Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

HSBC's Money Laundering Scandal (2022)

investopedia.com

Post reply on HN
Print view View original

41–50 of 118 posts

Re: HSBC's Money Laundering Scandal (2022)

#41

Post by AlbertCory »

There's an episode of Better Call Saul where Mike Ehrmantrout launders his $200,000 through a shady company. He gives them the cash, they pay him $20,000 a month for "logistics consulting." He tells them "make it 'security consulting.' I don't know anything about logistics." So he's got a 1099 or W-2 for his money, he pays taxes on it, and it's all clean.

How many no-show jobs like this exist?

Or actual jobs at a 501(c)(3). You can start one, hire yourself and your "business associates" at salaries that are somewhat justifiable, spend 5-10% of the assets annually on legitimate charity work, and you're set.

Of course, this doesn't deal as well with drug cartel-class amounts of money.

Re: HSBC's Money Laundering Scandal (2022)

#42

Post by olalonde »

photochemsyn wrote: post #18

Why aren't bankers who launder billions for drug cartels given the kind of multi-decade federal prison sentences that 25-yr-old kids smuggling a few kilos of cocaine from Mexico to the United State are? It certainly makes it look like outfits like the FBI and DEA are little more than the enforcement arms of an organized white-collar crime cartel operating out of Wall Street offices, doesn't it? Amusingly James Comey…

I hate banks as much as anyone but... The concept of "money laundering" is a fabricated offense that shouldn't even exist. It basically shifts the duties of law enforcement onto private businesses and individuals. The expectation for bankers or real estate agents to uncover criminals when the police struggle to do so is unreasonable and doesn't make sense. Sure they should cooperate with police investigations but they shouldn't be leading them. Additionally, private businesses are not subject to the same legal principles such as the presumption of innocence and due process, leading to countless individuals being denied access to basic banking services based on perceived risk[0]. To top it off, those laws are ineffective and very costly to implement[1].

[0] There is an estimated 1,400,000,000 unbanked people worldwide (a good chunk of which are denied access on the basis of risk and/or lack of satisfying identification).

[1] https://www.cato.org/blog/money-laundering-laws-ineffective-...

Re: HSBC's Money Laundering Scandal (2022)

#43

Post by snozolli »

josu wrote: post #28
photochemsyn wrote: post #18

Why aren't bankers who launder billions for drug cartels given the kind of multi-decade federal prison sentences that 25-yr-old kids smuggling a few kilos of cocaine from Mexico to the United State are? It certainly makes it look like outfits like the FBI and DEA are little more than the enforcement arms of an organized white-collar crime cartel operating out of Wall Street offices, doesn't it? Amusingly James Comey…

It is complicated, for many reasons. A very important one is that responsibility is very diluted. - A bank executive opens an account to a seemingly legit company. - The compliance department OKs the account opening. - A bank teller receives 50k USD in cash every month. - Another teller receives another 50k USD in cash every month. - The head of the branch doesn't report strange activity. - The AML system by the bank…

Do you make the CEO responsible even though she probably had no idea that this was going on?

You send the CEO to prison because they're responsible for what happens under them. CEOs always say they get paid so much because they're the ones bearing ultimate responsibility, so off to jail you go.

Re: HSBC's Money Laundering Scandal (2022)

#44

Post by fmajid »

fogforthought93 wrote: post #9
gadders wrote: post #8

Earlier quoted context omitted.

These aren't business decisions taken to corner the money laundering market for Mexican cartels. It's more like Mexican cartels try all the banks to see which ones they can launder money through, and when they find one with poor controls that allow it they double-down on using that bank until their activity is stopped. Maybe at the country level they were happy with the transaction fees, but I would be surprised if i…

Do you have a source for the claim that drug cartels "try all the banks to see which ones they can launder money through"? I don't believe that's how it works at all. If you read, for example Drug Cartels Do Not Exist by Oswaldo Zavala, you'll see that this money is fundamental to how global finance operates. Drug money provided the necessary liquidity to keep the world finance system from crashing in '08. It's the m…

For HSBC I doubt it. But I remember seeing a map of all the branches the defunct BCCI bank had, and they had something like 10x more branches in Colombia than in the US (this was a Pakistani Bank). They went under a few years later.

Re: HSBC's Money Laundering Scandal (2022)

#45

Post by fmajid »

chaostheory wrote: post #21
cscurmudgeon wrote: post #19

Earlier quoted context omitted.

