Banking - Blog 2.0 - Gangsters Inc. - www.gangstersinc.org
2024-03-28T17:27:13Z
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British secret agents have a license to commit crime
https://gangstersinc.org/profiles/blogs/british-secret-agents-have-a-license-to-commit-crime
2018-03-03T14:56:07.000Z
2018-03-03T14:56:07.000Z
Gangsters Inc.
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<div><p><a href="http://gangstersinc.ning.com/profiles/blogs/british-secret-agents-have-a-license-to-commit-crime" target="_blank"><img class="align-center" src="{{#staticFileLink}}9237097870,original{{/staticFileLink}}" alt="9237097870?profile=original" width="600" /></a>By David Amoruso</p>
<p>After all these decades, James Bond’s license to kill still sounds pretty cool. Though 007 is far removed from the real-life spies working at MI5, they do have a similar license that gives them a pass to commit crime in the United Kingdom, Theresa May, the country’s prime minister revealed in a text on Thursday.</p>
<p>The document was <a href="https://www.ipco.org.uk/docs/20180301%20PM%20direction%202.pdf" target="_blank">published</a> after a months-long legal battle by human rights groups Reprieve and Privacy International. It details a direction to the Investigatory Powers Commissioner’s Office, the secret service watchdog, on governing “security service participation in criminality.”</p>
<p>As newspaper <a href="https://www.theguardian.com/uk-news/2018/mar/02/mi5-agents-are-allowed-to-commit-in-uk-government-reveals" target="_blank">The Guardian</a> observed: “It instructs the IPCO to oversee the participation of MI5 agents in criminal activity, which was previously conducted by the now-defunct office of the Intelligence Services Commissioner, under a secret order referred to as the ‘third direction’.”</p>
<p>What type of crime MI5 agents can get away with and when remains confidential and falls under the direction of the British government.</p>
<p>The world is an ever-changing place, but one thing remains the same: It revolves around money. And where there’s money, there is crime. White collar or blue collar, greed does not care. If MI5 seeks to keep the country safe its secret agents might need to win the trust of certain individuals in order to infiltrate criminal organizations and activities.</p>
<p>In <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Russia" target="_blank">Russia</a>, for instance, politics and organized crime have long been intertwined. With many <a href="http://gangstersinc.ning.com/profiles/blogs/russian-mafia-overview" target="_blank">Russian oligarchs</a> operating on Britain’s soil, it makes sense to be able to get one’s hands dirty to get close enough to keep an eye on certain individuals.</p>
<p><a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Terrorism" target="_blank">Terrorists</a> also remain a very difficult threat as they are seeking cooperation with criminal organizations in order to launder or make money and buy weapons and influence.</p>
<p>Thus, a license to commit crime can be useful to these secret agents. Of course, as always with these types of undercover operations taking place in the shadowy alley between our world and the underworld, we can only hope that the agents involved remember what side they are on.</p>
<p>Otherwise, we might be in for one hell of a mess.</p>
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Japan’s banks can reject loans to Yakuza gangsters
https://gangstersinc.org/profiles/blogs/japan-s-banks-can-reject-loans-to-yakuza-gangsters
2018-01-05T10:32:47.000Z
2018-01-05T10:32:47.000Z
Gangsters Inc.
