What is money laundering and how does it work?

Many years ago, I asked an erudite friend to elucidate me on money laundering. I didn’t understand how it worked. He explained. I still didn’t get it.

So I’m grateful to Adam Davidson who’s writing a series of articles for the New Yorker on Trump’s financial affairs. Because, natch, money laundering and suspicions thereof pop up big in Trumpland.

Here’s how it works:

The goal of laundering money is to take the proceeds of a criminal activity—government corruption, tax fraud, drug trade, or many others—and to disguise its origin. Many oligarchs in the former Soviet Union who made their money by expropriating the state’s wealth want to move their money into a more stable nation with greater rule of law. This presents a challenge: How can one insert illegally obtained funds into a system that requires due diligence? The answer, quite often, is to use shell companies to disguise the flow of funds. Although we cannot say that Trump himself knowingly engaged in money laundering, we do know with certainty that much of his business in the past decade was in the industries most known for money laundering, in the locations most conducive to money laundering, and with people who bear the key hallmarks of money launderers.

I for one am eagerly awaiting Mueller’s Money Laundering Indictment, which should be a doozy.

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