Largest Money-Laundering Scam In History?

Explanation: Bharara speaks beside a chart detailing the operation of the Costa Rica-based company

Online Currency Company Founder Indicted For Largest Money-Laundering Scam In History 'After Website Users Carried Out Millions Of Criminal Transactions Worth $6 BILLION' -- Daily Mail

* Arthur Budovsky, founder of Liberty Reserve, arrested in Spain on Friday
* Six others have also been charged in $6 billion money transfer scheme
* Liberty Reserve allowed users to convert money to online currency
* Transactions 'hid the proceeds of crimes including credit card fraud, child pornography, identity theft and drugs trafficking'
* U.S. Attorney: 'It was the bank of choice for the criminal underworld'

The founder of an internet company that allows users to convert money to an online currency has been indicted in the U.S. for a massive $6 billion money-laundering scheme - in what authorities have called the largest case of its kind in history.

Arthur Budovsky, the founder of Liberty Reserve, was arrested in Spain on Friday.

The Costa Rica-based company, which had more than one million users, allegedly helped hide 55 million illegal transactions across the world, authorities said today.

In total, seven people indicted for their alleged part in the cyber network, which authorities said was 'staggering' in scope. Budovsky's partner, Vladimir Kats, is in custody in New York.

Read more ....

More News On Liberty Reserve Being Shut Down In A $6bn Money Laundering Case

U.S. accuses currency exchange of laundering $6 billion -- Reuters
US charges seven men over Liberty Reserve digital cash laundering -- The Australian/Wall Street Journal
Liberty Reserve shut down in $6bn money laundering case -- The Telegraph
US prosecutors: Liberty Reserve ran $6bn money-laundering scheme -- The Guardian
Police in 17 Countries Smash Huge Money Laundering Scheme -- Voice of America
Feds bust online currency firm in $6B money-laundering scheme -- CBS/AP
Secret Service busts $6 billion money laundering scheme -- FOX News
Digital currency exchange accused of biggest money laundering scheme ever -- RT
Online Service Is Accused in Laundering of $6 Billion -- New York Times
7 charged in $6B online money-laundering case -- Miami Herald
Liberty Reserve website at center of $6 billion money-laundering scheme: prosecutors -- New York Daily News
Liberty Reserve Founder Indicted on $6 Billion Money-Laundering Charges -- Threat Level
Alleged $6 billion money-laundering network busted -- USA Today
Liberty Reserve founder arrested in Spain -- The Guardian

How To Hinder Money Laundering

How To Halt The Terrorist Money Train -- Robert Mazur, New York Times

LAST month, HSBC admitted in court pleadings that it had allowed big Mexican and Colombian drug cartels to launder at least $881 million. The bank also admitted to using various schemes to move hundreds of millions of dollars to nations subject to trade sanctions, including Iran, Cuba and Sudan, in violation of the Trading With the Enemy Act. “On at least one occasion,” according to a statement by Assistant Attorney General Lanny A. Breuer, “HSBC instructed a bank in Iran on how to format payment messages so that the transactions would not be blocked or rejected by the United States.”

Read more ....

My Comment: I agree with Robert Mazur's solution ... putting bankers in jail for long periods of time (plus heavy fines) will severely hinder this trade.

Money Continues To Pour Out Of Afghanistan

Idle bulk-currency counters at Kabul International Airport. SIGAR

Vast Sums Of Aid Continue To Be Stolen In Afghanistan -- Christian Science Monitor

Despite years of supposed effort to stop money laundering out of Kabul airport, billions continue to flow from the country unchecked.

In the summer of 2010, the US decided to do something about the enormous sucking sound being generated by the bulk cash shipments funneling through Afghanistan's Kabul airport and on to Dubai, Zurich, and London – every point of the compass, really.

With Afghanistan's two principal cash crops being opium and slicing chunks off the top of international aid, there were no prizes for guessing where the tens of billions of dollars transferred from Afghanistan since the US-led war began in 2002 came from, or how the luxury villas of so many Afghan officials in the United Arab Emirates had been paid for.

Read more ....

