5 ms·
A few possibilities: First, the amount appears to be the total through a bank, where this number would be aggregated over a several (possibly many) individuals
by liara_k 7y ago
A few possibilities:
First, the amount appears to be the total through a bank, where this number would be aggregated over a several (possibly many) individuals.
Second, the amounts reported do not reflect the total funds laundered (illicit funds made to appear legitimate) but the total revenue stream, which would be offset by liabilities. For example, one laundering technique I've read about involves buying real estate and selling it at an inflated price to someone who has the illicit funds. For example, A has illicit cash and wants to transfer it to (apparently) legitimate profits by B. B buys a property for $1m. B sells the property to A1 for $2m. B keeps the $1m difference as profit. A1 later sells the property at a loss, and the cycle is complete. Repeat this a few thousand times, but probably with a smaller % margin. But assuming a 100% margin (and the whole laundering effort being exactly this scheme) that'd be $450B total revenue but $225B actually laundered.
Interesting side effect: This pushes up the cost of housing in an area until the launderers abandon it, at which point demand and purchase volume dries up significantly and valuations sink. Additional profit could be made off this market manipulation.
- selimthegrim 7y agoI’m pretty sure you can still buy houses in Slavic Village sans copper wiring for the low thousands
- liara_k 7y agoYeah, but then you have to do orders of magnitude more transactions, creating a large paper trail in exactly the place you'd want to avoid that.
- myth_drannon 7y agoThat's how Vancouver got its house prices - money laundering by Chinese nationals.
- robertAngst 7y agoSource?
- cududa 7y agoUse google. There’s a million stories on this. It’s well known
- swatkat 7y agohttps://www.bloomberg.com/news/features/2018-10-20/vancouver-is-drowning-in-chinese-money https://www.bloomberg.com/news/features/2018-10-20/vancouver... https://globalnews.ca/news/5259196/home-prices-in-metro-vancouver-increased-by-5-due-to-money-laundering-report/ https://globalnews.ca/news/5259196/home-prices-in-metro-vanc... https://business.financialpost.com/news/fp-street/dirty-cash-probe-finds-booming-vancouver-china-luxury-car-trade https://business.financialpost.com/news/fp-street/dirty-cash...
- Mikeb85 7y agoIt's pretty much the main subject of all news coming out of Vancouver for the last year...
- msie 7y agoThe economics of Vancouver real estate is more complicated than that. Don't let the press fool you. And reporters aren't all doing independent research they are often using the same source or using each other. For instance, Global news is using research from a Postmedia reporter. And all Postmedia newspapers are reprinting or relying on that one reporter's research. Also, when you look at the German report on money-laundering effects on RE there is a lot of guessing but the press reports it as fact. Sigh.
- msie 7y agoWhat also irks me is this Postmedia reporter also wrote about a middle-eastern money-laundering ring operating in Canada (for Hezbollah) but there was hardly any (if any) coverage of it on Global News (tv). Usually there is this cross-publishing between Global News and Postmedia. It just wasn't sexy enough for television. Probably because it didn't fit the narrative of Chinese Gangs ruining Vancouver RE through money-laundering.