They deliberately spend resources on investigating legit withdrawals, so that they appear to be doing something. All in cahoots with the real criminals. Same applies to illegal migration. Spend all resources on punishing legit travellers with visas.
Another elephant is that governments are spending more for law enforcement around drugs, but deaths keep on going up. Surely, there have to be other strategies to consider.
This type of money transfer system was and is common throughout Asia and has been part of their informal economies for centuries. In South Asia, it is referred to as 'hawala' or 'hundi', although hundi does involve the actual transfer of money, while hawala does not. I believe in China it is referred to as flying money. It was prominent in Vancouver, the city I now live in, from c.2000-2016, when drug gangs would launder their proceeds through Chinese brokers who then arranged equivalent debits in China for rich individuals who wanted to purchase real estate in Vancouver. (At that time, they could only take out $50,000 USD from China). It became so prominent that this form of money laundering for real estate is referred as the Vancouver model. I believe this practise has decreased due to much stricter capital controls on outflows from China, starting in 2016, but I'm sure it still exists. Another factor in its decrease may be the 2% investor tax on real estate. Hawala was also the preferred form of money transfer for ISIS and al Qaeda. You should mention this, since this type of money transfer is far wider and greater than being limited to the drug trade.
It was not explained how the Chinese national businessmen who buy USD from the brokers are able to use that cash to invest within the US. Do they deposit it at a bank? How is a non citizen depositing millions in CASH not the biggest red flag? I just don't understand how the cash is able to be integrated into the financial system
@@meiko_kaji What you did is the opposite of explaining. The real explanation is that they launder it locally, usually through real estate, but the laundering takes place on a long timeline, which you can easily handle once you have scale and are patient. You can launder it through businesses, by making fake orders. If you start throwing money around on bling, you're gonna get busted quickly.
so basically, the chinese discovered the hawala system and now are helping drug smugglers. Middle East and South Asian based terrorist have been using this method for decades fund their activity.
America and uk and eu secret services funded all terroist activuties and groups to finamce their arm sales and oil thefts. Hawala is mostly funds poor people disapora . U have no source.
E non è una bella cosa credimi, un conto è vederlo nei documentari un conto è avere criminali di questo livello radicati da secoli nel tuo paese come un cancro. Purtroppo questa è la genialità italiana applicata al crimine, come abbiamo creato la Ferrari e Gucci abbiamo creato la Mafia
I think this is becoming more of a story due to the Chinese President applying the 50,000 USD limit on it's citizens moving funds out of China per year with the aim to keep Chinese capital within its borders (there is a whole range of economical factors behind the decision that i won't get into). With these capital movement restrictions, it provides a great opportunity for money laundering syndicates and crime groups to utilise a Hawala like service to co-mingle illicit funds and proceeds of crime with the billions from the legitimate Chinese business world. Due to these capital restrictions enforced by the CCP, it has opened the eyes of bad actors to utilise a Hawala system one might argue may not have arisen (a least to the level it has today), had the CCP not enforced the capital movement restrictions, as legitimate business and billionaires would be able to move their profits traditionally through the financial system. I'm afraid the underground banking systems are here to stay and will be ever growing, making it hard for authorities to crack down on money laundering and terrorism financing.
The Vaticave transferred all Catilics liquid assets to the bank of the vaticave by Sept 2022. Not one word was mentioned or how many billions were taken out of US. Bsnk failures? Many dtsyed without reserves.
I am an expat currently living in Mexico. Most Americans have no idea how colluded the Mexican government is with the Sinaloa Cartel. Salaries in Mexico are so bad that it is fairly easy for the Cartels to bribe people such as high level politicians, high rank military personnel, media tv channels, and yes, even the president.
Undercut or simply apply a model that works. Offer western country cheap goods and the people become blinded from right and wrong. Do not support western entities support criminal money laundering.