More News On Afghanistan's Problem Of Corruption

Kabul Is The Best Place In The World To Move Boatloads Of Unmarked Cash -- Business Insider
U.S. report: Afghans still funneling cash out of country -- Washington Times
Despite U.S. aid, little progress in monitoring Kabul airport cash flow -- Reuters
US report says Kabul airport not using its currency counters to track cash leaving Afghanistan -- Washington Post/AP
Watchdog: Kabul airport still not counting cash -- Foreign Policy
Elites Still Bypassing Measures to Combat Money Laundering -- Time
U.S. finds Afghan anti-corruption efforts ‘deeply troubling’ -- Washington Post

Standard Chartered Reaches $340 Million Settlement With The US For Laundering Iranian Funds

Standard Chartered Reaches $340 Million Settlement Over Iran -- Reuters

(Reuters) - Standard Chartered Plc will pay $340 million to New York's bank regulator over transactions linked to Iran, in a speedily arranged deal likely to cheer its shareholders.

The deal with New York Superintendent of Financial Services Benjamin Lawsky still left the British bank facing a separate probe of Iran-linked transactions by other U.S. authorities.

The deal on Tuesday capped a week of transatlantic tension and a furor over why a state agency had upstaged the other authorities.

The resolution also averted a hearing on Wednesday at which the bank had been called to demonstrate why its license to do business in New York should not be revoked.

Read more ....

More News On Standard Chartered Reaching A Settlement With New York For Laundering Iranian Funds

British Bank in $340 Million Settlement for Laundering -- Wall Street Journal
Bank Settles Iran Money Case -- Wall Street Journal
Standard Chartered to pay $340 million to settle with N.Y. over Iran charges -- Washington Post
Bank settles Iran money probe in NY for $340M -- Bloomberg Businessweek/AP
N.Y. Settles Standard Chartered Probe For $340 Million -- Bloomberg
Standard Chartered pay $340m fine to New York bank regulator -- The Guardian
Standard Chartered to pay $340m settlement over Iran investigation -- The Telegraph

My Comment: This is outrageous. People should be going to jail for this, and Business Chartered should have it's US license canceled.

Mexico's Drug Cartels Transfer $40Billion A Year

Mexico’s Cartels Transfer $40B Yearly From U.S.: Report -- Toronto Star/Bloomberg

Mexico’s drug trafficking cartels repatriate almost $40 billion every year after laundering the money in the U.S., newspaper El Universal reported Wednesday, citing an interview with retired U.S. Army General Barry McCaffrey, the White House’s anti-drug czar from 1996 to 2001.

The criminals use 10 highways in the U.S., particularly in Texas, to transfer the money in cash to Mexico, McCaffrey said, according to the newspaper.

Read more ....

My Comment: Only $40 billion?

HSBC Permitted Drug Kingpins And Rogue Nations To Use Their Bank Services

HSBC apologised for its lapses, said reforms had been put in place, and admitted it was 'horrified' by what it found. Photograph: Gary Cameron/Reuters

HSBC Used By 'Drug Kingpins', Says US Senate -- BBC

HSBC provided a conduit for "drug kingpins and rogue nations", according to a US Senate committee investigating money laundering claims at the bank.

Its report said suspicious funds from countries including Mexico, Iran and Syria had passed through the bank.

The president and chief executive of HSBC Bank USA, Irene Dorner, apologised to the committee for the behaviour which she said deeply regretted.

Earlier, HSBC's head of compliance, David Bagley, resigned at the hearing.

Read more ....

More News ON HSBC Link To Drug Kingpins And Rogue Nations

HSBC 'sorry' for aiding Mexican drugs lords, rogue states and terrorists -- The Guardian
HSBC contrite as senators hammer money-laundering lapses -- Reuters
HSBC accused by Senate of allowing billions in Mexican drug cartel cash to be laundered -- CBS/AP
HSBC linked to drug lords and terrorists, Senate report alleges -- L.A. Times
HSBC Allowed Laundering, U.S. Probe Says -- Bloomberg Businessweek
HSBC’s U.S. Bank Regulator Was ‘Lapdog,’ Senator Coburn Says -- Bloomberg
Regulators and HSBC Are Faulted by Senate -- Dealbook/New York Times
HSBC's Laid Back Ways Lead to Money Laundering, Report Says -- Fox News/AP
HSBC head of compliance stepping down; executives apologize for lapses -- Washington Post/AP
HSBC compliance boss quits during hearing -- Financial Times
HSBC's Compliance Chief to Step Down -- Wall Street Journal

My Comment: Bank officials should be going to jail .... for a long time .... and government bank regulators should be fired and barred from working in the financial field. But .... do not be surprised if nothing will happen ... such is the deep corruption in our government and financial institutions.

