My understanding of money laundering is the baddies have huge truck loads of untaxed dirty cash and they need to somehow legitimize it to get it into the bank. E.g. from Breaking Bad: drug money → car wash with phony sales → bank. Once it’s in the bank, it’s on the radar.
The linked article says that withdrawing cash is a money laundering red flag. Can someone please explain why that is? AFAIK, if the money is in the bank it must already be clean (or appear so), no?
Cash is anonymous and because of it not having a verifiable origin, cash is treated as suspect. The irony of laws to prevent money laundering is that they basically only frustrates normal people, while criminals have access to lawyers and bankers that will help them successfully launder money.
Not sure it’s accurate to say cash is anonymous considering the practical matter of having to be present in person to spend it and collect a receipt if needed. Lack of traceability is certainly a factor, which is both a feature and a bug depending on whether the tracing is warranted.
But indeed I agree that the non-criminal masses are suffering collateral damage in this hunt for relatively few criminals who can be caught in other ways.