Can Somone Explaine to me what Money Laundering is

[Scrooge2]

You should ask the black door to door magazine salesman =)

 

[Injury]

It's basically getting rid of money in a manner in which it will come back to you. This money, of course was obtained illegally, and the purpose is to prevent it from being traced back to you.

If it were me, I'd buy a bunch of electronics and just ebay them or something.

 

[DrPizza]

Suppose you owned a laundromat. How would anyone know how much money you actually took in? Thus, you could sell drugs from a back room, and still manage to document that income. Or, Bob could be selling the drugs, and fixing your washing machines. He could give you the money and you could give it back to him as pay for fixing the machines. Of course, you as the owner of the laundromat, would get to keep a little cut, in payment for your efforts.

Al Capone - convicted of tax evasion. If you're going to do something illegal and make hundreds of thousands of dollars doing it, it's pretty difficult to actually use that money without a few people wondering where it's coming from. Go ahead, try to buy a Ferrari - it's going to bring up red flags all over the place. But, in the laundromat case above, the money appears to be legitimate income for which you paid taxes. (Of course, a mobster would still conceal some of the income from the IRS - But it would be stupid to conceal 100% of it and expect not to get caught.)

 

[axelfox]

Originally posted by: acemcmac
Office Space :laugh:

"lets look it up in the dictionary"

Damn, beat me to it.

"To channel between an intermediary . . . . "

 

[JS80]

Money LAUNDERing:
1) Print counterfeit monies
2) Since they look too new, you need to make it look old
3) Put it in the LAUNDRY
4) Congrats you have just laundered monies.

 

[alkemyst]

Mall Kiosks: How many $5 foam gliders, head massagers, etc are they selling to pay the $5000/month + % of profits rent?

Since it can be a predominantly cash business they simply trash more merchandise than they sell and report it as earnings.

 

[pinion9]

Originally posted by: alkemyst
Mall Kiosks: How many $5 foam gliders, head massagers, etc are they selling to pay the $5000/month + % of profits rent?

Since it can be a predominantly cash business they simply trash more merchandise than they sell and report it as earnings.

WTF are you talking about? How is that laundering? How does trashing merchandise increase profits? Are you implying that they are receiving illegal money?

Oh, for the record, you would need to sell at least 1000 $5 items to make the $5000 rent.

 

[Stuxnet]

Originally posted by: IcebergSlim
ANother common one is the crack game disguised as rap. Crack dealers use profits and open "recording studios" and the Open "record labels" and sign "artists"

Again there may be legitamate money being exchanged for use of a studio or when an artist performs or from cd sales. But how easy would it be to set up a deal to go down in the studio and write it off as producing a new track. For instance gangsta a is buying crack from the studio owner. The studio own marks off tuesday as the day the deal will go down. When doing his book keeping he writes down that he charged gagsta a $10,000.00 for use of the studio for the day. Gangsta A comes in the studio lays down some vocals and get handed the drugs. Gangsta A hands over the cash. That cash IS CLEAN to the eyes of the govt. The label Takes the track that Gangsta A records and publishes a cd. The label writes off the costs of the printing the cd and then lies about about how many cds it sold. further creating more clean money for future deals.

its actually pretty smart.

Finally. A plausable explanation for how the fsck rap successfully got off the ground.

 

[pinion9]

Wow, there are a lot of people on here who have no idea what money laundering is.

1) It is a metaphor. It has nothing to do with making counterfeit money look old.
2) The money in question need not be obtained illegally.
3) It is simply a term used for actions that conceal the source or destintation of money.

This would include small business owners that skim (e.g. pocket every 10th transaction and not report it), those who wish to evade taxes, drug dealers who want the appearance of legitimate income, etc.

 

[preslove]

Restaurants are also often used to launder $. Open up a nice place that breaks even or loses a little cash + inflate your sales on the books with drug $ = "legal" money that you can pay your mortgage with.

 

[Stuxnet]

Originally posted by: pinion9
1) It is a metaphor. It has nothing to do with making counterfeit money look old.

Yes it does. It's where the term came from, and the person who brought it up even stated as much.

Counterfeiters would literally put the conterfeit paper through the laundry to make it feel/look more authentic. Always flashing clean, crisp bills is not only suspicious, but it's more difficult to spot a fake if it's been to hell and back.

 

[AbsolutDealage]

How is it that all these stupid, Neanderthal, Mafia guys can be so good at crime and smart guys like us can suck so badly at it?

 

[vi edit]

Originally posted by: DrPizza
Suppose you owned a laundromat. How would anyone know how much money you actually took in? Thus, you could sell drugs from a back room, and still manage to document that income. Or, Bob could be selling the drugs, and fixing your washing machines. He could give you the money and you could give it back to him as pay for fixing the machines. Of course, you as the owner of the laundromat, would get to keep a little cut, in payment for your efforts.

