A predicate offence, also known as a predicate crime, is a crime that serves as a component of a larger crime, such as money laundering, financing of terrorism, or racketeering. It is the foundation or the first crime in the chain of another crime. For example, producing unlawful funds is the primary offence, and money laundering is the predicate offence.
Predicate offences can include a wide range of illegal activities, such as drug trafficking, corruption, fraud, human trafficking, terrorist financing, organized crime activities, cybercrime, and environmental crimes. These offences generate proceeds that are subsequently laundered to make them appear legitimate. Identifying predicate offences provides valuable insights into the nature and scope of criminal activities, enabling law enforcement agencies to anticipate emerging trends, adapt their strategies, and implement preventive measures to mitigate the risks posed by these crimes.
In the context of money laundering, a predicate offence is any crime that generates monetary proceeds, and it is required as an entry condition for money laundering. The term "predicate offence" is usually used to describe money laundering or terrorist financing activities. Predicate offences vary in each country and are usually codified in a country’s criminal code, considering the economy and market of the country. The FATF has provided a list of 21 predicate offences that are criminalized internationally, including terrorism, illicit arms trafficking, and participation in an organized criminal group and racketeering.
Regulatory bodies understand the significance of curbing predicate offences to prevent money laundering and have created legislation to mirror or expand these offences. The punishment for engaging in predicate offences varies depending on the specific crime and the laws of the jurisdiction in which it is committed.
