Crypto Capital Laundry
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When we talk about Money Laundering, these "geniuses" have found in these failures a way to introduce into the legal financial system, enormous amounts of money from illicit sources (generally the product of drug trafficking and corruption) which should be monitored by the authorities. In fact, most of the time the authorities would be looking for tax evasion (You know, the coveted taxes).
Why do criminals need to make their money legal?
Accumulation.
Generally, the money from drug trafficking is handled in cash. We are talking about the most lucrative economic activity in the world.
By talking about 6 or 7 figures regular cash income, we would be referring to a situation where you couldn't get rid of that money fast enough.
Keeping it in a safe in your house, would imply a potential theft. If you need to take a trip or go live in another country, you could not take it with you.
You couldn't buy a new car or a big mansion without drawing the attention of the authorities.
Placing it in the bank through multiple small deposits is also not an option, you would be committing a federal crime called "Structuring." In fact, people have been convicted of structuring ... simply for making large cash deposits. With absolutely no connection to drugs or other illegal conduct.
In short, there are many systems dedicated to tracking illicit enrichment, so very little is worth 100 million dollars cash in a safe if you can not spend them.
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What does a "Bleaching" genius do?
Perhaps you will start by acquiring a legitimate business, one that handles cash transactions. Just for example, let's say a pawn shop. At the end of the day you take your cash deposit to the bank and deposit it in the commercial account of the business. Your accountant records the income. You pay your taxes for it. Bingo!
But when the flow of money from illegal activity far exceeds the limit that your legal business can generate daily, you fall back into the problem of accumulation.
It would take thousands of pawnshops, thousands of testaferros to hide so much money. Maybe you could spend years doing this activity successfully, but the time will come when you won't be able to hide it anymore.
The creation of Ghost Businesses is another method of money laundering.
Public limited companies can be created in tax havens such as Switzerland and the Cayman Islands.
Once the company is created, it can create false transactions such as payment for goods and services that are paid for with its dirty money.
They can also turn to the stock market, applying a technique called "mirror trading."
In this method you use your dirty money to buy shares, then you self-sell your shares for the same amount somewhere abroad. The transactions functionally cancel each other, but at the end of the round, you have converted your dirty dollars into clean Rubles.
The new era: Crypto-Laundering
In 2015 the movie "Dope" was released, where it was shown how Bitcoin was used for the sale and purchase of drugs without a trace.
BTC Mixer
The main method of laundering money from cryptocurrencies is using "mixers" services, which take virtual currencies from different clients and deposit them in a "pool", moving them from one point to another to confuse their origin.
These services are called mixers, turners, nebulizers, and laundries. They capture funds from multiple clients, mix those funds, and then issue the mixed funds. They generally charge between 1% and 3% per transaction for their services.
The key to this “mixer” is that it does not request information from any account or any personal information at the time of making the transaction and, in addition, it does not keep any record of the activities carried out by its visitors.
Anonymity is the main attraction that this service offers.
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Hi, I'm reading your post and it's interesting to hear about money laundering. I have been quite close to this modality, I even worked in a small business where the owner owned a BMW and a Mercedes Benz, then I found out that he was the front man for a very high ranking character in my country. It's not unusual for that to happen and I think this country is a giant money launderer.
I also heard once that in order to launder money through cryptosystems, you had to go through a bank to get it. However, sometime someone came to me to look for a BTC seller in this country because he had a buyer with a lot of dollars in cash (I am talking about 6 digits) and we know that in Venezuela, it is not very normal for this to happen so all the alarms went off and I said to myself: "this smells like money laundering", I did not want to go into that business and I simply said that I did not know anyone. 😑
Very good your contribution, unfortunately everything has its pros and cons.
Cheers!
You can notice that in my publication I did not refer to our country.
This is an open secret in Venezuela. Government representatives commit money laundering daily, as a result of the robbery of the nation's coffers, illegal mining, corruption in general and, above all, drug trafficking.
We are protected by a narco state, that is the reality and it is impossible to hide it.
Thank you for your contribution to my publication, valuable comments.
Money laundry seems to be very very trending game for the politicians and some criminals just to embezzle and accumulate more money through cunning and illegal means just as you've stated. I personally don't know why we have people delving into such dirty game just to make money. The astonishing part of it all is that there are great influencers and celebrities also engaging in such insecure activities just to make more money.
I'm actually hearing about crypto laundry for the first time though the use of cryptocurrency. This is something really bad and dangerous in the crypto space.
But there are times whereby some legit investors or traders also convert other cryptos to BTC... Should we say they are engaging in crypto laundry too? I need your view on this.
Thanks for sharing this great post with love from @hardaeborla and I hope you have a great day ahead ❤️💕❤️💕❤️
We must remember that when we talk about "Bleaching" or money laundering, we are referring to money from illegal sources.
When we exchange crypto, we do so freely and it does not represent any illicit. As long as the provenance is legitimate.
Since cryptography offers many advantages in terms of anonymity which is exploited by criminals, international organizations have been created such as the cybersecurity startup Chainalysis, dedicated to the use of blockchains such as Bitcoin to prevent human trafficking or child abuse, to just like the Internet Watch Foundation (IWF).
But detected or "tracked" cases represent a minimal percentage of total illegal operations.
In the case of Venezuela, for me it is quite worrying that the government is trying to implement a government cryptocurrency, since the allegations of corruption and drug trafficking that weigh on the main characters of the national administration suggest that they could incur money laundering.
Check it out, bro, that open-and-shout secret thing is in a lot of places.
I am in Colombia, here it is known that most of the department stores and supermarket chains are owned by a few families, generally linked to politics and drug trafficking. The whole town knows this, but nobody reports anything, because if they do, they can be disappeared... it happens frequently, and obviously these businesses are for money laundering, they also know this, but nobody says anything. It's a big problem this, I think Latin America is full of it. Unfortunately. We can only wash the money we have left in our pockets when we put them in the washing machine he he he
Brother, imagine what it will be like here in Venezuela.
I lived until last year in the Monagas state. That state is named after being the cradle of a very famous government representative.
Well, there you can hear thousands of stories about this man, who is practically the owner of all the companies, farms and commercial premises.
Everyone knows this is to launder all their dirty money.
Yes, this is unfortunate, but it is a reality, as I tell you, it is a widespread practice... Sadly.
Saddly.
The first part of your post reminded me of the TV series Breaking Bad where they use the car wash as a cash-based business for laundering their cash.
The more modern Bitcoin mixer is probably a better way as I am sure that a real business will eventually be found out. Also, with more secure cryptocurrencies like Monero it is very difficult to track the source of a transaction.
In fact I was inspired by a Quora participation where the author cited a car wash. It would be that he did it based on Breaking Bad?
Man, I have never heard about anything like this. ANd I am glad to it, because it would be illegal. However, it is still interesting to learn about how people in the "dark" world operate and use their skills and knowledge to make dirty money clean.
Human intelligence is best expressed when it is used for illegal things.
I once read a publication about how the crypto system could be used as a means for theft,our dear crypto system has very good values but unfortunately it can also be used for theft.
Well, theft is something else.
The theft cases that I have known are those scandals that have occurred in certain exchanges where users' money was lost.
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