Al Capone - convicted of tax evasion. If you're going to do something illegal and make hundreds of thousands of dollars doing it, it's pretty difficult to actually use that money without a few people wondering where it's coming from. Go ahead, try to buy a Ferrari - it's going to bring up red flags all over the place. But, in the laundromat case above, the money appears to be legitimate income for which you paid taxes. (Of course, a mobster would still conceal some of the income from the IRS - But it would be stupid to conceal 100% of it and expect not to get caught.)

I always thought those "cash only" car washes would be a viable way to blur the line between valid and invalid income.

Really, how do they account for things? Did they do $100 in business that day, or $1000? It's all cash. No real inventory short of water and some of the detergents & wax. Very little labor. Seems like an easy way to do things.

 

[vi edit]

Originally posted by: AbsolutDealage
How is it that all these stupid, Neanderthal, Mafia guys can be so good at crime and smart guys like us can suck so badly at it?

Because you never see or hear about the smart ones. And that's how they prefer it.

 

[Stuxnet]

Originally posted by: vi_edit

Originally posted by: AbsolutDealage
How is it that all these stupid, Neanderthal, Mafia guys can be so good at crime and smart guys like us can suck so badly at it?

Because you never see or hear about the smart ones. And that's how they prefer it.

He was quoting Office Space, not asking a real question.

 

[vi edit]

Originally posted by: jbourne77

Originally posted by: vi_edit

Originally posted by: AbsolutDealage
How is it that all these stupid, Neanderthal, Mafia guys can be so good at crime and smart guys like us can suck so badly at it?

Because you never see or hear about the smart ones. And that's how they prefer it.

He was quoting Office Space, not asking a real question.

Ah damnit. I almost never miss an Office Space quote. I need to re-educate myself tonight

 

[RossMAN]

http://www.fdic.gov/regulations/examinations/bsa/index.html

http://www.occ.treas.gov/sar.htm

 

[Stuxnet]

Originally posted by: vi_edit

Originally posted by: jbourne77

Originally posted by: vi_edit

Originally posted by: AbsolutDealage
How is it that all these stupid, Neanderthal, Mafia guys can be so good at crime and smart guys like us can suck so badly at it?

Because you never see or hear about the smart ones. And that's how they prefer it.

He was quoting Office Space, not asking a real question.

Ah damnit. I almost never miss an Office Space quote. I need to re-educate myself tonight

You know what, I think I should too. Just to be safe, you know.

 

[alkemyst]

Originally posted by: pinion9

Originally posted by: alkemyst
Mall Kiosks: How many $5 foam gliders, head massagers, etc are they selling to pay the $5000/month + % of profits rent?

Since it can be a predominantly cash business they simply trash more merchandise than they sell and report it as earnings.

WTF are you talking about? How is that laundering? How does trashing merchandise increase profits? Are you implying that they are receiving illegal money?

Oh, for the record, you would need to sell at least 1000 $5 items to make the $5000 rent.

You ride a short bus or something. For one selling the 1000 $5 gliders will not net you $5000 for the rent. There is a % of that that goes to the mall as well, then you have staffing, any business bills, and finally the cost of the gliders themselves.

The gliders are an example to BTW...but yes at least around here there is a big concern that these businesses are laundering money that came from illegal sources.

 

[tweakmm]

Originally posted by: IcebergSlim

Originally posted by: rgwalt
For most small time people, like local drug dealers (think weed here), the people open up a legitimate business and actually hire a couple of people. A common one is a lawn care service, since they "cut the grass". The idea is that the service does a small amount of legitiment work, enough to pass unnoticed, but claims some or all of the revenue from drug sales as profit, which is then reported to the IRS and can be deposited in the bank. So, you end up paying taxes on the money, but the money is "clean". That is, you don't have to conduct all your transactions in cash, and you don't have to explain the source of the money itself.

R

ANother common one is the crack game disguised as rap. Crack dealers use profits and open "recording studios" and the Open "record labels" and sign "artists"

Again there may be legitamate money being exchanged for use of a studio or when an artist performs or from cd sales. But how easy would it be to set up a deal to go down in the studio and write it off as producing a new track. For instance gangsta a is buying crack from the studio owner. The studio own marks off tuesday as the day the deal will go down. When doing his book keeping he writes down that he charged gagsta a $10,000.00 for use of the studio for the day. Gangsta A comes in the studio lays down some vocals and get handed the drugs. Gangsta A hands over the cash. That cash IS CLEAN to the eyes of the govt. The label Takes the track that Gangsta A records and publishes a cd. The label writes off the costs of the printing the cd and then lies about about how many cds it sold. further creating more clean money for future deals.

its actually pretty smart.

Practically every rap label was started with crack money.

The true rock stars. :laugh: