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The big cartels launder money straight to the banks. Drugs are a huge business, 10% of global GDP by some estimates. The banks are all involved, they have to be

The big cartels launder money straight to the banks. Drugs are a huge business, 10% of global GDP by some estimates. The banks are all involved, they have to be. HSBC got caught laundering $670 billion. http://www.bloomberg.com/news/articles/2013-07-02/hsbc-judge-approves-1-9b-drug-money-laundering-accord http://www.bloomberg.com/news/articles/2013-07-02/hsbc-judge...

imaginenore 10y ago
HSBC got caught, and nobody went to prison. The fine was just $1.9 billion. Our prosecutors are a f*ing joke.
- a3n 10y ago
  If we wanted to put a dent in this kind of thing, we'd put people in jail, and fine individuals. But we don't do that, so we must not want to stop it. I suppose the fines are just our cut.
- rhizome 10y ago
  There's a saying that crime is defined as the behavior of the losers in the class war. HSBC is not a member of that group.
  - allendoerfer 10y ago
    True, still I think - at least where I live, crimes of said losers are sometimes not punished hard enough compared to crimes "winners" commit. If you want to spend 5 years in a German prison, you can either steal money from your company [0] or literally kill a guy (if you did not intend to do so) [1]. The first one is a danger to the system, the second one probably had a difficult childhood. Still I think life should be valued much, much higher than money. The US might have the opposite problem. [0] https://www.gesetze-im-internet.de/englisch_stgb/englisch_stgb.html#p2242 https://www.gesetze-im-internet.de/englisch_stgb/englisch_st... [1] https://www.gesetze-im-internet.de/englisch_stgb/englisch_stgb.html#p1806 https://www.gesetze-im-internet.de/englisch_stgb/englisch_st...
    - imaginenore 10y ago
      I disagree about the money. Money is basically a measurement for human labor. Money is human life time. We should sentence people proportionally to how much they steal, which should really cut down multimillion dollar thefts. For example in California grand theft (misdemeanor) is 1 year max in county jail (not even a prison), and 4 additional years if you stole more than $3.2 million. So in the very worst case you get 5 years. How long does it take you to make $3.2M? For the average US person with the median income of $37,679 before taxes it will take 85 years, not counting the taxes.
      - allendoerfer 10y ago
        I think crimes like this should definitely be punished with hefty fines and some years in prison, so even the super rich care about them. But it is just money. Money is not lifetime. Money is just a number central banks can control. You can insure yourself against losing it. It cannot even be lost, it is just somewhere else. The criminal can repay it. Time working for money is not lost. Time being dead, because you got murdered, is lost. Your mother or your children will not cry, because somebody took some money from you. I would even go further: Yeah, making $3,2M will take me a while, but I guess I would prefer to have to regain $3,2M than to cope with psychological or physiological damages of a really violent crime. If I were to lose $3,2M, it would partially be my fault, because clearly my business was lacking some control mechanisms. If two guys come after you from behind, there is really nothing you could have done. Edit: This is another submission currently at the frontpage: https://news.ycombinator.com/item?id=12421687 https://news.ycombinator.com/item?id=12421687
        Trill-I-Am 10y ago
        An NPR story on an explosion at an apartment building in Silver Spring talked about how many of the immigrants living there kept their life savings in cash, which was destroyed. Money can be lost. http://www.npr.org/2016/08/28/491699553/silver-spring-explosion-highlights-tenous-immigrant-journey-of-upward-mobility http://www.npr.org/2016/08/28/491699553/silver-spring-explos...
digi_owl 10y ago
I ran into a claim some time ago that the war on drugs exist in part to prop up the USD after all the printing and spending during the Vietnam War.
- Synaesthesia 10y ago
  A more plausible explanation is that the CIA needs "dark" money (untraceable) in order to operate their shady activities, and that the drug trade is an ideal means for obtaining this money. This is no conspiracy theory but backed up by solid journalism and research - many books by respectable authors have been written on the subject. The CIA has been involved in drug trafficking for decades.
  - TheAceOfHearts 10y ago
    Can you point to any specific book that's approachable to someone that's completely unfamiliar with the topic? This seems fascinating.
    - tjalfi 10y ago
      You could try The Politics of Heroin in Southeast Asia.
nstj 10y ago
So the $670bn number is the volume of wire transfers which were not adequately monitored by HSBC, not a "total laundered amount" > HSBC was accused of failing to monitor more than $670 billion in wire transfers I'm no Heisenberg, but laundering the annual GDP of Switzerland (USD665bn in 2015[0]) is probably outside the reach of a bank. [0]: https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal) https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nomi...
- rando444 10y ago
  While I don't know about the exact numbers, I do recall that HSBC was actively coaching the drug cartels (and hezbollah) on tricks to alter their names on forms so they wouldn't get picked up by watch lists. At which point the exact dollar amounts are irrelevant, and the fact that nobody was criminally charged over this is what concerns me more than anything.
  - nstj 10y ago
    Sure - but we're all here to learn more, so numbers which we're basing discussion on should have some factual basis :). If you're really interested in this stuff you should read up on some of the material from William K Black of UMKC. He was a regulator during the S&L crisis and has some great perspective on financial and control fraud.
    - rando444 10y ago
      The numbers are a secondary item, nitpicked by the commenter above. The original parent was discussing how the banks were involved. I was attempting to bring the discussion back around to the original comment, rather than have the discussion be de-railed by a sidebar about exact amounts. It's interesting, and I am interested, but this whole conversation does nothing but to take away from what the first person was trying to express.

imaginenore 10y ago

HSBC got caught, and nobody went to prison. The fine was just $1.9 billion. Our prosecutors are a f*ing joke.

a3n 10y ago
If we wanted to put a dent in this kind of thing, we'd put people in jail, and fine individuals. But we don't do that, so we must not want to stop it. I suppose the fines are just our cut.
rhizome 10y ago
There's a saying that crime is defined as the behavior of the losers in the class war. HSBC is not a member of that group.
- allendoerfer 10y ago
  True, still I think - at least where I live, crimes of said losers are sometimes not punished hard enough compared to crimes "winners" commit. If you want to spend 5 years in a German prison, you can either steal money from your company [0] or literally kill a guy (if you did not intend to do so) [1]. The first one is a danger to the system, the second one probably had a difficult childhood. Still I think life should be valued much, much higher than money. The US might have the opposite problem. [0] https://www.gesetze-im-internet.de/englisch_stgb/englisch_stgb.html#p2242 https://www.gesetze-im-internet.de/englisch_stgb/englisch_st... [1] https://www.gesetze-im-internet.de/englisch_stgb/englisch_stgb.html#p1806 https://www.gesetze-im-internet.de/englisch_stgb/englisch_st...
  - imaginenore 10y ago
    I disagree about the money. Money is basically a measurement for human labor. Money is human life time. We should sentence people proportionally to how much they steal, which should really cut down multimillion dollar thefts. For example in California grand theft (misdemeanor) is 1 year max in county jail (not even a prison), and 4 additional years if you stole more than $3.2 million. So in the very worst case you get 5 years. How long does it take you to make $3.2M? For the average US person with the median income of $37,679 before taxes it will take 85 years, not counting the taxes.
    - allendoerfer 10y ago
      I think crimes like this should definitely be punished with hefty fines and some years in prison, so even the super rich care about them. But it is just money. Money is not lifetime. Money is just a number central banks can control. You can insure yourself against losing it. It cannot even be lost, it is just somewhere else. The criminal can repay it. Time working for money is not lost. Time being dead, because you got murdered, is lost. Your mother or your children will not cry, because somebody took some money from you. I would even go further: Yeah, making $3,2M will take me a while, but I guess I would prefer to have to regain $3,2M than to cope with psychological or physiological damages of a really violent crime. If I were to lose $3,2M, it would partially be my fault, because clearly my business was lacking some control mechanisms. If two guys come after you from behind, there is really nothing you could have done. Edit: This is another submission currently at the frontpage: https://news.ycombinator.com/item?id=12421687 https://news.ycombinator.com/item?id=12421687
      - Trill-I-Am 10y ago
        An NPR story on an explosion at an apartment building in Silver Spring talked about how many of the immigrants living there kept their life savings in cash, which was destroyed. Money can be lost. http://www.npr.org/2016/08/28/491699553/silver-spring-explosion-highlights-tenous-immigrant-journey-of-upward-mobility http://www.npr.org/2016/08/28/491699553/silver-spring-explos...

digi_owl 10y ago

I ran into a claim some time ago that the war on drugs exist in part to prop up the USD after all the printing and spending during the Vietnam War.

Synaesthesia 10y ago
A more plausible explanation is that the CIA needs "dark" money (untraceable) in order to operate their shady activities, and that the drug trade is an ideal means for obtaining this money. This is no conspiracy theory but backed up by solid journalism and research - many books by respectable authors have been written on the subject. The CIA has been involved in drug trafficking for decades.
- TheAceOfHearts 10y ago
  Can you point to any specific book that's approachable to someone that's completely unfamiliar with the topic? This seems fascinating.
  - tjalfi 10y ago
    You could try The Politics of Heroin in Southeast Asia.

nstj 10y ago

So the $670bn number is the volume of wire transfers which were not adequately monitored by HSBC, not a "total laundered amount" > HSBC was accused of failing to monitor more than $670 billion in wire transfers I'm no Heisenberg, but laundering the annual GDP of Switzerland (USD665bn in 2015[0]) is probably outside the reach of a bank. [0]: https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal) https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nomi...

rando444 10y ago
While I don't know about the exact numbers, I do recall that HSBC was actively coaching the drug cartels (and hezbollah) on tricks to alter their names on forms so they wouldn't get picked up by watch lists. At which point the exact dollar amounts are irrelevant, and the fact that nobody was criminally charged over this is what concerns me more than anything.
- nstj 10y ago
  Sure - but we're all here to learn more, so numbers which we're basing discussion on should have some factual basis :). If you're really interested in this stuff you should read up on some of the material from William K Black of UMKC. He was a regulator during the S&L crisis and has some great perspective on financial and control fraud.
  - rando444 10y ago
    The numbers are a secondary item, nitpicked by the commenter above. The original parent was discussing how the banks were involved. I was attempting to bring the discussion back around to the original comment, rather than have the discussion be de-railed by a sidebar about exact amounts. It's interesting, and I am interested, but this whole conversation does nothing but to take away from what the first person was trying to express.