My Comments: Every two years, I’m required to complete an Anti-Money Laundering (AML) overview and exam. At the local level, it’s mostly about drug money and efforts to turn illegal money into legal money with insurance and investment products.
The AML effort has the effect of reminding us about behaviors, questions, circumstances, patterns, etc. that are consistent with those used by people who were caught laundering money. If we get even a hint of AML behavior, we are required to alert a compliance officer immediately. The idea is to avoid any legal morass that is sure to follow.
What follows here is Chapter Two of a five part story that explores the long time relationship between our 45th President and Russian individuals. If you are disturbed, whether as a Republican or Democrat about the issue, then you owe it to yourself to read what is said below.
As Donald Trump entered the stage as a viable candidate for President, I was aware of relationships, comments, questions asked, financial outcomes, etc., that raised AML flags in my mind. If someone came into my office with similar circumstance, and refused to provide me with satisfactory answers to questions I posed, I would be bound to refuse any requests and report what was said, or not said.
His candidacy was for me a giant red flag. And nothing said and done so far by he and his team has caused me to change my mind.
Say you’re an oligarch in a country that loathes them but is powerless to do anything about their existence because the highest levels of government profit off their businesses, legal and not. While you might think you have it made, your position is actually quite precarious. Pull on your leash too much and start commenting on politics, and you might just find yourself in jail for tax evasion and embezzlement, or sent into exile according to the template that shut down a critical news channel first, and stealthily re-nationalized an oil empire soon after that.
You probably want to hedge your bets and find a country to which you can make a smooth exit, ideally spending a lot of time there and out of the government’s sight and mind. If things get bad, you can just pull your assets and stay abroad.
Many countries are happy to allow a wealthy foreign investor with millions in cash to set up shop permanently, as long as all that cash looks legitimate. And that condition could be a problem if you’re trying to wire it from a country under sanctions, or your income history has gaps indicating something shady went down.
Of course that’s why money laundering exists. One of the simplest ways to do it is to create a web of offshore companies strategically located in countries that don’t ask a lot of questions about where the money came from, but are just happy to take their cut. Many are the usual suspects in the Caribbean, but other favorites include the Seychelles, Cook Islands — which are now being called the Crook Islands by the natives thanks to their sudden surge in popularity as an offshore destination — and of course, Cyprus, which is heavily favored by Russians.
These offshore companies can cross borders, invest and transfer cash between each other, and after creating a frustrating enough web of transfers and exchanges, as many of them as vague and anonymous as possible mid-transit, they can invest in money-making ventures. Over time, they build small empires in their target destinations, which for Russians are often Switzerland and the UK, particularly London. But that’s fairly basic. The real pros are a lot sneakier than that, using charitable organizations and nonprofits as their identity shields.
These funds, as they’re called in Russia, are operated by LLCs that transfer assets, take out loans, and can make a single large organization doing all sorts of questionable deals and making eyebrow-raising purchases when viewed as a single entity, into a web of seemingly unrelated organizations with very different agendas. With enough records to have to sift through, they can hide their affiliations for years, often in plain sight, just because the web is too tangled to really unravel without a very good reason to spend months parsing paperwork.