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<div><p><a href="http://gangstersinc.ning.com/profiles/blogs/japan-s-banks-can-reject-loans-to-yakuza-gangsters" target="_blank"><img class="align-center" src="{{#staticFileLink}}9237011873,original{{/staticFileLink}}" alt="9237011873?profile=original" width="510" /></a>By David Amoruso</p>
<p>Yakuza mobsters looking for money need to find a loan shark with good rates, because Japanese banks will reject many of them when they apply for loans. As of yesterday, the Japanese Bankers Association stated that its branches will be able to screen individual loan seekers using the National Police Agency’s database of members of organized crime.</p>
<p>Organized crime in Japan is dominated by the <a href="http://gangstersinc.ning.com/profiles/blogs/yakuza-overview" target="_blank">Yakuza</a>, the country’s homegrown <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Mafia" target="_blank">Mafia</a>, which is involved in all the mob-staples such as extortion, gambling, drug trafficking, prostitution, and, of course, loansharking.</p>
<p>In recent years, authorities have cracked down on Yakuza activities by introducing tougher laws and placing gangsters under increased police scrutiny. This has caused a major blow to the group’s influence and resulted in a <a href="http://gangstersinc.ning.com/profiles/blogs/japan-s-yakuza-membership-continues-to-rapidly-decline" target="_blank">declining membership</a> and a split within its largest and most powerful clan, the <a href="http://gangstersinc.ning.com/profiles/blogs/yakuza-boss-yoshinori-watanabe" target="_blank">Yamaguchi-gumi</a>, which is now divided and involved in an internecine gang war.</p>
<ul>
<li><strong>Read: <a href="http://gangstersinc.ning.com/profiles/blogs/yakuza-mob-boss-bludgeoned-to-death-outside-his-home" target="_blank">Yakuza mob boss bludgeoned to death outside his home</a></strong></li>
</ul>
<p>The added screening measures follow a huge 2013 banking scandal involving the Mizuho Bank, one of Japan’s biggest financial institutions, which was found to have made 230 transactions with individuals with connections to the <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Yakuza" target="_blank">Yakuza</a>. The total amount of loans came down to 200 million yen.</p>
<p>With this new screening banks can connect to the police database through the government-affiliated Deposit Insurance Corporation of Japan. If the person comes up in the database, the local police department will be asked to conduct further identification. If they confirm the person is an associate or member of the Yakuza, the bank can reject the loan.</p>
<p>That will leave these gangsters with no other option than to take to the streets and find a friend to offer them a loan. Such a loan, however, will be difficult to use to pay for a house. Of course, in money laundering 101 there are plenty of ways around such financial blockades. Just ask any CEO of a Fortune 500 company. </p>
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Chinese woman laundered £1.8 million in drugs money for Albanian organized crime group in just two weeks
https://gangstersinc.org/profiles/blogs/chinese-woman-laundered-1-8-million-in-drugs-money-for-albanian-o
2017-11-22T04:30:00.000Z
2017-11-22T04:30:00.000Z
Gangsters Inc.
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<div><p><a href="http://gangstersinc.ning.com/profiles/blogs/chinese-woman-laundered-1-8-million-in-drugs-money-for-albanian-o" target="_blank"><img class="align-center" src="{{#staticFileLink}}9237095499,original{{/staticFileLink}}" alt="9237095499?profile=original" width="600" /></a>By David Amoruso</p>
<p>The biggest problem with ill-gotten gains is how to turn them into squeaky clean gotten gains. Because criminal money remains vulnerable to being confiscated by authorities, whereas money laundered clean has no way whatsoever of ever being touched by law enforcement as the recent Panama Papers leak has showed.</p>
<p>Of course, getting caught in the process of laundering these monies will get you – and your money - in trouble. <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=China" target="_blank">Chinese</a> money launderer Fen Chen knows this all too well. On Monday, she was sentenced to over 6 years in prison after being found guilty of laundering almost £2 million in criminal cash into <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=London" target="_blank">London</a> high street banks in a period of just two weeks.</p>
<p>32-year-old Chen and three others took bundles of bank notes into dozens of branches between 30 July and 15 August 2016. She was arrested by National Crime Agency officers shortly after accepting a bag containing more than £300,000 from Fation Koka, a 30-year-old who is a reputed member of an <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Albania" target="_blank">Albanian organized crime group</a>.</p>
<ul>
<li><strong>Read: <a href="http://gangstersinc.ning.com/profiles/blogs/albanian-organized-crime-gangs-are-taking-increasing-control-over" target="_blank">Albanian gangs taking increasing control over Europe's drug markets</a></strong></li>
</ul>
<p>Koka previously admitted two counts of money laundering and was jailed for 21 months. He will be deported upon completion of his sentence.</p>
<p>After Fen’s arrest, another £180,000 cash was discovered in bags and hiding places at her flat, along with bank slips detailing hundreds of deposits totaling £1.8 million. A cash counting machine was found in another room.</p>
<p>NCA officers found text messages on Chen’s and Koka’s phones that showed another cash handover happened in the same car park on 31 July 2016. That time, Chen was out of the country and instead sent representatives to collect the money.</p>
<p>“Fen Chen was a prolific <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Money" target="_blank">money launderer</a>, able to process millions of pounds in cash in a very short period of time,” NCA operations manager Kevin Gee said. “[She] was caught red handed in possession of around £300,000 belonging to an Albanian <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Drugs" target="_blank">drugs</a> gang.”</p>
<p>He continued, “Organized crime groups rely on money launderers like Chen, who play an integral part in allowing them to benefit from and re-invest their criminal profits. Taking money launderers out of the chain, as we have done here, makes life far more difficult and riskier for crooks trying to clean their dirty cash.”</p>
<p>Investigators obtained CCTV bank footage showing Chen, Lin and others deposited cash in smaller amounts to avoid suspicion. You can watch the video below:</p>
<p><iframe src="https://www.youtube.com/embed/BpZbu6448lg?wmode=opaque" width="560" height="315" frameborder="0" allowfullscreen=""></iframe></p>
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<li><strong>Back to the <a href="https://gangstersinc.org/profiles/blogs/europe-overview">European organized crime section</a> on Gangsters Inc.</strong></li>
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Greedy Sharks: The new rule for banking in Eastern Europe that makes fraudulent oligarchs billions
https://gangstersinc.org/profiles/blogs/greedy-sharks-the-new-rule-for-banking-in-eastern-europe-makes-fr
2017-05-22T12:56:19.000Z
2017-05-22T12:56:19.000Z
Gangsters Inc.