Report: Lebanon's Banks Used By Iran To Evade Sanctions

Beirut Banks Funneling Illicit Funds For Hezbollah -- Jerusalem Post

Report says Hezbollah using Lebanon’s banks in money-laundering scheme, calls on firms to dump Lebanese debt.

In a move that could destabilize Beirut’s financial position, a US pressure group urged international financial firms on Tuesday to ditch Lebanese debt and securities, saying that Hezbollah is using Lebanon’s banks in a large scale money-laundering scheme that is also helping Iran evade banking sanctions.

Read more ....

My Comment: If this report is true .... and if Iran is involved .... this case would make it to be one of the world's largest laundering schemes ever.

Cutting The Flow Of Stolen Money From Dictators To Their Private Bank Accounts

Colonel Gaddafi, Mubarak, Ben Ali, and Yemeni President Saleh

UK Government Urged To Name Banks Who Handled Money For Gaddafi, Mubarak And Ben Ali -- The Telegraph

The Government should name banks that have been holding money for the shamed North African and Middle Eastern dictators whose funds have been frozen as a result of uprisings.

The call from campaigning charity Global Witness comes as the coalition warplanes have continued their attacks against Colonel Gaddafi's forces in Libya.

Global Witness is calling for the names of banks that have handled money on behalf of leaders including Gaddafi, Hosni Mubarak and Zine Ben Ali to be named as part of the process of freezing the accounts.

So far over £25bn of assets has been frozen worldwide with £2bn locked down in the UK.

Read more ....

My Comment: Western powers simply lack the political will to limit currency transfers and deposits from the dictators of the world. I expect this mindset to continue well into the future.

U.S. Targets Hezbollah's Money Machine

Bank Accused Of Laundering Drug Money For Hezbollah -- MSNBC

U.S. car dealerships part of 'mind-boggling' international criminal enterprise, U.S. charges.

The Treasury Department on Thursday blacklisted one of the largest banks in Lebanon, accusing it of being part of what one official calls a “mind-boggling” international criminal enterprise that is laundering hundreds of millions of dollar in illegal drug money every year for the benefit of Hezbollah.

The action, which was announced Thursday by Undersecretary of Treasury Stuart Levey, is the latest development in a four-year investigation that officials say has uncovered links between one of Colombia’s biggest drug traffickers, top leaders of Hezbollah and the Iranian government.

Read more ....

More News On U.S. Sanctions On The Lebanese Canadian Bank SAL

US declares Lebanese bank a major money launderer -- AP
US ties Lebanese bank to money laundering, Hezbollah -- AFP
Lebanese Bank Is Accused of Money Laundering -- New York Times
U.S. Sanctions Lebanese Bank -- Wall Street Journal

My Comment: This is going to hurt them .... the U.S. is now targeting their pocketbook.

Looking For The World's Dirty Money

Probe Circles Globe to Find Dirty Money -- Wall Street Journal

A black-market financial investigation spreading from Iran to Sudan, London and Cuba began in a cluttered fifth-floor cubicle in an old-school district attorney's office in Manhattan featuring dark corridors and frosted glass.

There, an intelligence analyst named Eitan Arusy began studying a slim lead. Suspicious money was flowing to and from an Iranian nonprofit operating in a Fifth Avenue office tower in Midtown Manhattan. Mr. Arusy's probe, later merged with a Justice Department inquiry, ultimately widened to some of Europe's vaunted banks, helping spark a global inquiry that found they actively evaded U.S. law in aiding sanctioned countries, banks or other enterprises move some $2 billion undetected.