> What banks are doing is "a regular cycle" of modern capitalism (although this sounds like nonsense) - greed. This is not capitalism though. Like True socialism/communism, True Capitalism has never been tried. This is all crony capitalism with state protection.

Agreed. Also if people are going to constantly bring up late stage capitalism, we should also talk about late stage socialism. Late stage capitalism tends to happen more often and much sooner.

And late-stage socialism ends up with 50M dead as under Stalin or Mao. Pol Pot tried his best to keep up, but he just didn't have that many Cambodians available to murder.

Re: HSBC's Money Laundering Scandal (2022)

#46

Post by motohagiography »

I can't help but think there is just a layer of party affiliated political power where corruption is a status signal, and you only ever face charges when you lose your position and political leverage. All the banks launder money, but only some fall into disfavour where their political corruption or compromise collateral gets called in and someone faces charges.

Re: HSBC's Money Laundering Scandal (2022)

#47

Post by zxcvbn4038 »

AlbertCory wrote: post #41

There's an episode of Better Call Saul where Mike Ehrmantrout launders his $200,000 through a shady company. He gives them the cash, they pay him $20,000 a month for "logistics consulting." He tells them "make it 'security consulting.' I don't know anything about logistics." So he's got a 1099 or W-2 for his money, he pays taxes on it, and it's all clean. How many no-show jobs like this exist? Or actual jobs at a 501…

The Mexican cartels will buy winning lottery tickets, full value, cash up front. Then when authorities question the source of their income, oh the guy has a nice house because he won the lottery fourteen times, here is all the documentation, here are the bank records showing the reoccurring deposits. Oh, and it’s not his nice house, he rents it. The cars are all leased. Legitimate income, no assets, even pays taxes - your move Johnny Law.

Re: HSBC's Money Laundering Scandal (2022)

#48

Post by delusional »

snozolli wrote: post #43
josu wrote: post #28

Earlier quoted context omitted.

It is complicated, for many reasons. A very important one is that responsibility is very diluted. - A bank executive opens an account to a seemingly legit company. - The compliance department OKs the account opening. - A bank teller receives 50k USD in cash every month. - Another teller receives another 50k USD in cash every month. - The head of the branch doesn't report strange activity. - The AML system by the bank…

Do you make the CEO responsible even though she probably had no idea that this was going on? You send the CEO to prison because they're responsible for what happens under them. CEOs always say they get paid so much because they're the ones bearing ultimate responsibility, so off to jail you go.

The first person who went to prison for the VW emissions scandal was the engineer.

Re: HSBC's Money Laundering Scandal (2022)

#49

Post by AlbertCory »

zxcvbn4038 wrote: post #47
AlbertCory wrote: post #41

There's an episode of Better Call Saul where Mike Ehrmantrout launders his $200,000 through a shady company. He gives them the cash, they pay him $20,000 a month for "logistics consulting." He tells them "make it 'security consulting.' I don't know anything about logistics." So he's got a 1099 or W-2 for his money, he pays taxes on it, and it's all clean. How many no-show jobs like this exist? Or actual jobs at a 501…

The Mexican cartels will buy winning lottery tickets, full value, cash up front. Then when authorities question the source of their income, oh the guy has a nice house because he won the lottery fourteen times, here is all the documentation, here are the bank records showing the reoccurring deposits. Oh, and it’s not his nice house, he rents it. The cars are all leased. Legitimate income, no assets, even pays taxes -…

I hadn't heard of that. I know casinos had been a good way to launder money (buy $100,000 worth of chips, lose $5,000, cash out for $95,000), but I think they caught on to that.

Re: HSBC's Money Laundering Scandal (2022)

#50

Post by zxcvbn4038 »

AlbertCory wrote: post #49
zxcvbn4038 wrote: post #47

Earlier quoted context omitted.

The Mexican cartels will buy winning lottery tickets, full value, cash up front. Then when authorities question the source of their income, oh the guy has a nice house because he won the lottery fourteen times, here is all the documentation, here are the bank records showing the reoccurring deposits. Oh, and it’s not his nice house, he rents it. The cars are all leased. Legitimate income, no assets, even pays taxes -…

I hadn't heard of that. I know casinos had been a good way to launder money (buy $100,000 worth of chips, lose $5,000, cash out for $95,000), but I think they caught on to that.

The best way today is to give the money to friends and family and then have them give it back to you as a gift. Gift income is legitimate, the IRS can’t go challenge the people and ask where they got the money to give to you.
Post reply on HN