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

Squillions: How money laundering won

lrb.co.uk

Post reply on HN
Print view View original

191–200 of 238 posts

Re: Squillions: How money laundering won

#191

Post by happymellon »

marysol5 wrote: post #77
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.

Its also really expensive for your time when dealing with it.

The only people who think it's cheaper are those that value their time at 0.

Re: Squillions: How money laundering won

#192

Post by titanomachy »

mercutio2 wrote: post #173
SkiFire13 wrote: post #151

Earlier quoted context omitted.

Most of your cash back money actually comes from fees that merchants pay. In the US and especially for credit cards with cash back those fees can be quite high, and unfortunately it's illegal for merchants to discriminate against credit cards with high fees.

This used to be true. But the 2025 Interchange Fee Settlement abolished the “Honor All Cards” regime. Perhaps, I know it’s crazy, but… perhaps segmenting the market into extremely high-spending customers, normal pay-every-month-relatively-low-fees, and no-frills, was a smart move by the big issuers? My sense is that alienating big spenders (whose interchange fees tend to be in the 4% range) is just not worth it? All…

Costco in the US has, for as long as I’ve shopped there, only accepted visa or debit.

Re: Squillions: How money laundering won

#193

Post by lxgr »

titanomachy wrote: post #190
lxgr wrote: post #182

Earlier quoted context omitted.

Interchange for debit and credit cards is now almost the same in Europe (0.2% vs. 0.3%).

Yeah it’s the US credit card fees that are the real problem. No reasonable person would argue that Visa should get to be a 3% tax on all consumer financial activity.

It's not as simple: Visa and Mastercard don't get the 3%; the issuing banks do.

But Visa and Mastercard effectively set the rates, and the higher they are, the more issuer business they get; meanwhile merchants are essentially never in a position to reject either Visa or Mastercard (notable exception Costco confirming the general rule), so market forces are pretty one-sided.

I think if Visa and Mastercard were three-party networks like Amex or Discover (now Capital One), their interchange would have long been regulated down by >90%.

Re: Squillions: How money laundering won

#194

Post by dmantis »

happymellon wrote: post #191
marysol5 wrote: post #77

Earlier quoted context omitted.

FYI, handling cash has fees to "third parties" too. In a lot of cases it's a lot higher than just taking card.

Its also really expensive for your time when dealing with it. The only people who think it's cheaper are those that value their time at 0.

Studies say otherwise: https://link.springer.com/chapter/10.1007/978-3-642-40654-6_...

Cash is actually faster in many cases, the 'slowness' is the matter of perception and the need to make a cognitive operation of 1st grader counting, which is apparently a daunting prospect for many people.

And even if it were slower by 20-30 secs, the advantage it gives in control and privacy is such enormous that I don't understand people who use banks at all.

The last thing other people should know is how, where, and when a person spends their money. And due to the AML surveillance from the discussed article the banking privacy is practically dead.

Re: Squillions: How money laundering won

#195

Post by titanomachy »

alberth wrote: post #135

> I haven’t even mentioned gold, which is used all the time in criminal transactions, let alone cryptocurrency, the single biggest recent innovation in money laundering . Curious how that line is received within the HN crowd.

I think it’s the best explanation for crypto’s apparent massive success. Crypto isn’t especially convenient to use, and for a lot of the popular coins transaction fees are quite high. There are certainly non-criminals who care a lot about privacy and don’t want to be surveilled, and while I’m sympathetic to that viewpoint, I think it’s a tiny minority of people who care enough to inconvenience themselves.

Yet, somehow, billions of dollars of value move through crypto. I wouldn’t be surprised if most of that activity is tax evasion and money laundering.

Re: Squillions: How money laundering won

#196

Post by lxgr »

Qem wrote: post #179
buran77 wrote: post #107

Earlier quoted context omitted.

What about the extra costs of handling cash, the practical effort to count it, prepare it for transport (including bags, counters, and so on), transporting to the bank, increased security, possibly more cash registers, counterfeit detectors etc.? Overall is it usually more expensive to take credit cards than cash or just in particular cases?

At least these are mostly local jobs.

Is inefficiency somehow better if it creates local jobs?

Re: Squillions: How money laundering won

#197

Post by happymellon »

dmantis wrote: post #194
happymellon wrote: post #191

Earlier quoted context omitted.

Its also really expensive for your time when dealing with it. The only people who think it's cheaper are those that value their time at 0.

Studies say otherwise: https://link.springer.com/chapter/10.1007/978-3-642-40654-6_... Cash is actually faster in many cases, the 'slowness' is the matter of perception and the need to make a cognitive operation of 1st grader counting, which is apparently a daunting prospect for many people. And even if it were slower by 20-30 secs, the advantage it gives in control and privacy is such enormous that I don't understan…

All of those talking points appear to be some preprepared copy pasta, because they don't appear to relate to my comment at all.

I never spoke about speed.

> the need to make a cognitive operation of 1st grader counting, which is apparently a daunting prospect for many people.

Don't be a condescending prick. The fact that counting exists at all is a cost that people don't measure.

> due to the AML surveillance from the discussed article the banking privacy is practically dead.

Or if you read the fine article you would realise that AML rules generate so much noise that there isn't any analysis.

Re: Squillions: How money laundering won

#198

Post by lxgr »

elteto wrote: post #131
akomtu wrote: post #127

Earlier quoted context omitted.

Don't you pay 3% of every purchase to your credit card?

Most of the time it’s the other way around, at least in the US: because cash and credit card prices are almost always the same it is the cash users who are overpaying, to the tune of 2-3% of the purchase price. It makes no sense to use cash.

Sure, but somebody is still paying more in aggregate than what you get out as rewards, or this industry would not exist.

Re: Squillions: How money laundering won

#199

Post by lxgr »

IncreasePosts wrote: post #128
akomtu wrote: post #127

Earlier quoted context omitted.

Don't you pay 3% of every purchase to your credit card?

No? There's zero % interest for every purchase if you pay for it fully the next billing cycle

Yes, but consider who pays the merchant fee in the end. Sure, you might be getting a kickback of that in rewards, but usually less than you pay yourself in fees indirectly.

Re: Squillions: How money laundering won

#200

Post by reconnecting »

titanomachy wrote: post #190
lxgr wrote: post #182

Earlier quoted context omitted.

Interchange for debit and credit cards is now almost the same in Europe (0.2% vs. 0.3%).

Yeah it’s the US credit card fees that are the real problem. No reasonable person would argue that Visa should get to be a 3% tax on all consumer financial activity.

Customer...

French companies pay social contributions (~45% of the full salary) via Visa and MasterCard, and the French authorities are making it nearly impossible to pay these by wire transfer.

Post reply on HN