In brief. Money laundering is the criminal process by which proceeds derived from a predicate offence are concealed, transferred or converted so that their illicit origin is no longer traceable. Under Italian law it is punished by Article 648-bis of the Criminal Code with imprisonment from four to twelve years and a fine; at EU level it is governed by Directive (EU) 2018/1673 and the 2024 Anti-Money Laundering package (Regulation (EU) 2024/1624, Directive (EU) 2024/1640, AMLA Regulation (EU) 2024/1620), with the single rulebook applying from 10 July 2027.

In short

  • Money laundering means transforming proceeds of crime to make them appear legitimate.
  • In Italy it is punished by art. 648-bis Italian Criminal Code (four to twelve years’ imprisonment).
  • A predicate offence (the underlying crime that generated the proceeds) is required.
  • Self-laundering (laundering one’s own proceeds) is a separate offence: art. 648-ter.1 Italian Criminal Code.
  • The compliance side is regulated by Legislative Decree 231/2007 (Italian AML transposition).

Definition: what does money laundering mean

Money laundering is the conduct of any person who — outside the cases of complicity in the predicate crime — substitutes, transfers or otherwise carries out operations on money, goods or other utilities deriving from an offence (delitto, including, since Legislative Decree 195/2021, negligent offences and contraventions punished with arrest exceeding one year at the maximum or six months at the minimum), in such a way as to hinder the identification of their criminal origin. The conduct can be one-shot or repeated, financial or non-financial, and may take place across multiple jurisdictions: this is why money laundering is by nature a cross-border crime.

  • Article 648-bis of the Italian Criminal Code — money laundering, imprisonment from 4 to 12 years and fine from EUR 5,000 to EUR 25,000 (2 to 6 years and EUR 2,500 to EUR 12,500 where the proceeds derive from a contravention)
  • Article 648-ter Italian Criminal Code — use of money, goods or utilities of unlawful origin
  • Article 648-ter.1 Italian Criminal Code — self-laundering (autoriciclaggio), introduced by Law 186/2014
  • Legislative Decree 231/2007 — Italian transposition of EU AML directives; obligations for financial intermediaries, professionals, gatekeepers
  • Legislative Decree 231/2001 — administrative liability of legal entities for predicate offences including laundering
  • Directive (EU) 2018/1673 — criminal definition of money laundering at EU level
  • Regulation (EU) 2024/1624 + Directive (EU) 2024/1640 + Regulation (EU) 2024/1620 (AMLA) — the 2024 AML package; the single rulebook applies from 10 July 2027, AMLA (Frankfurt) operational since 1 July 2025, with direct supervision of selected obliged entities from 2028

How the three phases of money laundering work

Money laundering is classically broken down into three operational phases, useful both for investigators and for compliance officers building risk models.

Placement is the physical introduction of cash into the financial system: deposits below reporting thresholds (smurfing), exchange into foreign currency, prepaid cards, money transfer chains, cash-intensive businesses. This is the riskiest phase for the launderer because it is where the proceeds are still in their most evident form.

Layering consists of a sequence of operations whose only purpose is to obscure the audit trail: wire transfers across multiple jurisdictions, conversion into shell-company invoices, purchase and resale of high-value assets (art, jewellery, real estate), use of trusts and nominee structures, conversion into crypto-assets and back to fiat. The more complex the layering, the harder the forensic reconstruction.

Integration is the re-entry of the funds into the legal economy with apparent justification: a loan from a related party, a consultancy fee paid through a foreign company, a real-estate sale at inflated price. At this stage the money is formally clean and the criminal organisation can use it without raising obvious red flags.

The predicate offence requirement

Italian and EU criminal law require a predicate offence: laundering presupposes that the proceeds come from another crime (fraud, drug trafficking, corruption, tax crimes, trafficking in human beings, etc.). The catalogue of predicate offences is open: since Legislative Decree 195/2021 (in force from 15 December 2021) any delitto, including negligent ones, and contraventions punished with arrest exceeding one year at the maximum or six months at the minimum can act as the predicate. The prosecutor must prove the predicate offence at least in its objective elements; it is not necessary that the perpetrator of the predicate offence has been convicted.

