WIRED: How TrumpCo Launders Their $$$

[kpete]

“you purchase a rug that’s worth $5,000 for, say, $20,000 & the store owner returns the difference to you in cash”

WHILE IT’S EASIER to grasp how to hide cash at the street level—like in Breaking Bad, when Walter White purchases a cash-intensive car wash and simply cooks the book to show he’s washing more cars than he is—money laundering at the global level follows the same three-step process:

Step 1: Placement

The first challenge is simply getting the money somewhere into the global financial system, which is often easier said than done. Banks are required to file reports anytime someone deposits more than $10,000 in cash, so sneaking large amounts of cash into the financial system can pose a huge challenge. Breaking large transactions into smaller ones, say multiple deposits of $9,999, to evade the transaction reports is known as “structuring” or “smurfing,” and is illegal itself. Former Speaker of the House Dennis Hastert spent time in prison for “structuring,” as part of his effort to pay hush money to one of the men he sexually abused as a high school coach, rather than for the underlying abuse. “Placement is where criminals are most vulnerable, because the money is closest to the original crime,” Cassara says. “It’s much easier to catch them at the crime than to say ‘there’s a suspicious shopping center or golf course’ and work backwards.”

Tracing “laundered” money back to illicit proceeds is key to any investigation.

Step 2: Layering

The second challenge is hiding the origin of the illicit money. That’s where the layers of LLCs can be helpful. Every time money moves—from one entity’s account to another, from one bank to another, from one country to another—it helps hide the original source. “It’s confusing and makes it difficult for investigators, tax officials, or a former wife to follow that money trail. It’s using this labyrinth of LLCs and tax havens, in the US and overseas, to make it difficult and time-consuming to trace,” Cassara says. “It gets hard because of issues of [investigative] competence, venue, jurisdiction.”


Often, this “layering” step takes place with the help of lawyers and law firms; the revelations of the Panama Papers and the follow-on Paradise Papers laid out just how large a global business it is to help elites hide their assets. “Many of these folks have go-to structures and lawyers they use to go through the layering process,” Sharma says. “A lot of laundering happens through nonfinancial businesses and professions.…The Russians use a ton of folks in Turkey, UAE, and Cyprus. That fact pattern is well-known and long-standing.”

While the Panama and Paradise Papers revelations focused primarily on overseas entities and tax havens, the United States is actually one of the worst global offenders: The so-called “Delaware company” structure is notorious for its lax documentation and opacity, as NPR’s Planet Money found out when they set up shell companies in Belize and Delaware in 2012.

Step 3: Integration

Once the money is in the global financial system and its origins properly obfuscated, the final challenge is making the money accessible—that is, integrating it into the legitimate economy. At the high end of money laundering, this often means purchasing real estate.

“Real estate is a big issue for money laundering and has been for a long time,” Cassara says. “If you’ve got a condo or a shopping center or a golf course, the money has already been placed, it’s already been layered, it’s the final stage—integrated. The authorities aren’t going to look at that. Once you see property, in whatever form it is, it’s assumed that’s good, that’s a legitimate investment.”

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WAY MORE:
https://www.wired.com/story/if-trump-is-laundering-russian-money-heres-how-it-works/amp

[kentuck]

1. Excellent synopsis!

On how difficult it is to catch these criminals before the money is integrated into the financial system.

[dalton99a]

2. A must read.

[Nancy Waterman]

3. Important read!

This is the underlying issue to the entire Trump/Mueller/Cohen story. When the money laundering angle, past and present, gets sorted out, Trump will be done. But there are so many layers and so much obfuscation to get through. This is the key and the answer to it all.

[RandomAccess]

4. Oh, very good. Thanks.

[erronis]

5. Thanks for the link and synopsis. I hope all these threads can build some nooses.

For the drump/repuglicon crime family.

[lunatica]

6. I needed this

to start to understand money laundering. At least now it’s not so opaque, and it explains why Mueller is forced to go slow. It also explains why Manafort is still holding out. He knows how hard it is to actually follow the money when international laundering is involved.

[Uncle Joe]

7. Kicked and recommended.

Thanks for the thread kpete