Rhoda Weeks-Brown — Cleaning Up: Countries are advancing efforts to stop criminals from laundering their trillions

Foreign real estate is a favorite vehicle.

You probably know that Al Capone was prosecuted on tax evasion, but did you know the details?

Al Capone had a problem: he needed a way to disguise the enormous amounts of cash generated by his criminal empire as legitimate income. His solution was to buy all-cash laundromats, mix dirty money in with clean, and then claim that washing ordinary Americans’ shirts and socks, rather than gambling and bootlegging, was the source of his riches.

Almost a century later, the basic concept of money laundering is the same, but its scale and complexity have grown considerably. Were Capone alive today, he would have to run his washers and dryers around the clock to keep pace with demand; the United Nations recently estimated that the criminal proceeds laundered annually amount to between 2 and 5 percent of global GDP, or $1.6 to $4 trillion a year....

IMF
Cleaning Up — Countries are advancing efforts to stop criminals from laundering their trillions
Rhoda Weeks-Brown | general counsel and director of the Legal Department of the IMF

John Helmer — PRIVATE BLIND EYE – HOW THE LAST BRITISH INVESTIGATIVE JOURNALIST TURNS ONE ON RUSSIA

What Private Eye has failed to investigate is how Chernukhin has been able to import and invest a fortune in the UK, with the imprimatur of the British Government, financial regulators, and banks – a fortune whose origin when he was a state official in Moscow Chernukhin declines to explain....

On the say-so of Kasyanov and Kudrin, Chernukhin supervised VEB’s takeover of most Russian pension fund contributions; management of Soviet-era debts owed to Moscow by states like Czechoslovakia and Vietnam; and bail-out loans for companies designated by Kasyanov, Kudrin, or Putin as politically valuable; these included state media companies. When Kasyanov began to threaten Putin with political competition, he was dismissed from the prime ministry in 2004. At the same time Chernukhin was fired from the chairmanship of VEB. He then moved to London.

The High Court papers and media reports indicate that he took with him and then spent at least £150 million acquiring personal and commercial assets. As he did that, Chernukhin was sheltered by the British Government which granted him British citizenship. In 2006 Moscow reporters were asking in print where Chernukhin’s money had come from. “Why”, wrote Semyon Goncharov of KM.ru, “don’t the British authorities ask the Russian oligarchs the question: where, thanks to what, and at the expense of whom did they get their fortunes?… As for Vladimir Chernukhin, the British authorities may have been embarrassed to ask him where the former deputy Minister got 135 million dollars to buy the office building of Midland Bank, because his official salary is clearly not enough to collect such money.”

Chernukhin was asked last month to clarify the appearance of this discrepancy and to account for the origin of his wealth in line with the current British statutes. He refused to reply....

Dances with Bears

PRIVATE BLIND EYE – HOW THE LAST BRITISH INVESTIGATIVE JOURNALIST TURNS ONE ON RUSSIA
John Helmer

Michael Roberts — Regulation does not work

There is one big lesson from the Danske Bank money laundering scandal. Regulating the modern banking system does not work. Modern banks are now primarily giant hedge fund managers speculating on financial assets or they are conduits for tax avoidance havens for the top 1% and the multi-nationals.…

John Horan, senior associate at Maze Investigation, Compliance and Training Ltd. in Belfast, says money laundering is a Europe-wide problem. “dark money will almost certainly continue to flow through the European banking system like sand through a sieve.” It’s a never-ending story. ...

The ‘official’ view that regulation is the only way to control the banks is accepted by most Keynesians or those who see the financial sector as the only enemy of labour. Take Nick Shaxson. Shaxson wrote a compelling book Treasure Islands, tax havens and the men who stole the world, that exposed the workings of all the global tax avoidance schemes and how banks promoted tax havens and tax avoidance for their rich clients.

And more recently, he has done a new piece of research that argues that not only does the City of London and the UK financial sector operate to help tax avoidance and money laundering, it does not provide credit for productive investment.…

As Gabriel Zucman and Thomas Wright have shown in a meticulous and in-depth analysis of the size and extent of tax havens and tax avoidance, far from them being reduced or controlled, on the contrary, such schemes are an increasing part of US corporate profits, organised and transacted by the banks.

About half of all the foreign profits of US multinationals are booked in tax havens with Ireland topping the charts as the favourite (Irish tax rate just 5.7%). And the benefits for the increase in profits have gone to shareholders, the Zucman and Wright showed. “Ireland solidifies its position as the #1 tax haven,”Zucman said on Twitter. “US firms book more profits in Ireland than in China, Japan, Germany, France & Mexico combined.” ...

