It is the process of taking the money gained from criminal activities and making them appear legal.

..like setting up a non -business
and pretending that money is coming legitimately
via customers....betting /casinos.....
where you would not need to purchase much stock
...then bank it without questions.
Drug dealers and criminals tend not to bank
the money...instead convert it ino possessions
like gold items and luxury cars.

Al Capone had a furniture business as a front for his racketeering and alcohol operations. He would create fake invoices to make the cash appear to be legal sales, thereby "laundering" the money and making it clean.