At EU level, the minimum list of predicate offences was harmonised by Directive (EU) 2018/1673, transposed in Italy by Legislative Decree 195/2021. The 2024 EU package (in particular Regulation (EU) 2024/1624) introduces a single rulebook for obliged entities across the Union, applicable from 10 July 2027.

Money laundering vs self-laundering: the difference

Until 2014 a person who laundered the proceeds of their own crime could not be prosecuted for money laundering: art. 648-bis applies “outside the cases of complicity in the offence”. Law 186/2014 introduced art. 648-ter.1, which punishes precisely the person who has committed the predicate crime and then employs, substitutes or transfers the proceeds in economic, financial, entrepreneurial or speculative activities, so as to concretely hinder the identification of their criminal origin. The penalty ranges from two to eight years’ imprisonment and a fine from EUR 5,000 to EUR 25,000; it is one to four years and a fine from EUR 2,500 to EUR 12,500 where the proceeds derive from a contravention, and it is reduced where the predicate offence carries a maximum penalty below five years.

Corporate criminal liability for laundering

Money laundering, self-laundering and use of illicit proceeds are predicate offences under Legislative Decree 231/2001: the legal entity itself can be sanctioned — administratively but with criminal-law mechanics — when the offence is committed in its interest or to its advantage by individuals in a top or subordinate position. Sanctions include monetary fines, disqualification, publication of the judgment and, in the worst cases, prohibition from contracting with public administration. A compliant Organisation, Management and Control Model (Model 231) with effective AML procedures is the key defence.

Case examples

(Illustrative examples of typical situations: they do not refer to specific proceedings or to clients of the firm.)

Case 1 — Cross-border layering via shell companies. A criminal group active in VAT-fraud carousels routes proceeds through a chain of UK LLPs and Cypriot companies, then converts the funds into luxury real estate in Italy. The Italian prosecutor charges both art. 648-bis (against the off-shore intermediary) and art. 648-ter.1 (against the original fraudsters who reinvest into Italian real estate). The 231 liability of the Italian buyer-entity is investigated in parallel.

Case 2 — Crypto layering. A third party, not involved in an online investment scam, converts its proceeds into Bitcoin via non-KYC exchanges, then through mixing services, and finally cashes out into a SEPA bank account. A suspicious transaction report on the inbound transfer reaches the Italian Financial Intelligence Unit (UIF); the resulting investigation reconstructs the flow and may charge art. 648-bis, with the aggravating circumstance applying if the conduct was carried out in the exercise of a professional activity. If the scammers themselves had laundered the funds, the charge would instead be self-laundering (art. 648-ter.1).

FAQ

What is the basic meaning of money laundering? Money laundering is the act of disguising the criminal origin of money or assets so they appear lawful, through placement, layering and integration in the legal economy.

Which law punishes money laundering in Italy? Article 648-bis of the Italian Criminal Code, with imprisonment from four to twelve years and a fine. Self-laundering is punished separately by article 648-ter.1.

What is a predicate offence? It is the underlying crime (fraud, corruption, tax evasion, drug trafficking, etc.) that generated the proceeds being laundered. Without a predicate offence there is no laundering.

Can a company be prosecuted for money laundering? Yes. Under Legislative Decree 231/2001 the legal entity itself can be sanctioned if the offence is committed in its interest. An effective Model 231 with AML procedures is the main defence.

How does the 2024 EU AML package change the rules? The 2024 package introduces a single EU rulebook, a new AML Authority (AMLA, based in Frankfurt and operational since 1 July 2025) and a directly applicable regulation for obliged entities — applicable from 10 July 2027 — replacing the previous directive-based regime for most preventive obligations. AMLA will directly supervise selected high-risk obliged entities from 2028.

About ILA

International Lawyers Associates is an international criminal law firm with offices in Naples, Milan and Rome. The firm assists individuals and legal entities in cross-border investigations, AML compliance, extradition and judicial cooperation. Direction: Avv. Alexandro Tirelli.