So those who think that ‘regulating’ the banks and tax evasion using ‘regulators’ will work are expecting pigs to rev up their jet engines for flight.

Michael Roberts Blog
Regulation does not work

Michael Roberts

Martin Armstrong — Magnitsky Affair & the Murder of Edmond Safra in Monaco

International intrigue. Martin Armstrong was there and reports his version of it.

Armstrong Economics
Magnitsky Affair & the Murder of Edmond Safra in Monaco

CNN Confirmed Money Was Stolen from IMF
Martin Armstrong

Jack Peat — British Overseas Territories playing huge role in laundering dirty money from Russia

The amount of money held by Russians in the UK is dwarfed by the amount held in the British Overseas Territories, which include some of the world’s most significant tax havens.

The Global Witness report, Missing the Bigger Picture, is released as politicians have called for a crackdown on criminal and corrupt cash from Russia following the poisoning of Sergei Skripal and ahead of a crucial vote in parliament to increase transparency in the UK’s tax havens on Tuesday 1 May.

The analysis of figures from the IMF and Russian Central Banks shows nearly five times as much Russian money is invested in the British Overseas Territories (OTs) as is held in the UK....

Enabling bad behavior.

The London Economic
British Overseas Territories playing huge role in laundering dirty money from Russia

Jack Peat

Adam Ramsey — A fire in the world’s laundromat

The Italian author and journalist [Roberto Saviano] is well-known world-wide as the leading expert in the Calambrian mafia. Saviano has written about crime in Italy and about international drug money. He’s followed the flows of cash and he’s been awarded numerous prizes and honourary degrees for his work. But of all of the places he’s researched, he holds particular contempt for one.

Speaking last year, Saviano said:

“If I asked you what is the most corrupt place on Earth, you might tell me, well it’s Afghanistan, maybe Greece, Nigeria, the South of Italy and I will tell you it’s the UK.”

This isn’t because he thinks that the police in Britain generally accept more bribes than others, nor that our politicians stuff their brief cases with brown envelopes more than others. Rather, it’s because of the role of the City of London in laundering the proceeds of crime across the world. It’s because of the place that London takes at the heart of the planet’s biggest network of tax-havens and secrecy areas; which extends to our Overseas Territories, through the Crown Protectorates, and into the imperial metropolis itself.

But it’s not just Saviano, and it’s it just about the Cayman islands. Last year, the MPs of the Home Affairs Select Committee investigated London’s role in money laundering. Here’s their own summary of what their report says:

Open Democracy
A fire in the world’s laundromat
Adam Ramsay

Johan Nylander — Chinese banks, HSBC caught up in huge money laundering scam

Several of China’s state-controlled banks, as well as HSBC’s Hong Kong branch, have allegedly processed hundreds of millions of US dollars from a vast money-laundering operation run by Russian criminals with links to the Russian government and the spy agency FSB.

Documents obtained by the Organized Crime and Corruption Reporting Project show that at least US$20 billion was moved out of Russia between 2010 and 2014 in a vast criminal operation called “The Global Laundromat”....

Asia Times
Chinese banks, HSBC caught up in huge money laundering scam
Johan Nylander

Zero Hedge — "I’ve Never Seen Anything Like This Before" - The Housing Markets In The Hamptons, Aspen And Miami Are All Crashing

The US luxury home market is dominated by foreign buyers at least in part owing to non-existent money-laundering laws, with most sales being cash deals.

Zero Hedge
"I’ve Never Seen Anything Like This Before" - The Housing Markets In The Hamptons, Aspen And Miami Are All Crashing

Tyler Durden

Joe Mellor — Most corrupt country on planet is Britain, says Mafia expert

Fearless journalist Roberto Saviano, who has dedicated his career to exposing the Italian mafia, has claimed that it is Britain that is the most corrupt country on Earth.

The London Economic
Most corrupt country on planet is Britain, says Mafia expert

Joe Mellor, Deputy Editor

Laundering Havens for War Budgets — Sharmini Peries interviews Michael Hudson

“Closing Panama Tax Haven Will Require Fighting the Most Powerful Lobby In the World,” The Real News Network, April 14, 2016.

Economist Michael Hudson says oil and mining industries and the State Department created Panama and Liberia for the express purpose of tax evasion.

Video and transcript.

