London: The Money-laundering Capital of the World

Michael Lambert explains.

US Seizes $3.6 Billion in Cryptocurrency Linked to Bitfinex Currency Exchange Hack | DW News

Feb 9, 2022 • The United States Justice Department said on Tuesday that authorities seized more than $3.6 billion (€3.2 billion) and arrested a New York couple accused of conspiring to launder billions in cryptocurrency.

Federal law enforcement officials said the recovered sum was linked to the hack of the Bitfinex virtual currency exchange in 2016. This was the department's largest seizure to date. The two suspects were arrested in Manhattan on Tuesday morning. They are accused of using sophisticated techniques to launder the stolen money and conceal the transactions. The couple is scheduled to make their initial appearances in federal court later on Tuesday. They face federal charges of conspiracy to commit money laundering and conspiracy to defraud the United States.

In the 2016 hack, about $71 million in stolen bitcoin was transferred to an outside digital wallet, officials said. The stolen bitcoin is valued today at more than $4.5 billion (€3.9 billion). Investigators located a wallet containing more than 2,000 bitcoin accounts and followed the trail to accounts at a dark web marketplace called AlphaBay. The marketplace was dismantled by the Justice Department in 2017. Authorities said they obtained access to files within an online account controlled by Lichtenstein, which contained the private keys to the wallet that was used to receive and store bitcoin stolen in the 2016 Bitfinex hack. The keys allowed agents to lawfully seize and recover more than 94,00 bitcoin, the Department of Justice said in a statement. Authorities say they tracked the stolen funds to more than a dozen accounts controlled by Lichtenstein, Morgan and their businesses. Millions of dollars were cashed out through bitcoin ATMs and used to purchase gold, non-fungible tokens (NFTs) and Walmart gift cards, prosecutors said.

he City of London Is Hiding the World’s Stolen Money

Toby Melville/Reuters
OPINION: GUEST ESSAY
THE NEW YORK TIMES: In 1969, two years after the Cayman Islands, a British territory, passed its first law to allow secretive offshore trusts, an official government report struck an ominous note. A tide of glossy propositions from private developers, it warned, was washing through the islands. Cayman was fast becoming a state captured by shady finance.

Those were the pungent beginnings of a modern system brought to light by the Pandora Papers, an enormous data leak coordinated by the International Consortium of Investigative Journalists. The papers exposed a smorgasbord of secretive and questionable financial dealings by more than 330 politicians and public officials from over 90 countries and territories — and over 130 billionaires from Russia, the United States and elsewhere. On display was a dizzying array of chicanery and wealth hoarding, often by the very people who should crack down on it.

The revelations, published on Oct. 3, are global in scope. But if there is one country at the system’s heart, it is Britain. Taken together with its partly controlled territories overseas, Britain is instrumental in the worldwide concealment of cash and assets. It is, as a member of the ruling Conservative Party said last week, “the money laundering capital of the world.” And the City of London, its gilded financial center, is at the system’s core. For Britain, whose bloated financial sector exacerbates widespread economic problems, that’s bad enough. For the world, at the mercy of an economic system rigged for the rich, it’s even worse. » | Nicholas Shaxson | Monday, October 11, 2021

FinCEN Money Laundering Leaks: Deutsche Bank Is Under Fire | DW News

Germany's largest bank Deutsche Bank is no stranger to scandals. But the leaked FinCEN files suggest the bank was aware it was facilitating suspicious transactions amounting to over $1 trillion dollars, including for a period after it had promised to clean up its act. Deutsche Bank accounts for 62% of all Suspicious Activities Reports (SARs) filed to FinCEN in the leaked documents.

Between 1999 and 2017, $2 trillion (€1.68 trillion) in transactions were flagged by financial institutions' internal compliance officers as suspicious. Reasons include possibly money laundering, sanctions violations or other criminal activities. Of these, $1.3 trillion (€1.09 trillion) worth of transactions passed through Deutsche Bank, which reported the activities to FinCEN. This is not the first time Deutsche Bank has been implicated in suspicious money transfers. In 2015 it agreed to a $258 million fine for violating US sanctions. A probe by US and New York banking regulators found the bank had moved $10.9 billion (€9.2 billion) on behalf of Iranian, Libyan, Syrian, Burmese and Sudanese financial institutions sanctioned by the US between 1999 and 2006. The bank was accused of carrying out transactions for its customers using "non-transparent methods and practices" to disguise its actions.

