporting requirements of financial institutions, which are required to report any deposits that exceed a certain amount to regulatory authorities. By breaking up large amounts into smaller sums, money launderers can avoid raising red flags and pass under the radar of authorities.

Smurfing also makes it difficult for authorities to trace the origin of the funds because the money is distributed among numerous accounts and often moved around between different banks and financial institutions.

In recent years, financial institutions have implemented stricter regulations and internal controls to prevent money laundering and other financial crimes. However, launderers continue to find creative ways to evade detection, and smurfing remains a prevalent method used by criminals to launder money.