MichaelHudson.com
Laundering Havens for War BudgetsSharmini Peries interviews Michael Hudson, President of The Institute for the Study of Long-Term Economic ll Street Financial Trends (ISLET), a WaAnalyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking University

Constantin Gurdgiev — 10/4/16: The Real 'Panamas' Of Tax Havens... Are Not In Central America

A lot of what is already known is now in the spotlight owing to the Panama papers.

True Economics

10/4/16: The Real 'Panamas' Of Tax Havens... Are Not In Central America
Constantin Gurdgiev

Visual Capitalist — The World’s “Hot” Money [Chart]

How does this “hot” money leave these countries [illegally]? Global Financial Integrity has calculated that 83% of illicit financial flows are due to what it calls “trade misinvoicing”.

Visual Capitalist
The World’s “Hot” Money [Chart]
Jeff Desjardins

Vladimir Platov — Great Britain is a centre of “money laundering”

Who knew?

New Eastern Outlook
Great Britain is a centre of “money laundering”

Vladimir Platov

George Monbiot — The City’s stranglehold makes Britain look like an oh-so-civilised mafia state

To an extent unknown since before the first world war, economic relations in this country are becoming set in stone. It is not just that the very rich no longer fall while the very poor no longer rise. It’s that the system itself is protected from risk. Through bailouts, quantitative easing and delays in interest-rate rises, speculative investment has been so well cushioned that – as the Guardian economics editor, Larry Elliott, puts it – financial markets are “one of the last bastions of socialism left on Earth”.…

Property in this country is a haven for the proceeds of international crime. The head of the National Crime Agency, Donald Toon, notes that “the London property market has been skewed by laundered money. Prices are being artificially driven up by overseas criminals who want to sequester their assets here in the UK.”…

The speculative property market is just one current in the great flow of cash that sluices through Britain while scarcely touching the sides. The financial sector exploits an astonishing political privilege: the City of London is the only jurisdiction in the UK not fully subject to the authority of parliament. In fact, the relationship seems to work the other way. Behind the Speaker’s chair in the House of Commons sits the Remembrancer, whose job is to ensure that the interests of the City of London are recognised by the elected members. (A campaign to rescind this privilege – Don’t Forget the Remembrancer – will be launched very soon.)

The City is a semi-offshore state, a bit like the UK’s crown dependencies and overseas territories, tax havens legitimised by the Privy Council. Britain’s financial secrecy undermines the tax base while providing a conduit into the legal economy for gangsters, kleptocrats and drug barons.

Even the more orthodox financial institutions deploy a succession of scandalous practices: pension mis-selling, endowment mortgage fraud, the payment protection insurance con, Libor rigging.…

How can this be?

At next month’s Conservative party conference, corporate executives will pay £2,500 to sit with a minister. Doubtless, because we are assured that there is no link between funding and policy, they will spend the day discussing the weather and the films they have seen. If we noticed such arrangements overseas, we might be inclined to regard them as corruption. But that can’t be the case here, not least because the invitation explains that “fees associated with business day & dinner are considered a commercial transaction and therefore do not constitute a political donation”.

The government also insists that there is no link between political donations and seats in the House of Lords. But a study by researchers at Oxford University found that the probability of so many major donors arriving there by chance is 1.36 x 10-38: roughly “equivalent to entering the National Lottery and winning the jackpot 5 times in a row”. Why does the Lords remain unreformed? Because it permits plutocratic power to override democracy. Both rich and poor are kept in their place.….

These are just some excerpts. It's worse, much worse. The culture is corrupt.

The Guardian | Comment Is Free
The City’s stranglehold makes Britain look like an oh-so-civilised mafia state
George Monbiot

A fully referenced version of this article can be found at Monbiot.com

John Helmer — IMF Officials Implicated In Theft, Concealment Of Ukraine Loan Corruption

Officials of the International Monetary Fund (IMF) are in flight from evidence of negligence, incompetence, and corruption in their management of billions of dollars in loans for Ukraine.

Nikolai Gueorguiev, head of the Ukraine team at IMF headquarters in Washington, DC, and Jerome Vacher, the IMF representative in Kiev, refuse to respond to questions on their role in the offshore diversion of IMF loan money through Privatbank and Credit Dnepr Bank, banks owned by Ukrainian oligarchs Igor Kolomoisky and Victor Pinchuk. The Fund’s Managing Director Christine Lagarde (lead image, front) and her spokesman, Gerry Rice (rear), are covering up evidence of conflicts of interest and multiple violations of the IMF Staff Code of Conduct which have been occurring in the Ukraine loan programme. Simonetta Nardin, head of the Fund’s media relations, refuses to explain her apparent violations of the Code, or respond to evidence that she fabricated elements of her career resume.

