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Squillions: How money laundering won

lrb.co.uk

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Re: Squillions: How money laundering won

#71

Post by jcattle »

seanhunter wrote: post #42

Aside: The author of this article wrote a fantastic novel that not a lot of people know about called “The Debt to Pleasure”. One of the best instances of the “unreliable narrator” I’ve ever read.

Good to know, thanks! This article was such a breath of fresh air compared to the usual "LLM-assisted" writing you get.

Just sentences like this:

> This isn’t just a problem for far-off countries of which we know little, like the EU and the US and China. Here in the UK [...]

So good! I feel like I'm becoming an old cynic but if it's the tenth time on the day that I read an overdramatized "It's not X, it is Y" in an article, actually good writing just hits different.

Re: Squillions: How money laundering won

#72

Post by rwmj »

graemep wrote: post #70
arttaboi wrote: post #22

Here's an anecdotal thought: AML laws surprisingly work well to discourage offline transactions by tax-paying citizens, helping maximize tax reporting and improve tax collection. As a result, governments continue to strengthen and expand laws in that direction.

> As a result, governments continue to strengthen and expand laws in that direction. Which creates national security and sovereignty issues. Cash is robust and decentralised. There is a good reason Sweden went from pushing cashless to advising people to keep cash at home for emergencies, and were at least considering an obligation to accept cash for small transactions.

> Which creates national security and sovereignty issues

Are you talking about people who don't pay tax? They create very large national security and sovereignty issues. Countries that don't collect much tax have real problems with both of these.

> There is a good reason Sweden went from pushing cashless to advising people to keep cash at home for emergencies

The key phrase being "for emergencies".

Re: Squillions: How money laundering won

#73

Post by pjc50 »

jcattle wrote: post #69
mike_hearn wrote: post #66

I learned a lot about the AML system many years ago and still have some books about how it works on my bookshelf. It's fascinating stuff. A few minor comments. My wife and I have owned and used 1000 CHF notes quite a few times in the past. The last two times we moved apartments I paid part of the moving fee with a 1000 CHF note. We've also bought furniture this way. Nobody was surprised to see this and the notes were…

I'm not suprised that in the swiss economy no one bats an eye at 1000 CHF bank notes. After all the swiss are historically known for being the classy alternative to launder and store your ill gotten gains from, for example, your stint as the dictator of an African country. But there has been some changes in recent years so I don't know how it is today.

The absolute peak of that was, of course, during WW2 when vast amounts of stolen or looted money, gold, and other valuables ended up being laundered through Switzerland and kept in anonymous accounts. Mostly by Nazis, although not exclusively. There was a long campaign of litigation by the descendants of Holocaust victims to get some of it back.

In the 21st century the US eventually pressured them into not being a tax haven for anonymous money hidden by US nationals.

The twin questions of tax and terrorism remain as pressure against money laundering.

Re: Squillions: How money laundering won

#74

Post by pjc50 »

mike_hearn wrote: post #66

I learned a lot about the AML system many years ago and still have some books about how it works on my bookshelf. It's fascinating stuff. A few minor comments. My wife and I have owned and used 1000 CHF notes quite a few times in the past. The last two times we moved apartments I paid part of the moving fee with a 1000 CHF note. We've also bought furniture this way. Nobody was surprised to see this and the notes were…

> You can't get any high value notes there, they just don't exist

Yes, although this is mostly by capping the highest regularly circulating note at £50 after the war and then waiting for inflation.

> And there's so much street crime,

[mostly false]

> and the police care so little about burglary,

Sadly true (including "find my iPhone" reports; there was a joke during the Mandelson scandal that this was the one time the Met had managed to locate a phone)

> The UK did this already and ML is out of control there: criminals just don't care.

Yes, which makes a sort of orthogonal point about whether or not cash is actually important for this. There's the conspicuously suspicious businesses ("American sweet shops"), but also more complicated stuff going on (Scottish Limited Partnerships were in the news). Then there's all the Crown dependencies, which are a total financial wild west still.

> Carousel fraud in the EU is a huge problem that governments hate to talk about because they don't know how to fix it

God yes. This is a significant problem in VAT as a concept; I don't understand why the EU loves VAT so much.

Re: Squillions: How money laundering won

#75

Post by pjc50 »

rwmj wrote: post #72
graemep wrote: post #70

Earlier quoted context omitted.

> As a result, governments continue to strengthen and expand laws in that direction. Which creates national security and sovereignty issues. Cash is robust and decentralised. There is a good reason Sweden went from pushing cashless to advising people to keep cash at home for emergencies, and were at least considering an obligation to accept cash for small transactions.