It's culture at this point. It became trendy many years ago. You can't erase it from conversation. Respected people keep talking about their experience with drugs
While the previous 3 comments do have valid points, there is another player in the game that hasn't been properly acknowledged and that's prescription drugs(big pharma), particularly prescription opioids. The surgence of heroin users in the last decade and a half has seen not just a surgence in users after tapering off for a while but also a shift in the demographic that suffers from them. If you look at many of the current people addicted to fentanyl, you can trace it back to heroin, and if you trace the source of that problem, you realise a majority of them started off with prescription drugs. Doctors were earning commission on every prescription of opioids they could get their patients to take(oxycontin for example), with the claims at the time that they did not have habit forming properties. However when the patients had their supply of prescription drugs cut off, they remained addicted and turned to illicit alternatives to get their fix. That was heroin. Although it is difficult to lay the entire blame on pharmaceutical companies for selling "medication" and ultimately resulting in the fentanyl epidemic but they do play a major role in introducing the problem to American society, only for it to become something that was far bigger(and far more profitable) than their own profit margins. Furthermore due to the pervasiveness of drug usage in America(as another commenter mentioned it is part of the culture) and per the laws of economics such as supply and demand, fentanyl is an economically natural development. If you can sell higher quality products(effectiveness of the drug) in smaller quantities for cheaper prices, you have a successful business model on your hands. This has resulted in the resulting "epidemic" of fentanyl we see here. However with that being said, drug usage has moderate popularity in Europe too, with countries such as the UK and the Netherlands consuming and producing drugs respectively(billions of Euros worth). However while drug consumption is moderately "rampant" in Europe, fentanyl remains a relatively small problem. I believe personally(anecdotal) that another commenter has valid points in regards to the quality of life. In Europe many states are modelled based on welfare principles. With the socioeconomic problems of many people being far less severe than their American counterparts. Without a doubt a substantial(but allegedly inconclusive) amount of research has been done on the quality of one's life and their probability of developing debilitating addictions, with harsher living conditions leading to higher rates of addiction. With this being said it comes as no surprise that Americans who live under a government that has a rather inefficient democratic system, corporate liberties outweighing personal liberties, rights to healthcare and high quality education being a privilige as opposed to a right etc. are rather unhappy with their lives and like any human being(or intelligent mammal for that matter) would do is to seek escapism from that pain. All in all it's a complicated problem and the solution is both simple and infinitely complex. However what I personally question is why the relevant organisations are drawing attention to this issue moreso than when prescription drugs were a problem. My logical guess is that it's a matter of numbers, that in absolute terms the number of people dying of it are higher than before and therefore deserves more attention drawn to it. Nonetheless the conspiracy theorist in me wonders how much this "problem" has got to do with the profits not falling into the "right hands". After all a government that puts cannabis under schedule 1 on the prohibited substance list(claiming it has no medicinal value whatsoever) is perhaps one that needs to be scrutinised for its greater interests in profit over their own people.
you should see videos off open air drug markets, drug use, some places in america police don't arrest drug users, you should see videos of "kengsington avenue" and canada, also amsterdam, are like the drug markets in mexico a columbia etc, very bad but also sad
@@ecoideazventures6417 So basically you graduate compulsory education and then discover that you have no money left after paying your bills with a job that asks you to work 60+ hours a week (or two with combined hours). You then find that using fentanyl makes you feel better than actually living. Next, you decide to sacrifice some utilities in your life so that you can fund your drug addiction because you believe you'll never get ahead in the first place.
I’m from the Bay Area. Our prices went so crazy for so long, that for many periods of the last decade and longer, almost everyone trying to buy a house in the hottest markets lost their bids to a Chinese “over-offer”. That means that the Chinese were willing to pay 1.2-1.5 the HIGHEST OFFER in a market where houses were regularly surpassing $700,000 and topping off at past a million. NOTHING rentable was under $500,000 (and that’s a bad neighborhood).
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The pathway to substantial returns doesn't solely rely on stocks with significant movements. Instead, it revolves around effectively managing risk relative to reward. By appropriately sizing your positions and capitalizing on your advantage repeatedly, you can progressively work towards achieving your financial goals. This principle applies across various investment approaches, whether it be long-term investing or day trading.
