5 ms·

OK, so you put the dirty $$ in the banking system. Then what? This can work in Russia and alike places but at least in USA you would have to declare it and answ

OK, so you put the dirty $$ in the banking system. Then what? This can work in Russia and alike places but at least in USA you would have to declare it and answer soon or later how you got it. The former Economy Minister having $1.7 Billion in his account might ring a bell or two. Having it there and not being able to use is...useless.

montzark 7y ago
It's not on his account, he would have the credentials to make transactions with the account.
Nomentatus 7y ago
The usual trick is to then have your corporation (pile of illegal cash) loan "you" money - that was Manafort's way, for example. No tax owed on a loan, it's not income.
- wp381640 7y ago
  interesting that part of the way Manafort was caught out is that he had his offshore company directly purchase things for him FBI raided his home, found many bespoke suits in his closet. They traced them back to a high-end tailor and retailer in LA and went and asked them who paid for the suits. From there they located the offshore company and found it was in complete control of Manafort Where in Beverly Hills did Manafort Spend $500,000 in suits? https://www.latimes.com/local/california/la-me-manafort-rodeo-drive-20171030-htmlstory.html https://www.latimes.com/local/california/la-me-manafort-rode...
- C1sc0cat 7y ago
  HMRC are onto that one and are suing a lot of people over those scheames.
  - tomatocracy 7y ago
    It's more controversial than that. The government effectively passed a retrospective tax on this arrangement, called the 'loan charge' because they thought it should have been against the rules but it turned out in many instances it actually wasn't.
- rahimnathwani 7y ago
  "No tax owed on a loan, it's not income." Loans from UK companies to their directors are subject to corporation tax when the loans are granted. The corporation tax may be reclaimed after the loans are paid back: https://www.gov.uk/directors-loans/you-owe-your-company-money https://www.gov.uk/directors-loans/you-owe-your-company-mone...
tjomk 7y ago
Depending on the amount of money you have there, one can set up trades so that the other party gets your money by you "losing" it. One can buy gems, property, rare collectables. You can afford losing 10-50% of the money, but in return still getting enough which will be cleaned. It's not easy, but it's not rocket science either.
- onetimemanytime 7y ago
  Oh I get it but bells still (should) ring. They buy assets on the reference price and sell at market price. That works for relatively small amounts of money, not billions. You can fool USA is you're a Chinese or Russian businessman (hey look I made my money via x and y corp) but mother country should know by tracing to the original amount.
praptak 7y ago
That's the whole point of money laundering - to make the money look legit, so that you can use it. Shell companies are not only to put the dirty money in the system but also to produce a fake record of successful business transactions that make the money look legit.

montzark 7y ago

It's not on his account, he would have the credentials to make transactions with the account.

Nomentatus 7y ago

The usual trick is to then have your corporation (pile of illegal cash) loan "you" money - that was Manafort's way, for example. No tax owed on a loan, it's not income.

wp381640 7y ago
interesting that part of the way Manafort was caught out is that he had his offshore company directly purchase things for him FBI raided his home, found many bespoke suits in his closet. They traced them back to a high-end tailor and retailer in LA and went and asked them who paid for the suits. From there they located the offshore company and found it was in complete control of Manafort Where in Beverly Hills did Manafort Spend $500,000 in suits? https://www.latimes.com/local/california/la-me-manafort-rodeo-drive-20171030-htmlstory.html https://www.latimes.com/local/california/la-me-manafort-rode...
C1sc0cat 7y ago
HMRC are onto that one and are suing a lot of people over those scheames.
- tomatocracy 7y ago
  It's more controversial than that. The government effectively passed a retrospective tax on this arrangement, called the 'loan charge' because they thought it should have been against the rules but it turned out in many instances it actually wasn't.
rahimnathwani 7y ago
"No tax owed on a loan, it's not income." Loans from UK companies to their directors are subject to corporation tax when the loans are granted. The corporation tax may be reclaimed after the loans are paid back: https://www.gov.uk/directors-loans/you-owe-your-company-money https://www.gov.uk/directors-loans/you-owe-your-company-mone...

tjomk 7y ago

Depending on the amount of money you have there, one can set up trades so that the other party gets your money by you "losing" it. One can buy gems, property, rare collectables. You can afford losing 10-50% of the money, but in return still getting enough which will be cleaned. It's not easy, but it's not rocket science either.

onetimemanytime 7y ago
Oh I get it but bells still (should) ring. They buy assets on the reference price and sell at market price. That works for relatively small amounts of money, not billions. You can fool USA is you're a Chinese or Russian businessman (hey look I made my money via x and y corp) but mother country should know by tracing to the original amount.

praptak 7y ago

That's the whole point of money laundering - to make the money look legit, so that you can use it. Shell companies are not only to put the dirty money in the system but also to produce a fake record of successful business transactions that make the money look legit.