Money Laundering Is A Growth Industry

Consumerist’s Guide to the New Money Sanitization Industry

The New York Times recently provided details about how foreign banks send their clients’ funds to American banks for money laundering: “The list of global banks… accused…of laundering foreign transactions totaling billions of dollars has been growing—Credit Suisse, Lloyds, Barclays, ING, HSBC—and now Standard Chartered.”*

Is this the banking idea of a new American growth industry? Might be: It is insourced, not outsourced, onshore not offshore. Calling it “money laundering” might soil the image. Let’s call it the Money Sanitization Industry to spruce it up. The banks listed above come to the USA for the best money processing in the world. The money sanitization market is huge, especially (as the NY Times noted) from organized crime, terrorist groups and drug cartels. Iran, North Korea and Cuba need money sanitization services. Legitimate corporations move money for tax sheltering and privacy purposes. Our banks are good at this stuff.

To better understand professional money sanitization, consider the arts of stripping and making U-Turns as practiced by bankers:

Stripping:  Removal of data after transfer of funds from one financial institution to another…to conceal the transaction’s origins in future transfers. Stripping originated with Lloyds of London.**

U-Turn: Money sent by foreign banks to American banks for “processing” to obscure the origin of the funds and their eventual destination which is the bank that sent it. Bankers, ever creative, call it a U-Turn.

When our onshore bankers work with those offshore bankers, sanitation hides contamination.

Next blog post: A look at how bankers avoid jail time.  


*From A Lax Banking Law Obscured Money Flow, by Jessica Silver-Greenberg and Edward Hyatt, New York Times Business Day, Aug 9, 2012, page B1.

**From The Corp-Speak Glossary in my The Consumerist Manifesto Handbook, Sterling Publishers, page 189.


Tags: , , , , , , , , ,

Comments are closed.