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Say that we trust each other, I am visiting you, and I wire you a sum X in the currency of my home country, and you give me a sum Y in the currency of your home country, without any intermediaries.

Are there laws and regulations about the amount of money which can be transferred between countries this way, and where can I read about them?

I assume that services such as https://transferencias.global66.com or the banks take commissions on such transfer, which are justified as they take in charge the risk and trust factors, and that such commissions could be skipped when the two persons involved in the exchange trust each other, but I wonder if there are legal restrictions on such exchanges (and on the amounts being transferred).

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  • In some countries it is illegal to trade currencies outside of authorised offices/banks/etc.
    – JoErNanO ♦
    Commented Sep 30, 2022 at 11:01
  • Even in countries without strict currency controls, anti-money laundering/fraud/terrorism financing measures may still apply. Doing this on one-off basis with families and trusted friends is unlikely to attract scrutiny. Doing it regularly, particularly if cash or transfer without clear source and explanation is involved, can lead to messy situations.
    – xngtng
    Commented Sep 30, 2022 at 11:27
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    It also depends on amounts. Nobody will worry about $US 100 but $US 10000 is often not seen as innocent.
    – Willeke ♦
    Commented Sep 30, 2022 at 11:35
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    Which countries specifically?
    – Traveller
    Commented Sep 30, 2022 at 11:56
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    @J..yB..y Banks are obliged to monitor all transactions and report any transaction that they have reasonable grounds for considering suspicious (see eg laws-lois.justice.gc.ca/eng/acts/P-24.501/page-1.html#h-398214 for Canada). All banks will have sophisticated transaction monitoring processes, which would include various flags eg amount, frequency, source. A wire transfer of even a relatively low amount eg $100 could well be flagged. Tipping off is an offence, so your friend wouldn’t be informed if a report were to be made
    – Traveller
    Commented Oct 2, 2022 at 11:36

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Legal problems in this (outside trust factors) usually come from two sources:

  1. Some countries (e.g. China, Iran, Argentina) impose general currency exchange measures for economic and political reasons. Any exchanges not at official locations may be technically in violation of law. The enforcement varies in different countries (even in different regions e.g. of China). Although private exchanges are common place in almost all these countries and to some extent tolerated, legal risks still exist. Of course, small amounts are usually less likely to be a problem than larger amounts.
  2. Almost all advanced economies nowadays have anti-money laundering/fraud/terrorism financing measures in place. The exact regulations differ in each jurisdictions.
    • In general, if physical cash (or other "untraceable" instruments) is involved, most countries have a threshold (often around US$10,000) above which a report must be made to government authorities who may investigate the source of funds and the purpose of transaction. Even if electronic transfer is used, financial institutions are required to report any suspicious transactions. Suspicion can arise from large values or large numbers of transactions between accounts without clear business purposes.
    • You can unknowingly become a "money mule" (participants in money laundering rings) and subject to criminal investigations and liability. Some countries have laws such as civil forfeiture and investigative asset freezing measures. Your entire assets may be inaccessible during a long investigation and a significant amount may be even seized.
    • if you do currency exchanges regularly with indeterminate individuals, even without making a profit, you may be required to register as a money service business and subject to related banking regulations (e.g. in the UK).

Of course, despite these risks, private money exchanges can be commonplace. A small amount between families and friends, who have clear traceable origin of their funds, is unlikely to be a problem. But doing so regularly or for large amounts exposes you to legal risks; for example, (UK) crime agency freezes foreign students’ bank accounts (for unsourced funds that may be gains from criminal activities).

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Are there laws and regulations about the amount of money which can be transferred between countries this way,

Yes, of course.

and where can I read about them?

The internet is good starting point.

Currently there 180 different currencies which results in 32220 different combinations of currency exchange. There is no single law that governs all of this and the rules are vary greatly. You need to research he specific combination you are interested in.

The best way to get local currency varies enormously from country to country. For example if you walk down Calle Florida in Buenos Aires, Argentina, many people will yell "Cambio, Cambio" at you. They will exchange US$ to Argentinian Pesos for just about double the official rate or what you would get at a bank. This happens to be perfectly legal in Argentina, but will easily get you arrested in other countries. There is no single set of rules.

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    Can you back up the claim that black market money changes in BA are legal?
    – Peter M
    Commented Sep 30, 2022 at 14:02
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    It's not black market at all. there simply is no law against it. It's just a private transaction between consenting partners. You can actually get the "Blue Rate" if you transfer dollars through Western Union. On Calle Florida the cops and the money changers are happily chatting with each other. I got 25% off my hotel bill since I paid with credit card at the official exchange rate, a discount that (I think) was instantiated by the major. Argentinians are limited on how much $ they can buy from a bank, but they are not limited on how much they can buy from you.
    – Hilmar
    Commented Sep 30, 2022 at 17:00
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You might want to look into Hawala money transfer "money transfer without money movement" operates (apparently common in the MENA, especially in Dubai):

Investopedia claims:

Is a Hawala Illegal? Hawala trades are illegal in the United States and many other countries because financial regulations require money services businesses to obtain appropriate licenses and follow anti-money laundering laws.

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