Deutsche Bank has been penalized many times in the past for facilitating suspicious activities. So why would they continue even after the hefty penalty of $258 million in 2015? For Tim White, a consultant at AML Right Source, an anti-money laundering consulting firm, the answer is simple: Money. White says that "by going ahead with these suspicious transactions, banks are making more money than the possible cost of the violations."

Free Ports Favoured by Boris Johnson Are Money-laundering Threat – EU

THE GUARDIAN: European commission warns against Singapore-style tax-free zones backed by incoming UK PM

The Singapore-style tax-free zones favoured by Boris Johnson have been identified as a money-laundering threat by Brussels.

In a report on money laundering, the European commission named free ports for the first time as a concept “potentially vulnerable to money laundering or terrorism financing” in the European single market. “Golden passport” schemes promoted by some EU countries, professional football and private ATM machines were also put on the commission’s watch list, which totals 47 goods and services.

Free ports are “the new emerging threat”, said the European justice commissioner, Věra Jourová. “This is something we want to focus more on.” » | Jennifer Rankin in Brussels | Wednesday, July 24, 2019

Money Laundering Fears for Virtual Currency Bitcoin - BBC News

The digital currency Bitcoin has been making headlines this week after a huge increase in value, but ministers are to introduce tighter regulations on the virtual currency over concerns it is being used to launder money and dodge tax. Daily Politics reporter Emma Vardy looks at how some MPs believe the government should help bring digital currencies into the mainstream, and say it could have advantages for public services.

‘Kleptocracy Tour’ Highlights London Money Laundering

It's the side of London many prefer to ignore.

Anti-corruption campaigners in the British capital have organised a bus tour designed to expose money-laundering by foreigners.

Al Jazeera's Neave Barker has been on the latest trip focusing on Nigerian money in London.

Senate Report: HSBC 'Allowed Drug Money Laundering'

BBC: A US Senate probe has disclosed how lax controls at Europe's largest bank left it vulnerable to being used to launder dirty money from around the world.

The report into HSBC, released ahead of a Senate hearing on Tuesday, says huge sums of Mexican drug money almost certainly passed through the bank.

Suspicious funds from Syria, the Cayman Islands, Iran and Saudi Arabia also passed through the British bank.

HSBC said it expected to be held accountable for what went wrong. » | Tuesday, July 17, 2012

Fraud Investigators Raid BAE Agent's Austria Home
THE GUARDIAN: Serious Fraud Office investigating allegations of bribery and money laundering

British investigations into BAE, Britain's biggest arms company, appear to have revived today after it was disclosed that a key BAE agent has been raided.

Investigators from the Serious Fraud Office arranged for the agent, Count Alfons Mensdorff-Pouilly, to be raided in Austria.

Austrian prosecutors said the raids were carried out at the request of the SFO investigating allegations of bribery and money laundering.

The Austrian police seized a quantity of documents from the home and office of Mensdorff-Pouilly, who has been accused of receiving millions of pounds from BAE for promoting deals. He is the Viennese laird of a Scottish castle.

The SFO's investigations into BAE have been controversial as the government stopped its inquiry into Saudi arms deals. Critics have alleged that the government is soft on BAE and has placed the company above the law and effectively made it immune from prosecution - an accusation denied by ministers. Fraud Investigators Raid BAE Agent's Austria Home >>> Rob Evans | September 30, 2008

REUTERS:
RPT-Austria Raids Lobbyists in Jetfighter Bribery Probe >>> | September 30, 2008

WALL STREET JOURNAL:
Police Look for Bribery Evidence in Case Against BAE >>> By David Crawford and Daniel Michaels | October 1, 2008

THE TELEGRAPH:
Austrian Addresses Visited in BAE Serious Fraud Office Probe: Police in Austria have visited a number of addresses as part of a UK Serious Fraud Office (SFO) investigation into claims that defence company BAE Systems was involved in bribery to secure aircraft contracts in the Czech Republic and Hungary.

The police visited the Austrian home and office of Count Alfons Mensdorff-Pouilly, a lobbyist who owns a castle in Perthshire.

The SFO is thought to have asked the Austrian authorities for help with its continuing probe into the defence company. The lobbyist's lawyer, Harald Schuster, said any allegations of wrongdoing were groundless.

Despite abandoning its investigation into BAE's dealing with Saudi Arabia, the SFO has continued to look at the company's defence contracts in other countries, including South Africa and Tanzania. >>> By Russell Hotten | October 1, 2008

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