Drug money saved banks in global crisis, claims UN advisor

[autorank]

Well, it's Joyeux Noel from the mob. Tina over at The Agonist picked this up. :wtf:

Drug money saved banks in global crisis, claims UN advisor

Drugs and crime chief says $352bn in criminal proceeds was effectively
laundered by financial institutions

Rajeev Sayal
The Observer, Sunday 13 December 2009

Drugs money worth billions of dollars kept the financial system afloat at the height of the global crisis, the United Nations' drugs and crime tsar has told the Observer.

Antonio Maria Costa, head of the UN Office on Drugs and Crime, said he has seen evidence that the proceeds of organised crime were "the only liquid investment capital" available to some banks on the brink of collapse last year. He said that a majority of the $352bn (£216bn) of drugs profits was absorbed into the economic system as a result.

This will raise questions about crime's influence on the economic system at times of crisis. It will also prompt further examination of the banking sector as world leaders, including Barack Obama and Gordon Brown, call for new International Monetary Fund regulations. Speaking from his office in Vienna, Costa said evidence that illegal money was being absorbed into the financial system was first drawn to his attention by intelligence agencies and prosecutors around 18 months ago. "In many instances, the money from drugs was the only liquid investment capital. In the second half of 2008, liquidity was the banking system's main problem and hence liquid capital became an important factor," he said.

Some of the evidence put before his office indicated that gang money was used to save some banks from collapse when lending seized up, he said.

"Inter-bank loans were funded by money that originated from the drugs trade and other illegal activities... There were signs that some banks were rescued that way." (Said) Costa...

The Money Party is coming out in the open, big time.

[formercia]

1. The Drug Cartels didn't do this out of the goodness of their hearts

So, what do they get in return?

[autorank]

2. Your question alone is worth about 40 votes for this one n/t

[Greyhound]

4. Clean money plus a bit of interest; Priceless. n/t

[autorank]

8. Financial hygiene;)

[Uncle Joe]

16. Other than what has already been posted in response, they probably want the banks to support

"The War on Drugs."

That insane and dysfunctional policy has been the primary source of the drug cartel's wealth; the goose that lays the golden eggs.

I can't imagine organized crime would want it to stop and the banks could openly support "strong on crime" politicians so long as those politicians looked the other way in regards to bank money.

[autorank]

21. So it's junkies not "the American consumer" "saving the world economy?

Yes on the futility of the war on drugs but I'm still absorbing this Uncle Joe.

formercia asked a great question up thread. What did they get in return?

:hi:

[truedelphi]

34. Part of what they get in return is that they are bought & paid for by the drug money.

bought & paid for by the drug money. Drug cartels own huge amounts of banks in Florida California and Arizona. They do this by cleaning up one member of their family and shipping him off to the USA.

Once the family member arrives in the industrialized nation where the Drug family wants that person to operate, they purchase a bank. An entire bank.

Now that person has legitimacy as a community insider or leader.

And the money starts to flow to the local politicians. This ensures that our drug policies stay in place.

You have no idea of the editorials that got written in San Diego (And letters to the editors too) when Schwarzenegger let it slip that he toys with the idea of legalizing marijuana. According to the letter writers, if we legalize marijuana, just marijuana, in the state of California, then the world will end.

Translation - a lot of unemployed cops, a lot of unemployed prison guards, a lot less money for the local politicians to keep sticking those "just say no" posters all over everything.

And since the Central Banks do not have to worry about the small drug laundering facilities (ie banks) ever collapsing, it gives them one more way to make money by giving them loans when they want them.

That's my take on it anyway. After some thought you might have a few even better ideas.

[leftstreet]

25. An excellent question

K&R

[Me.]

3. Wow

Now the question is, will this be reported in this country? Will Geithner be questioned about this?

[autorank]

7. Little Timmy has shown a lot extra energy lately;)

Nah, nobody gets questioned. Do you remember "Clutch Cargo" - that's who Geithner reminds me
of when he talks.

[maryf]

5. hhhmmm

Another reason Afghanistan is so valued?? Just a whim, K&R, of course...

[autorank]

6. We think alike

I immediately thought Afghanistan ... Formercia's question above is quite a good one, isn't it?

I mean, they didn't just use the money without permission, special "permission."

[maryf]

27. Yes, always follow the money! nt

[malaise]

9. But but but

I thought the big banks always laundered drug money.

