Suppose you are a
small-time drug dealer selling
dime bags to kids. You probably don't have to be too
concerned about all the 5 and 10
dollar bills you accumulate - you'll just
buy more stuff to sell from your next
higher-ups with the
stacks of cash. So,
somewhere up the criminal
food chain, there will exist (a) a
middle-management drug lord, whose job it is to "
clean" loads of this
dirty money.
Alternatively, suppose you are (b) a
gang leader of a bunch of crooks collecting
protection money from
local businesses, so you're receiving
thousands of dollars in
cash every week.
Or perhaps you are (c) a
Russian mobster selling
cheap, lethal, illegally distilled vodka to
Siberian peasants, or maybe you're in
cahoots with the
government and no one is supposed to know (including the
government, some of whom most definitely do, and some who most definitely do not).
Money laundering works basically the same way for all three. Having lots of cash is
contraindicated.
Money that comes from
criminal activity (
drugs,
hot goods,
etc) is usually in
cash. If the
IRS or
INTERPOL smells lots of cash on you they'll start
investigating where it comes from, which, as a
criminal, is against your
career strategy. Owning a
business,
however, is fine. Owning a
profitable business is even better, so long as the
profits are not so
sky-high that even a
retarded monkey could tell that there is some
alternative source of
revenue.
So, in the case of (a), the
middle management drug lord may set up a
crappy restaurant that no one goes to or a
laundromat (ha ha!) to
account for all the
little bills coming in. Miraculously, the
initial seedy capital suddenly becomes
money spent by honest punters wanting clean knickers.
(b) your
gang will probably own a
bar, or a number of bars, and you might even
sabotage the
Interact machine that previous
honest bar owners or
managers (who you have possibly had
rubbed out) installed, so that more people will spend cash, and the volume should be such that it easily
masks a few extra bills here and there. You will of course pay for all
deliveries and services for your business in cash.
(c) one of the many sneaky
Russian schemes is to buy
luxury goods in
dirty cash and then
sell them for
clean cash.
Sotheby's,
Christies,
fashion houses and many
exclusive auto dealerships have a
$50,000 U.S. cash cap - any larger (and many smaller) cash payments are
reported and
scrutinized.
Another brilliant
Eastern European trick is to set up a
Linux starter kit distribution site with
e-commerce functionality, not only suckering people into paying for free software, but also giving you the option to vastly inflate your
volume of customers.