Another Bank Corruption Charge: Drug $$ Laundering

[boutons_deux]

U.S. officials ready to target banks over safeguarding failures: report

Major US banks are being investigated for insufficiently safeguarding against being used by drug dealers or terrorist groups to launder dirty money, it was reported Saturday.

An article in the New York Times suggested that federal and state authorities were ready to launch an aggressive crackdown on the failure to monitor transactions, in a move aimed at flagging to financial ins utions that weak compliance is unacceptable.

Officials told the Times that regulators are close to taking action against JP Morgan, while other firms including Bank of America are also being investigated over perceived shortcomings when it comes to putting a check on money-laundering activities.

It comes just months after a Senate committee roundly criticised HSBC for ignoring warning signs that it was being used by money launderers and drug cartels in Mexico.

US politicians also accused HSBC of cir venting US sanctions on countries including Cuba and Iran – a charge that has also been levied against JP Morgan.

http://www.rawstory.com/rs/2012/09/1...=Google+Reader


A Jaw-Dropping Explanation of How Governments Are Complicit in the Illegal Drug Trade

Lars Schall: What has been your main motivation to spend 10 years of your life to the subject of the drug trade?

Oliver Villar: The main motivation goes sometime back. I think it has to do firstly with my own experiences in growing up in working class suburbs in Sydney, Australia. It always has been an area that I found very curious and fascinating just to think about how rampant and persuasive drugs really are in our communities, and just by looking at it in more recent times how much worse the drug problem has become, not just in lower socio-economic areas, but everywhere.

But from then on, when I finally had the opportunity to do so, I actually undertook this as a PhD thesis. I spent my time carefully looking at firstly what was written on the drug trade, but as coming from Latin America, I was very interested in particular in the Latin American drug trade as well.

So I looked at the classic works such Alfred W McCoy's Politics of Heroin, Peter Dale Scott's Cocaine Politics, Douglas Valentine's The Strength of the Wolf, and works that related not just to the drug trade, but from various angles including political science perspectives to see what we know about drugs.

I found there were a lot of gaps missing, and there was a lot written on Asia, on Central America, particular from the 1980s, if you recall the Iran-Contra theme and scandal, but nothing really on where drugs actually come from. Eventually my research took me to Colombia, and in the Western hemisphere at least, cocaine became that subject of investigation. I looked at it from a political economy perspective, and so from there on you can kind of get an idea about some of the influences in my background in eventually taking that much time to do it.

LS: Does the drug trade work very differently than people usually assume?

OV: Well, yes. What do people usually assume? Well, it's a criminological subject of investigation, it's a crime approach, it's criminals, it's pretty much a Hollywood kind of spectacle where it becomes clear who the good and the bad guys are. But what I found, it's far more than just simply criminals at work.

What we do know, if you go back to the history of the global drug trade, which I did pursue, you find that states, not just individuals or criminals, were also part of the process of production and distribution. The most notorious example is the British colonial opium trade, where much of that process was happening in a very wide scale, where the British not only gained financially but also used it as a political form of social control and repression.

What did they do? In China they were able quite effectively to open up the market to British control. This is just one example. And from there on I looked at other great powers and the way they also somehow managed to use drugs as a political instrument, but also as a form of financial wealth, as you could say, or revenue to maintain and sustain their power. The great power of today I have to say is the United States, of course. These are some of the episodes and investigations that I have looked at in my new book.

LS: From my perspective as a financial journalist it is remarkable to see that you treat cocaine as just another capitalist commodity, like copper, soy beans or coffee, but then again as a uniquely imperial commodity. [1] Can you explain this approach, please?

OV: Again drawing upon past empires or great powers, it becomes an imperial commodity because it is primarily serving the interests of that imperial state. If we look at the United States for instance, it becomes an imperial commodity just as much as opium became a British imperial commodity in a way it related to the Chinese. It means the imperial state is there to gain from the wealth, the United States in this case, but it also means that it serves as a political instrument to harness and maintain a political economy which is favorable to imperial interests.

http://www.alternet.org/print/drugs/...gal-drug-trade


The Worst Is Ahead for Standard Chartered

Standard Chartered has paid the New York Department of Financial Services $340 million to settle charges that it helped Iran interests launder money. Unfortunately for the financial firm, this settlement is only the tip of the iceberg. Standard Chartered will face a series of related charges in both the United States, where federal officials have begun to examine the money laundering charges, and in the United Kingdom. BusinessWeek reports:

The cost of settling with all the regulators may be about $700 million, Cormac Leech, an analyst at Liberum Capital wrote in a note to investors today.

http://www.dailyfinance.com/2012/08/...ard-chartered/

Cocaine Cowboys Know Best Places to Bank

HSBC’s main U.S. regulator, the Office of the Comptroller of the Currency, for years tolerated its violations of anti-money laundering laws.

For this, HSBC and the OCC apologized. Justice Department fines are likely. It’s an outrage HSBC hasn’t had its U.S. banking licenses revoked, assuming the Senate panel’s report is accurate -- and there’s no reason to believe it isn’t.
Try This

Let’s try out a novel idea: Banks that help drug cartels launder money and give cover to those tied to terrorism should be put out of business. Is that really so hard for everyone to agree on? Free markets have worked in the U.S. because we have the rule of law. It’s why so many investors from other countries want to do business here. When contracts are breached, courts can be accessed to enforce them. When individuals or companies commit crimes, they’re supposed to be prosecuted and punished.

Except we have this mutant species of corporation called too-big-to-fail banks whose collapse might wreck the global economy. No financial ins ution in the U.S. can survive a felony indictment. So these companies have become un-indictable, creating a perverse nonchalance regarding financial crimes. In 2010, Wachovia paid $160 million to settle criminal allegations of laundering Mexican drug money. By then the bank had been bought by Wells Fargo & Co. (WFC), and the Justice Department let it off with a deferred-prosecution deal. Usually the most that happens to management is someone resigns, as HSBC’s head of compliance, David Bagley, said he would at last month’s Senate hearing.

http://www.bloomberg.com/news/2012-0...s-to-bank.html

With $100Bs sloshing around, who is so naive to assume THAT all the big hyper-complex, secretive US/Euro banks are not up to their ears in drug/rogue country money laundering?

[Winehole23]

In 2010, Wachovia paid $160 million to settle criminal allegations of laundering Mexican drug money.

Missed this y allegation at the time:

The conclusion to the case was only the tip of an iceberg, demonstrating the role of the "legal" banking sector in swilling hundreds of billions of dollars – the blood money from the murderous drug trade in Mexico and other places in the world – around their global operations, now bailed out by the taxpayer.


At the height of the 2008 banking crisis, Antonio Maria Costa, then head of the United Nations office on drugs and crime, said he had evidence to suggest the proceeds from drugs and crime were "the only liquid investment capital" available to banks on the brink of collapse. "Inter-bank loans were funded by money that originated from the drugs trade," he said. "There were signs that some banks were rescued that way."

https://www.theguardian.com/world/20...ico-drug-gangs