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Finding financial advisors like Melissa Terri Swayne who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
I expected more from the FT. The title does not match the theme of this documentary which is IVTS, not money laundering. The whole doc covers the remittance of funds not how the funds are laundered for this you need placement, layering and extraction and the last 5 min of the doc do not cut it (as we are talking about billions that are moved around but not placed into the financial system - this is not explained in this doc). Misleading title - get it right next time!
The laundering portion happens when criminal proceeds are propping up the liquidity and settlement for the other side of the trade. They mentioned it towards the tailend of the video.
The whole point of wealth for me is freedom. My magic number in my mind is 5 million needed at 65 to not worry about anything. Am i better off investing a good portion of my income into stocks or real estate to achieve this goal?
Varied sources of income is wise and especially living within your means. My net worth is $2M and I can pay my bills with no stress, but I don't live like I have that. I have no complaints.
Money advice is subjective, what works for you may not work for someone else, but it's always better to plan. I'm quite lucky exposed to personal finance at an early age, started job 19, bought first home 28, got laid-off work 36 amid covid-outbreak, and at once I consulted an advisor to handle growing my finance. As of today, I'm only 25% short of my $1m goal after subsequent investments.
bravo! inherited money from a childless relative and traveled overseas, got married to a lady almost my age, but the only issue is how to preserve and grow my wealth in view of retirement, can your advisor be of help please?
I work with Jessica Lee Horst as my licensed advisor. Simply look up the name. You would discover the information you needed to schedule an appointment.
Thank you for sharing, I must say, Jessica appears to be quite knowledgeable. After coming across her web page, I went through her resume and it was quite impressive. I reached out and scheduled a call
Chinese underground banking has been around for very long, at least 200 years. At least it is known to be the way Chinese immigrant working in Southeast Asia sending money back and receiving money from mainland since 150 - 200 years ago.
@@turtleofpride4572if there was no demand even with all the supply no one would use it. You can have a mountain of gold but if no one wanted it it’d just be some useless mineral.
Also this is a basic economic principle, demand sets the price of a supply so therefore with absolutely no demand and high supply its price/worth is $0. That’s why companies go bankrupt with thousands of products but no one willing to buy them.
HSBC won't make as much money.... and neither will real estate agents in Australia. Our government knows that money is laundered through our real estate market but still hasn't bothered to do checks and balances on it.
I think HSBC makes alot of money because not only Chinese, alot of American wealthy, European, Middle eastern and South East Asian or even East Asian wealthy people runs through HSBC. No government can put them or any financial institute in check since many wealthy around the world runs through them. Many politicians are also wealthy so you cannot hold HSBC accountable for anything. This isn't just Chinese but many wealthy uses HSBC or other financial institutes
Oz govt wants the foreign cash. It grows by the 10x in the legit banking system due to low reserve requirements. And they want higher real estate prices for higher taxes.
In Pakistan we call it the Hawala system.Majority of overseas Pakistanis send remittances through Hawala channels so that the transaction is not traced and tax is not deducted from it.
Panama papers, Pacific Papers - yet there is complete blindness in that area. What the govt does not like is arbitrage - gone are the good old days of setting gold prices and exchange rates. And if you are huge, you can play the futures and derivative markets via sham companies.
This method of moving money across borders is known as "hawala." Its use was necessitated by the tight foreign exchange restriction in the sub-continent.
The Americans are new to this game. They will eventually learn. But that will take many centuries. They are still at the stage of squandering her money on her navy.
In my opinion, housing market crash is imminent due to the high number of individuals who purchased homes above the asking price despite the low interest rates. These buyers find themselves in precarious situations as housing prices decline, leaving them without any equity. If they become unable to afford their homes, foreclosure becomes a likely outcome. Even attempting to sell would not yield any profits. This scenario is expected to impact a significant number of people, particularly in light of the anticipated surge in layoffs and the rapid increase in the cost of living.