On Tuesday a spokesman at the US Department of Justice in Washington confirmed that an investigation is under way of the role played by US clearing banks in the movement of IMF funds through the Privatbank group and companies connected with Kolomoisky. Speaking for the Asset Forefeiture and Money Laundering Section, Peter Carr declined to give more details.

Dances with Bears
IMF Officials Implicated In Theft, Concealment Of Ukraine Loan Corruption

John Helmer

Vladimir Platov — Billions of Dollars Laundered Through United Kingdom Banks

The UK National Crime Agency recently stated that “hundreds of billions of US dollars” are laundered through banks in the United Kingdom every year. London holds first place among world capitals with regard to the volume of drug trade and money laundering. Describing the global international drug trade network, Roberto Saviano, an Italian investigative journalist and author of Gomorrah, a book on the Neapolitan mafia, said a few days ago of the international drug trade that “Mexico is its heart and London is its head”. He also reminded readers of the British bank HSBC’s £1.2 billion fine for money laundering for a Mexican drug cartel in 2012.…

First appeared: http://journal-neo.org/2015/07/13/billions-of-dollars-laundered-through-united-kingdom-banks/

New Eastern Outlook
Billions of Dollars Laundered Through United Kingdom Banks

Vladimir Platov

ICIJ — Banking Giant HSBC Sheltered Murky Cash Linked to Dictators and Arms Dealers

Team of journalists from 45 countries unearths secret bank accounts maintained for criminals, traffickers, tax dodgers, politicians and celebrities 

Secret documents reveal that global banking giant HSBC profited from doing business with arms dealers who channeled mortar bombs to child soldiers in Africa, bag men for Third World dictators, traffickers in blood diamonds and other international outlaws. 

The leaked files, based on the inner workings of HSBC’s Swiss private banking arm, relate to accounts holding more than $100 billion. They provide a rare glimpse inside the super-secret Swiss banking system — one the public has never seen before. 

The documents, obtained by the International Consortium of Investigative Journalists via the French newspaper Le Monde, show the bank’s dealings with clients engaged in a spectrum of illegal behavior, especially in hiding hundreds of millions of dollars from tax authorities. They also show private records of famed soccer and tennis players, cyclists, rock stars, Hollywood actors, royalty, politicians, corporate executives and old-wealth families.

These disclosures shine a light on the intersection of international crime and legitimate business, and they dramatically expand what’s known about potentially illegal or unethical behavior in recent years at HSBC, one of the world’s largest banks.…

“The offshore industry is a major threat for our democratic institutions and our basic social contract,” French economist Thomas Piketty, author of Capital in the Twenty-First Centurytold ICIJ. “Financial opacity is one of the key drivers of rising global inequality. It allows a large fraction of top income and top wealth groups to pay negligible tax rates, while the rest of us pay large taxes in order to finance the public goods and services (education, health, infrastructures) that are indispensable for the development process.”

ICIJ

Banking Giant HSBC Sheltered Murky Cash Linked to Dictators and Arms Dealers

Gerard Ryle, Will Fitzgibbon, Mar Cabra, Rigoberto Carvajal, Marina Walker Guevara, Martha M. Hamilton and Tom Stites

John Helmer — Sergei Pugachev Is The Boy On The Burning Deck – Condemned By The Uk High Court, Only The Financial Times To Hang On To

High finance, Russian style. How an oligarch got his money. The City seems to think it is just fine?

Dances with Bears

Sergei Pugachev Is The Boy On The Burning Deck – Condemned By The Uk High Court, Only The Financial Times To Hang On To

John Helmer

Emily Flitter And Douwe Miedema — Bitcoin hit by denial of service attacks as regulators prepare clampdown

Tighter regs coming.

Reuters
Bitcoin hit by denial of service attacks as regulators prepare clampdown
Emily Flitter And Douwe Miedema

Scott Kaufman — Florida seeks to ‘strangle the lifeblood’ of Bitcoin by targeting anonymous transactions (via Raw Story )

Florida seeks to ‘strangle the lifeblood’ of Bitcoin by targeting anonymous transactions (via Raw Story )

In an unprecedented move, authorities in Florida are targeting bitcoin traders simply for purchasing the currency. Unlike previous prosecutions in which Bitcoin users were suspected of participating in other illegal activities, the Miami Beach Police…

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