Laundromat Banks Too Big To Fail


Richard (Rick) Mills

Ahead of the Herd

Page 1 of 2


As a general rule, the most successful man in life is the man who has the best information


Money laundering is the process by which illegally obtained cash is made to appear as if it has been obtained by legal means.


The following snippet is from Robert Mazur’s article ‘How to Halt the Terrorist Money Train’ article that appeared in The New York Times:


“The House Subcommittee on Oversight, Investigations and Management issued a shocking report documenting the collaboration between Mexican and Colombian drug cartels and Hezbollah in narcotics and human trafficking, smuggling and financial crimes in the United States and Latin America — a partnership that, in just the border region between Brazil, Paraguay and Argentina, produces an estimated $12 billion in cash each year.


Yet data from the Department of Justice Asset Forfeiture Fund and the United Nations Office on Drugs and Crime Research Report show that United States law enforcement tracks down and seizes no more than 1 percent of the drug fortunes generated each year by global cartels.


The rest isn’t hiding in mattresses. It’s being washed — stripped clean of information that would identify its source, then transferred from one account to another, and often moved surreptitiously through various business enterprises, until it can settle safely in a criminal’s private offshore bank account. None of this happens without help from bankers, lawyers and businessmen.”


According to the U.S. Department of Justice the Sinaloa drug cartel, together with Columbian drug traffickers, the Norte del Valle Cartel, moved $881 million through HSBC between 2006 and 2010.


"The investigation further revealed that drug traffickers were depositing hundreds of thousands of dollars in bulk U.S. currency each day into HSBC Mexico accounts. In order to efficiently move this volume of cash through the teller windows at HSBC Mexico branches, drug traffickers designed specially shaped boxes that fit the precise dimensions of the teller windows. The drug traffickers would send numerous boxes filled with cash through the teller windows for deposit into HSBC Mexico accounts. After the cash was deposited in the accounts, peso brokers then wire transferred the U.S. dollars to various exporters located in New York City and other locations throughout the United States to purchase goods for Colombian businesses. The U.S. exporters then sent the goods directly to the businesses in Colombia." U.S. Department of Justice


In violation of the Trading With the Enemy Act HSBC also used various schemes to move hundreds of millions of dollars to nations subject to trade sanctions. The list of nations included Iran, Cuba and the Sudan.


“On at least one occasion HSBC instructed a bank in Iran on how to format payment messages so that the transactions would not be blocked or rejected by the United States.” Assistant Attorney General Lanny A. Breuer,


HBUS, the American affiliate of HSBC, repeatedly broke American Anti-Money Laundering (AML) laws. HBUS supplied the Saudi bank Al Rajhi with nearly US $1 billion. Al Rajhi used the money to finance terrorist groups including Al-Qaeda.


“They violated every goddamn law in the book. They took every imaginable form of illegal and illicit business.” Jack Blum, an attorney and former Senate investigator regarding HSBC


Since 2006 more than a dozen banks have reached settlements with the Justice Department regarding violations related to money laundering including the following entities:

  • ING Bank
  • American Express Bank International
  • Union Bank of California
  • Lloyds
  • Credit Suisse
  • ABN Amro Holding (now owned by Royal Bank of Scotland)
  • Barclays
  • Standard Chartered.

All these banks admitted guilt and all were handed traffic tickets – please pay your fine on the way out the door.


At one time Pablo Escobar’s drug cartel controlled 80 percent of the world’s cocaine trade. His recipe for success was: “You bribe someone here, you bribe someone there, and you pay a friendly banker to help you bring the money back.”






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