by Jamie Redman
Mar 11, 2019
Some of the most well known banks in the world are also the biggest
The recent Troika Laundromat affair added another
$8 billion to the trillions financial institutions wash every year.
Over $2 trillion is laundered annually by criminals who utilize
various ways to hide money in banks, which are often complicit or at
least willing to turn a blind eye.
The following is a look at money
laundering schemes used by criminal enterprises that use the world's
so-called 'regulated' banks as their main laundromat system.
The World's 'Regulated' Banks Wash More Than $2 Trillion Every Year
Financial incumbents and politicians love to invade normal people's
everyday activities and they'd love to know how our funds are being
spent right down to the last penny.
At the same time,
system that they regulate is used to wash trillions each and every
year using schemes like,
...to hide funds that stem from
In the last decade, few notable bankers or financiers
have been jailed for financial crimes and money laundering save for
Many believe Madoff was only
incarcerated because he
stole from the banking cartel and shed light on their shady
Washing Money Using Banks
Since the last financial crisis, dozens of the world's financial
institutions have been caught laundering money and slapped with
Just recently the
Troika Laundromat scandal revealed
that banks like,
criminals wash $8.8 billion in a seven-year period.
are moved and obfuscated from the public eye using the traditional
banking system in a variety of ingenious ways.
Mirror trading is a financial strategy that is legal in certain
The mirroring method allows two identical trades to
be executed, but the selected strategy of the two combined trades
cancels each other out.
However, funds are still moved from one
location to the next using the scheme.
As one Quora commenter
A client opens up a trading account with Deutsche Bank in Moscow.
The client deposits let's say the equivalent of $10,000 in rubles in
his account and asks the bank to buy that amount of blue chip shares
on the Moscow stock exchange.
The client has previously instructed
the bank that the same shares are sold on the London stock exchange
for GBP; both trades are executed within fractions of a second of
Voila. Clean as a whistle...
Back in 2017, Deutsche Bank paid more than $670 million in penalties
for participating in
mirror trades that stemmed from illegal
activities in Russia.
Money laundering scandals have proliferated at
Deutsche Bank and the institution has paid more than $9 billion in
fines since 2008.
Many other well-known financial institutions have
been caught assisting mirror trading offenses like,
Bank of America
Another popular move by banks is a method of laundering money known
as 'structuring' or 'smurfing.'
This involves conducting a large
number of small transactions through a regulated bank, usually in a
specific pattern to avoid triggering anti-money laundering alarms.
Lots of banks located around the world have been caught smurfing or
allowing customers to smurf.
For instance, in 2017 the
was accused of 53,700 structuring related instances
by Australia's financial watchdogs.
In 2015 the Supreme Court in
charged the Canadian Imperial Bank of Commerce for
assisting such transactions and there are countless other financial
institutions that are simply dubbed "smurf banks."
When people want to move shady money, lots of times they set up a
fake business in order to hide the illegal proceeds.
occasions, there are businesses that actually have operations like
selling goods and services to obfuscate the illicit funds.
often, individuals set up 'shell' companies, which are basically
incorporated or limited liability firms only on paper with no real
operation inside them.
According to the group of journalists who unveiled the Troika
Laundromat scandal, roughly 75 shell firms were created to help
facilitate the process.
In the spring of 2017, it was also revealed
that about 21 shell companies were involved in a
scheme that took place between 2010 and 2014 that involved washing
$21 billion in illicit funds.
That particular escapade involved the
use of the world's top 50 banks including,
Bank of China
Royal Bank of Scotland
Legitimate and Illegal Business Mixing
Just like the shell company example above, many banks have assisted
people in mixing 'dirty money' with legitimate business practices.
There are all types of sanctioned businesses people use to mix
illegal funds with an authorized entity and one of the biggest
schemes uses real estate.
Many well-known financial incumbents have
been caught red-handed assisting with the mixing of real estate
sales and illegal proceeds.
Selling properties and the real estate market, in general, is less
scrutinized and in 2018 Denmark's largest bank was
accused of mixing
clean and dirty money through the sale of properties.
criminals and politicians use banks to launder money is through the
use of casinos and legal gambling.
Back in 2014, the Department of
Justice's (DoJ) "Operation Choke Point"
subpoenaed 50 banks in a
casino money laundering ring in Las Vegas.
The DoJ explained that
J.P. Morgan Chase & Co
Bank of America,
...were among the financial institutions involved.
While the Banks Wash Trillions and Get Slapped With Paltry Fines
...Law Enforcement Focus on Petty Cash and Bitcoin Sales
Financial regulators and law enforcement agencies around the world
seem obsessed with busting normal people for moving small amounts of
Police and 'three-letter agencies' dedicate a lot of energy
toward ordinary citizens who move bitcoin or petty cash, but allow
bankers to wash trillions without jail.
Last year Rustem Kazazi, a
U.S. citizen, had
his life savings stolen ($58,100) from law
enforcement and the TSA and Border Patrol at Cleveland Hopkins
International Airport never charged him with a crime.
In May 2017,
entrepreneur Sal Mansy of Detroit, Michigan was
charged by the DoJ
and the District of Maine for selling bitcoins in an unlicensed
In fact, many Localbitcoins sellers
have been prosecuted in
the U.S. for being an illegal money transmitter and hit with money
Unfortunately, the world's bureaucracy continues to focus on banning
cash and claiming cryptocurrency's main form of use is money
In reality, the
central banks' fiat money with
currencies like the U.S. dollar and Japanese yen are the main
vehicles for hiding shady funds.
The status quo's banking
institutions are the main facilitators of these crimes and the
magnitude of money they hide eclipses the entire cryptocurrency
market cap by a long shot.