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Money Laundering. For those who may not be familiar with what it is or how it works, here is a simplified explanation. When criminals make money either directly from their criminal activities, or because of such activities, the money is usually considered ‘dirty money’. Has anyone seen the TV series - Ghost? Forgive me for going off on a tangent. Common categories include money from activities such as: sale of drugs like cocaine, human trafficking, sex trafficking, gang-related activities, etc. Other less-mentioned categories but equally illegal and dishonest include money from creative accounting, corporate corruption, ransomware, securities fraud, Ponzi schemes, corrupt governments, fraudulent public office holders, etcetera. When perpetrators from these categories now wish to spend their ill-gotten wealth, they resort to seeking out ways to ‘clean’ their ‘dirty money’. This refers to transitioning their illegal money to become legal money. This is where money laundering comes in, as one of such transitioning process. It involves the re-introduction of ‘dirty’ money back into the economy as ‘clean’ money. Got it now? Good.
Money laundering has been around for almost as long as money itself. However, the past couple of weeks have seen a lot of skewed narratives from banks, governments, and other anti-crypto persons or groups. These narratives whether intentionally or unintentionally, would have the average person on the street like you and I, believing that money laundering is in the picture now, because of crypto. Really? Who is kidding who? Atleast, I can understand why the eccentric billionaires and constantly scheming politicians and corporations, with their self-serving agendas would want to skew the narrative. But the banks too? This is where ridiculousness meets shallowness.
Even history bears testament to the fact that some of the biggest money laundering cases in this century and the last, have involved some of these banks, not as victims, but as perpetrators! For example, check out the case of HSBC in 2012. A US Senate report disclosed that HSBC was involved in ‘activities’ violating AML laws. An estimate of about $8 billion dollars was laundered. Not to forget the case of Standard Chartered that helped a government to launder almost $250 billion. Then, there is the case of the US Wachovia Bank. The bank tried to silence the whistle-blower Martin Woods by reprimanding him for shining a light on the bank’s suspicious transactions with CDCs and lack of KYC. The bank’s activities led to a $160 million fine in 2007. Again, there is the case of Danske Bank - the largest scandal in Europe, that only came to light on the international scene in 2018 but started as far back as 2007. It was reported that even the executive board of the bank was aware and complacent. About $200 billion was laundered and even Deustche bank was reportedly implicated and is currently under investigation. You can read accounts here and here.
When it comes to the case of governments, the Basel AML Index, an independent index by the Basel institute of Governance is used for assessing and ranking risk of money laundering and terrorist financing for 141 countries in the world. According to this index’s regional ranking, Belgium, Cyprus, Malta, Netherlands, Spain, and the UK are listed as significant money-laundering destinations in the European Union and Western Europe region. In East Asia and the Pacific, almost half of the countries are listed as major money-laundering destinations. The list includes - China, Hong Kong, Indonesia, Laos, Macao, Malaysia, Myanmar, Philippines, Thailand, and Vietnam. Hong Kong, Japan, Singapore, and Taiwan. In North America, Canada and the US are listed as major money laundering Jurisdictions. In South Asia, Afghanistan, India, and Pakistan are listed as major money laundering Jurisdictions. In Sub-Saharan Africa, half of the countries are listed as major money laundering destinations, including Nigeria. Little wonder about all the fuss. Read the full report here.
The contents of the above paragraphs show that money laundering is not pertinent to just crypto and crypto exchanges, neither did it originate with crypto. Methinks it is sad and parochial that certain persons, groups, and bodies consider it to be of utmost importance engaging in underhand attempts, propagating skewed narratives, engendering FUD, engaging in unnecessary detractive legal standoffs, and disparaging propaganda, aimed at trivialising, and belittling the innovative potential of crypto and keeping the average person on the street confused. An unknown author once said – “What we don’t understand, we fear. What we fear, we judge as evil. What we judge as evil, we attempt to control. And what we cannot control…we attack.”. Seems to me like all the brouhaha from governments and banks, is based on lack of understanding and selfish agendas.
Maybe, just maybe, it would be far better learning more about the fundamentals of crypto, its underlying platform and features, potentials and use cases, and its innovative aspects. Maybe we focus a little more on its potential for good, positive transformation and put efforts into developing relevant regulations, rather than spreading half-truths and jumping to quick conclusions that only align with ulterior motives and self-serving agendas. Isn’t human rights about giving the average person, in fact all persons, a right to life and a right to make decisions relating to their own lives? Or do we need a PG rating to decide how and where we want to spend or invest our own money? Like Tuvok said – "our best defense is knowledge". Let us try to understand that which we fear.
