Russian Laundromat
Okay kiddo, imagine a group of bad guys in Russia, let's call them the "mafia". These bad guys have a lot of money that they earned illegally by doing bad things like selling drugs or stealing. But they can't use this money openly because the police will come and arrest them.
So, these bad guys come up with a plan, they set up fake companies in different countries, like the United States, and they pretend to do real business. For example, they might say that they sell bananas, but they really don't sell anything at all. They make fake invoices (which are like receipts for money) that show they are buying bananas from one company in Russia and selling them to another company in the USA. But in reality, it's all fake.
So when they get money from their illegal activities, they send it to one of these fake companies. This fake company then sends the same amount of money to another fake company, and so on, until the money ends up in a real company's account. This is why it's called a "laundromat" because the money goes through many layers of fake companies, like clothes go through a washing machine with many layers of soap.
Eventually, the bad guys can use this money to buy things like fancy cars or houses. But they can say that they got the money from these fake companies, which look legitimate on paper. It's like you telling your teacher that you did your homework, but really you just copied someone else's answers.
This "Russian laundromat" scheme is a very clever way for bad guys to hide their illegal money and make it look like they earned it legally. But it's also very dangerous because it can be used to fund other bad things, like terrorism. That's why the police are always trying to stop these bad guys from doing it.
So, these bad guys come up with a plan, they set up fake companies in different countries, like the United States, and they pretend to do real business. For example, they might say that they sell bananas, but they really don't sell anything at all. They make fake invoices (which are like receipts for money) that show they are buying bananas from one company in Russia and selling them to another company in the USA. But in reality, it's all fake.
So when they get money from their illegal activities, they send it to one of these fake companies. This fake company then sends the same amount of money to another fake company, and so on, until the money ends up in a real company's account. This is why it's called a "laundromat" because the money goes through many layers of fake companies, like clothes go through a washing machine with many layers of soap.
Eventually, the bad guys can use this money to buy things like fancy cars or houses. But they can say that they got the money from these fake companies, which look legitimate on paper. It's like you telling your teacher that you did your homework, but really you just copied someone else's answers.
This "Russian laundromat" scheme is a very clever way for bad guys to hide their illegal money and make it look like they earned it legally. But it's also very dangerous because it can be used to fund other bad things, like terrorism. That's why the police are always trying to stop these bad guys from doing it.