Photo:devan78, Creative Commons, Flickr
Trends return every twenty years, and in 2008, people are blowing like it's 1988. If you are in the party circuit, you might notice the white powder on somebody's nose, and it ain't powdered sugar.
Cocaine is back.
The Wall Street Journal highlights the new money laundering tactics that cocaine makers are using and maps out the lucrative industry from its origin of production to its money-laundering end. The drug is produced in South America and shipped to Europe via Africa until the money from trafficking ultimately reaches the United States. Due to the strength of the Euro, drug cartels have chosen Spain as a major hub for trafficking and money laundering.
The Journal uses the Mazza family operation as an example. In March 2007, Mauricio Mazza-Alaluf was arrested at Los Angeles International Airport with a duffel bag full of Euro banknotes. Chilean police began investigating the Mazza family in the summer of 2004 and identified them as a narcotics operation.
In looking at court documents, the reporters conclude that the money from the Mazzas operation eventually reached the United States at three banks: J.P. Morgan Chase (JPM) in Dearborn, Michigan; Israel Discount Bank in New York; and Harris Bank in Chicago. The fellas did it brazenly, too:
In opening each account, the Mazzas gave their company's real name and openly described it as a tourism and currency-exchange agency.
A 42-year-old party boy muses in his New York apartment:
If the cocaine business didn't exist, a lot of people will lose their jobs. People in third world countries who produce cocaine will lose their jobs. Law enforcement officers in a lot of countries will lose their jobs. Cocaine feeds a lot of people.
That doesn't mean it's good, that's just the way it is. There will always be people making, selling and taking drugs. The point here is for banks to notice and pick out the suspicious activities that lead to eventual arrest and indictment.
Site disclaimer
Photo: Devan78, Creative Commons, Flickr
Disclosure: I do not own shares of JP Morgan Chase.