> Which creates national security and sovereignty issues Are you talking about people who don't pay tax? They create very large national security and sovereignty issues. Countries that don't collect much tax have real problems with both of these. > There is a good reason Sweden went from pushing cashless to advising people to keep cash at home for emergencies The key phrase being "for emergencies".

The national security and sovn. issues are when the US threatens to turn off the system, or starts sanctioning individual non-US nationals.

Re: Squillions: How money laundering won

#76

Post by pjc50 »

jcattle wrote: post #71
seanhunter wrote: post #42

Aside: The author of this article wrote a fantastic novel that not a lot of people know about called “The Debt to Pleasure”. One of the best instances of the “unreliable narrator” I’ve ever read.

Good to know, thanks! This article was such a breath of fresh air compared to the usual "LLM-assisted" writing you get. Just sentences like this: > This isn’t just a problem for far-off countries of which we know little, like the EU and the US and China. Here in the UK [...] So good! I feel like I'm becoming an old cynic but if it's the tenth time on the day that I read an overdramatized "It's not X, it is Y" in an a…

This is the London Review Of Books. They will be one of the last bastions of non-AI writing, because they actually care.

Re: Squillions: How money laundering won

#77

Post by marysol5 »

reconnecting wrote: post #67

The true crime is involving a multinational corporation in a transaction between two private individuals at the local market. I like cash because it's direct, and where possible I avoid paying by card because I don't want the merchant to pay fees to third parties. In Europe, most of the time, using cash doesn't imply avoiding taxes on the transaction, but having cash is essentially sovereignty .

FYI, handling cash has fees to "third parties" too.

In a lot of cases it's a lot higher than just taking card.

Re: Squillions: How money laundering won

#78

Post by marysol5 »

graemep wrote: post #70
arttaboi wrote: post #22

Here's an anecdotal thought: AML laws surprisingly work well to discourage offline transactions by tax-paying citizens, helping maximize tax reporting and improve tax collection. As a result, governments continue to strengthen and expand laws in that direction.

> As a result, governments continue to strengthen and expand laws in that direction. Which creates national security and sovereignty issues. Cash is robust and decentralised. There is a good reason Sweden went from pushing cashless to advising people to keep cash at home for emergencies, and were at least considering an obligation to accept cash for small transactions.

That's just a disaster planning POV. If you've ever been in a shop where the EPOS goes down, you'll know how chaotic it is. And that's just a macro scale.

Re: Squillions: How money laundering won

#79

Post by marysol5 »

Gigachad wrote: post #34
arttaboi wrote: post #22

Here's an anecdotal thought: AML laws surprisingly work well to discourage offline transactions by tax-paying citizens, helping maximize tax reporting and improve tax collection. As a result, governments continue to strengthen and expand laws in that direction.

It used to be super common for many small businesses to be cash only or a 10% discount for cash. Likely the main driver for this was tax avoidance. I haven't seen a cash only business since covid. With a dwindling number of legitimate cash users, any business that is pulling in huge sums of cash well beyond the average is going to look increasingly suspicious.

Still lots of builders/tradies in the UK who do "for cash".

Also lots of takeaways, they'll be on JustEat/Uber Eats and cash-only in store which is a PITA. My local chippy is cash only and no-delivery. I can't find a single record for a recorded business, or health rating either!

Re: Squillions: How money laundering won

#80

Post by marysol5 »

objclxt wrote: post #65
selfhoster1312 wrote: post #63

Earlier quoted context omitted.

> Likely the main driver for this was tax avoidance. It's not just that, though. It's common here in France for credit card operators to have fees in the 5-10% range (or 0.30€ per operation + 2% of the amount). That's why you often see signs « card accepted above 10€ », and that's why your local shop will probably not mind if you're missing 10 cents when paying cash.

> It's common here in France for credit card operators to have fees in the 5-10% range (or 0.30€ per operation + 2% of the amount) Interchange in the EU is capped at 0.4% for credit cards. Typical costs for processing are much lower than 5-10%. For example, Adyen charges the 0.4% interchange + their fee of 0.6% and a flat 0.11€. On a 10€ transaction, that's 2.1%. In most cases this is cheaper than handling cash. When…

Had a conversation with the landlord of my local pub a few years back, he said he'd go "Card Only" if it wasn't for the handful of patrons that refuse to use card, couple of which are the "Cash is King" Facebook types.

And he was paying his staff under the table in cash anyway! But would still rather just withdraw from the business account, rather than having to deal with handling of customer cash every day.

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