[autorank]

11. Maybe this his how?

They're trying to be "good corporate citizens."

[Joe Chi Minh]

10. Blood is thicker than water, as the old saying goes. The far-right has

always formed pretty much of a continuum with organised crime in all countries.

For 'hits', I think that, in the UK, the far-right/major corporations would have been more disposed to turn to MI5 than organised crime.

[autorank]

12. MI5 is cash rich?

[Joe Chi Minh]

13. It seems to have virtually limitless funds. Controlling traffic-lights, hiring large,

new, articulated trucks, access to the use of garbage trucks, undertakers' hearses, even buses, I believe, and any number of different personnel - well, they have have great imaginations, it seems to me, and oddly enough a great, albeit dark, sense of humour, which I've perversely appreciated much of the time. I may sound as if I'm bullsh*tting, but I haven't been exposed to a millionth of the "not nice" way they could be.

I expect that, given the nature of our World and its geopolitics, all the more technically-developed nation-states, at least - their all being essentially and unambiguously psychopathic - national clandestine services would all have to have some of the worst monsters in any society on hand for black ops, as well as just regular people for ordinary mischief.

[formercia]

28. J Edgar Hoover was in bed with the Mafia

He told them they could have Sicily if they supplied Intelligence for the landings in WWII.

We know how that turned out.

[Joe Chi Minh]

31. And Mussolini had virtually suppressed the mafia; perhaps the only good

thing he ever did for his country.

Chiang Kai-Shech had been in organised crime in his younger days.

[bleever]

14. K&5R.

Wow.

[autorank]

19. Good way to keep people off drugs - Do you really want to support Wasll Streed fat cats?

:)

[bleever]

22. Talk about a buzzkill.

[formercia]

29. Buy locally grown produce

takes on a whole new meaning.

[puebloknot]

15. Unbelievable? Not really. A very close relative worked for the DEA ...

... and told me sub rosa stories eight years ago (note the time frame)about drug activity and politics.

Nothing classified, just things he saw sitting on docks, out in the open, while doing his job. He was not an agent, just doing peripheral assistance.

What a wonderful world!

[autorank]

18. How about that. That's what they call Special K, er ... D

This revelation doesn't really require require much comment. It's like a Zen Koan - it just
presents and educates at the same time. No room for error here.

:hi:

[truedelphi]

17. Can't read all the way through as the power here is iffy.

But thank you for psosting this. i will quickly K % R both for reading it later and for using up the power before it goes DA.....

[autorank]

20. You just need the headline i- rofl

It's quote a move on the part of the UN analyst. He'll be sorry, no doubt.

This is the final word - Houston, we've got a problem ... it's FUBAR beyond recognition.

(Although Houston is looking very great today!)

[truedelphi]

26. This reads like several posts of mine from about a year ago.

At the time I was reading a "Chick lit" thriller - woman's kid is kidnapped as the ex husband owes so much to the Mexican mafia.

The statistics quoted in the book were chilling: For example --

Break down of the Mexican economy:

One third is drug money
One third is resort/tourist earnings
One third is the money that those who work in the USA send back home to their families (Book was written in 2006 before the Depression hit. So the last two entries have fallen short since Fall 2007. Little wonder that last year was so drug crazy and brutally bloody south of the border - the other two sources of money were drying up!)

And then there are the overlapping elements - that the Drug Cartel Families clean up one member of the family and send him to the USA so that he can outright purchase a bank on the US side to use for money laundering purposes. And then the cleaned up drug money character starts buying up local politicians here.

When Bernancke started saying that we really shouldn't ask for total transperency about banking transactions, I would always think of this book and its contents. (Can't remember the name of the novel - and the friend who I lent it to lost it.) But the details were great - and as the "Dirty drug money banks" need to funnel money through all the major banks, just like everyone else does, you gotta believe that all the top banks know that this is going on.

[ihavenobias]

23. As usual, another interesting post. n/t

[autorank]

24. You think anyone will ask Timmy or the president about this?

Maybe the head of the FBI.

As they say, "follow the money";)

[ihavenobias]

30. No. n/t

[Octafish]

32. Catherine Austin Fitts was on to their gangster ass way back...

Narco Dollars for Beginners

So was Gary Webb and his readers on DU...

DEA Agents Agree: CIA means Cocaine Importation Agency

[truedelphi]

33. good links, those. Thanks Octafish. n/t