Abstract: Money Laundering is an International issue since from the beginning of its evolution. This is a threat to the world economy, because of the fact that the black money is being used for the Terrorist financing and several other illegal activities by various sources of money laundering activities. Such activities are not only impairing the world financial health, but also a threat to the human kind. In order to curb the money laundering the steps taken by India and the principles adopted by United States; should be acknowledged by the world to combat money laundering and terrorist financing.