I suggest you offset your real estate and get into stocks, A recession as bad it can be, provides good buying opportunities in the markets if you're careful and it can also create volatility giving great short time buy and sell opportunities too. This is not financial advise but get buying, cash isn't king at all in this time!
You are right! I've diversified my portfolio across various markets with the aid of a financial adviser, I have been able to generate a little bit above $450k in net profit across high dividend yield stocks, ETF and bonds.
I have been thinking about how to grow my reserve by at least 40% or more within months. I will be grateful if you can give tips or anything on how to make good market picks and how I can get my portfolio diversified and balanced in order to meet up my target.
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You work for 40yrs to have $1m in your retirement, Meanwhile some people are putting just $10k in a meme coin for just few months and now they are multi millionaires. I pray that anyone who reads this will be successful in life
Thanks for continuing updates I'd rather trade the stock market as it's more profitable. I make an average of $42,500 per week even though I barely trade myself.
You should hire a financial advisor to help you diversify your portfolio by including mutual funds, exchange-traded funds (ETFs), the 11 GICS groups, inflation-indexed bonds, and stocks of companies with consistent cash flows rather than growth stocks, where prices are based on future prospective earnings. Following these principles and insights from my CFP, I have made approximately $600,000 since 2020
I was thinking about this all the time. Millions of people are probably doing money laundering without knowing, without earning from it, and quite often losing money
This system has been used in ancient China for centuries, Muslim countries have used this hwala system for ages. I believe many ethnics have this system. It's an ancient way of banking, nothing new, I'm surprised that they are surprised.
AML checks need to evolve. And banks need to do their part. Money might not have moved internationally but it still has moved from one party to another, often via bank accounts. As a banking customer you must have viable, provable reasons for significant movements of money in/out of your account. If you can't provide a valid proof, it should be liable to be being seized by authorities.
In India this was called HAWALA laundering system/network. It has been clamped down now. A payment system like UPI is really needed for traceability and any transactions in cash should be penalized.
@user-rk9it9hz6g there’s too much hypocrisy in America for me buddy that 💩 is choking all of us out. Not to mention, these “news” outlets have 0 self awareness.
I don't know it really matters. If you happen to be a Russian Billionaire that made his money shipping and selling wheat - USA will still freeze your assets and yachts anyhow. USA seems to want to sanction Quebec for being... French.
Hang on...the whole story was not explained. Chinese want to move 1 Million USD equivalent of Renminbi out of China. In the UK a Chinese broker "gets his funding from a drug cartel wanting to launder money"...I do not get it...what is the use of Renminbi to a drug cartel in Columbia? Makes no sense at all to me. Interesting though it is, it is clear that the entire story is not elucidated in this very interesting program. The fact remains that there has to be bilateral or even trilaterial interest in currencies or assets in different jurisdictions for this to work. If I pay 1.1 Million USD equivalent of Renmimbi to someone in China and I received 1 Million USD in the UK, someone in China has the issue of dealing with the Renmimbi...the story does not add up.
I think it can work IF: Chinese govt. don't check how a medical company make their money. If they make fentanyl or illegal Wegovy, what does that matter for China as long as they sell to west? Then the physical USD bill is "smuggled" into China, and the bills are changed into RMB by chinese govt. which then financies the import compagnies in China, buying iPhones, Mercedes, airplanes, US treasuries with USD from export of fentanyl and fake Wegovy. It should be possible to verify if this is the method, by totalling the import and export between US and China: does it balance. Which is extremely difficult to do
how can they explain it properly when they have no idea how it works. It doesnt add up because the reporters are clueless. As clueless as the cops who barely finished high school. CIA probably knows and they are a part of it.
It works because Renmimbi is valuable within China and used to buy everything. The chemicals exported from China that are used in Mexico to make the fentynal are ultimately paid for with USD on the streets of USA where Chinese people want the money. The Renmimbi is used in China to make the chemicals for export.
The war on drugs has failed. As with the prohibition of alcohol, it didn't stop the problem, and it empowers black markets, organized crime, and corruption in policing.
