Money laundering is a term used to describe the process whereby cash generated in illegal activities is converted to an alternative form in a manner that conceals its origin, ownership, or other potentially embarrassing factors. In India, one money- laundering device used by criminals is the taking over of deteriorating industrial enterprises for the apparent purpose of rehabilitating them for profit. In the process, criminals have access to legal sources of funds not only from the financial institutions that are part of the package but also profits derived after laundering; exaggerated profits are reported to legitimize the money from illegal activities. A similar process occurs with another money-laundering device: the construction of hotels and cinema theaters. A third device involves construction projects, in which large amounts of cash are required for the purchasing of raw materials, inputs, construction equipment, and wages. This provides opportunities for the manipulation of accounts to maximize profits that involve legitimizing money from illegal enterprises. Other money laundering devices are the creation of charitable trusts, the organizing of fund-raising functions, and the creation of investment companies. This paper also describes various international money-laundering schemes, such as transfers through the havala system, the under-invoicing of exports and over-invoicing of imports, and the non-repatriation of export proceeds.