Read more ....

My Comment: This post from the Wall Street Journal reminds me of how drug gangs were using American banks to launder their cash in the late 1970s - early 1980s. Plus ca change .... plus c'est le meme chose .... the more things change, the more that they stay the same.

Unfortunately .... in this case .... we have unsavory and dangerous regimes who are laundering monies to finance their wars and military machines. Kudos to individuals like Eitan Arusy who are exposing these networks.

Cutting The Flow Of Money Out Of Afghanistan

U.S., Afghanistan Plan To Screen Cash At Kabul Airport To Prevent Corruption -- Washington Post

Alarmed by an exodus of money from Afghanistan, U.S. and Afghan authorities are trying to constrict a flow of cash through the country's main airport, believed to be a major conduit for drug proceeds and diverted foreign aid.

The plan, part of an effort to monitor an outflow of money thought to exceed $1 billion a year, centers on the installation of U.S.-developed currency counters at the Kabul airport. The devices would be used to record serial numbers on bills to determine whether money being carried out of the country has been siphoned from aid funds flowing in, U.S. and Afghan officials said.

Read more ....

My Comment: This is long over due .... very long over due.

To Stop The Corruption In Afghanistan .... Stop The Transfer Of Monies Out Of The Country

Corruption Suspected in Airlift of Billions in Cash From Kabul -- Wall Street Journal

KABUL—More than $3 billion in cash has been openly flown out of Kabul International Airport in the past three years, a sum so large that U.S. investigators believe top Afghan officials and their associates are sending billions of diverted U.S. aid and logistics dollars and drug money to financial safe havens abroad.

The cash—packed into suitcases, piled onto pallets and loaded into airplanes—is declared and legal to move. But U.S. and Afghan officials say they are targeting the flows in major anticorruption and drug trafficking investigations because of their size relative to Afghanistan's small economy and the murkiness of their origins.

Read more ....

My Comment: I love the title for this story .... "Corruption Suspected in Airlift of Billions in Cash From Kabul" .... please .... that is all our aid/development money going out of the country to private accounts and close family members who live abroad.

My recommendation .... shut it down and tell people to go to the bank to transfer this money .... at least this way you will know who is doing the transferring .... and who is benefiting from this transfer of wealth.

But my guess is that nothing is going to be done .... too many people have a vested interest to keep this going.

Ten Of The World's Top Banks Accused Of Laundering Money For Iran

The facade of branch of Lloyds TSB, which admitted to laundering $300 million to Iran. Sources say some of the money went to fund terrorist groups like Hamas and Hezbollah. Dunham/AP

From Newsday:

Some of the world's top banks helped Iran get around international sanctions even as the rogue nation was steering its blood money into the hands of terror groups, prosecutors charged Friday.

Ten international banks including British-based Lloyds laundered "billions of dollars" for Iran through New York banks, Manhattan District Attorney Robert Morgenthau announced Friday. The scheme helped Iran turn its dirty money into greenbacks, which it could then use to buy goods prohibited by international sanctions.

Some of the money went to fund terrorist groups like Hamas and Hezbollah, and to help Iran get materials, including tungsten, for long-range missiles, sources said.

"This is one of the biggest investigations we've ever conducted," said Morgenthau.

Lloyds admitted it laundered $300 million and agreed to pay a $350 million fine and open its books to investigators. If records show that the bank knew it was helping Iran break international law or foster terrorism, Lloyds could face criminal prosecution, authorities said.

None of the other nine banks was identified because they are working out similar agreements with Morgenthau's investigators. The CIA will also review the bank records.

Read more .....

More News On Western Banks Laundering Money
For Iran And Other Countries

Ten of world's top banks laundered money for Iran -- Economics Times Of India
Iran Moved Billions via U.S. Banks -- New York Times
Lloyds TSB agrees to pay fine of $350m for sanctions help -- The Telegraph

My Comment: The bank officials who permitted this should be prosecuted under the full extant of the law. If a direct link between funds are found that links it to teror groups that have killed people, murder charges should also be leveled.

But (unfortunately) it is not going to happen.