8:40 Poorly explained. I don't understand how the brokers settle their transfers across borders? Surely at some point the brokers in the US, Mexico and China need to move the money to each other which would be the trickiest part of the laundering process. But that part is left out completely in the video. So it is a video about money laundering without the explanation about the actual laundering
They just need to match the incoming and outgoing amounts. As long as the demand for both sides of the trade balances, it will always be a nett trade. If there's too much of a supply on one side, it will just affect the price of the currency which is in big supply. For example, if I have USD 1m which needs laundering into the mexican peso equivalent, I just have to contact my mexican counterpart and let him know I need pesos and to check if he has a USD buyer who is paying in Pesos. It can be a wholesale deal or in parts, just depending on the rate. If there isn't enough pesos on the other side, then the USD seller has to adjust his rates and eventually someone will trade pesos for all my USD stock. Just imagine it to be a forex trade, except the trades are executed in a very manual and labor intensive format.
this is an anti china propaganda piece to justify snactions on chinese banks. China fought the opium war and has outlawed drug trade with the death penality. In the u.s drugs are legal.
It's not hard since there is a big Chinese population in both Californian states in Mexico, so it makes sense that the process works since the narcos don't have to leave the country to do it.
What is troubling is that there is a movie by Brandon Lee and duff something specify this exact scenario situation back in the 90s. So it's not like were just finding out because somebody new over 20 years ago
I think the new aspect is how the currency swaps don't actually involve moving any money. RMB only circulate within China, and USD only circulate within the US, but still everybody manages to move their money across borders.
The only difference between legal and illegal, is paperwork. If it's taxed or profited by investors, and politicians it's legal. If the same thing is done under the table, it is illegal.
Very good video - thank you! I created a video on this topic for my channel a few months ago but sadly it did not have much success, which is a shame as I wanted to raise awareness about this problem across my community. I'm only a small RU-vidr not the FT of course but still, I was hoping the YT algorithm could push it a little more to let more people know about this. With that said, I'm happy that at least your video is going strong on this so one way or another the voice on this issue is heard. Thanks again!
So many constructive criticism/ comments, even better than the article itself. Just to show that people are more educated today, more opinionated, and maybe even more knowledgeable, informed, willing to listen and understand the issues.
I make 500k a year. Mind you I have no children and zero debt. I have a six figure portfolio (Stocks, crypto crowdfunding real estate, savings, and CD's) it wasn't easy. I hustled, saved, and invested my money. I always tell people "Money can't fix stupid"
What you are describing is just money transfer. That's not really money laundering, if you just get a pile of cash and you can't show any legitimate source for that cash. If they really do this at 2% including exchange rate, I want in on this ...
Knew of folks who did this in Shanghai, tons of money leaving the country for US, Australia, EU. Folks fleeing with assets like their lives depended on it.
A question I have is how criminals will transact their business once nations and entities implement the rollout of CBDCs, removing cash from the system.
Assuming CBDCs are implemented, there's no reason to think the elimination of cash would follow. At least the US dollar wouldn't go anywhere (the fact the penny still exists is evidence of that).
As if this hasn't been known for generations! The older i get, the more my eyes roll as the powerful do as they like, by getting away with it. They then buy they way round everything, and the system is corrupt beyond anyone wanting to repair it. Integrity is a lost word. None of our appointed do anything about it, yet we can get 'done' for day to day misdemeanors, and are made to feel guilty.
Thank God we’ve got a completely open border and a justice system that never prosecutes actual crime. That must help, right?! Because, you know…EQUITY.
In Milwaukee, there are over 17 cars stolen EVERY DAY and this car theft epidemic has gone at the rate for several years. I have long maintained that there is some sort of money laundering, insurance fraud, or something at the heart of all this This amount of car theft is not the action of joy-riding teens, but rather is very organized, methodical, and lucrative. Auto theft is preventable and predictable, yet our 0ur police appear clueless and ineffectual.