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<div><p><a href="http://gangstersinc.ning.com/profiles/blogs/greedy-sharks-the-new-rule-for-banking-in-eastern-europe-makes-fr" target="_blank"><img class="align-center" src="{{#staticFileLink}}9237086270,original{{/staticFileLink}}" alt="9237086270?profile=original" width="560" /></a>By John Christmas</p>
<p>Years ago, people in America talked about the “3-6-3 Rule” in banking. Bankers paid out 3% interest on deposits, collected 6% interest on loans, and were on the golf course at 3 o'clock.</p>
<p>But now in Eastern Europe, bankers have a new rule. They collect deposits, book “loans” that are actually uncollateralized transfers to mysterious shell companies, then they ask taxpayers to pay back the deposits. These bankers don't waste time playing golf and instead buy giant palaces, airplanes, or superyachts.</p>
<p>The champion of this concept of <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Banking" target="_blank">banking</a> is oligarch Ihor Kolomoisky. Based in Dnipropetrovsk, Ukraine, but with his family kept safe in Switzerland, Kolomoisky is best known as the billionaire former owner of Ukraine's largest bank PrivatBank.</p>
<p>Kolomoisky is extreme and eccentric even by the standard of his peers, the other Soviet oligarchs who continue to control the supposedly-democratic governments of <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Russia" target="_blank">Russia</a>, <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Ukraine" target="_blank">Ukraine</a>, <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Moldova" target="_blank">Moldova</a>, and <a href="http://gangstersinc.ning.com/profiles/blog/list?tag=Latvia" target="_blank">Latvia</a>.</p>
<p>Perhaps because of watching too many James Bond movies, Kolomoisky installed a gigantic shark aquarium in his office, with a remote control on his desk that drops meat into the tank. Imagine sitting on the other side of that desk and trying to negotiate a business deal!</p>
<p>He also maintains a private army. <em>The Wall Street Journal</em> published an estimate that he provides $10 million per month to maintain militias in Dnipropetrovsk. Supposedly the purpose of these militias is to defend Ukraine, however this mission isn't always clear. His soldiers have been known to show up at board meetings of major Ukrainian corporations, armed, giving the directors advice they can't refuse.</p>
<p>PrivatBank held 34% of Ukrainian bank deposits in December 2016 when it was suddenly nationalized. According to National Bank of Ukraine Governor Valeria Gontareva, PrivatBank made 97% of its commercial loans to related parties. She later increased this estimate to 100%. Now, the bank needs a capital injection of $5.6 billion from taxpayers to make up for all of that missing money.</p>
<p>This sort of fraud is remarkably easy for bank insiders to pull off, even with a Western auditor such as PWC at PrivatBank. Transfers that represent embezzlement or pay-offs can be booked as loans and the loss of the money can be hidden for years. The insiders can trick the auditors. For example, they can make multiple loans to the same oligarch by using different companies as borrowers without revealing that the borrowers are really one and the same. The insiders can also make fake collateral documents and arrange a few years of fake monthly payments to make it look like a loan, even though actually it was a gift.</p>
<p>Or, the insiders can organize the fraud with full knowledge of the auditors, assuming they can find auditors who will pretend not to know about it. It seems there is no shortage of willfully blind auditors these days, even at the major Western firms, since governments rarely prosecute auditors who sign false financial statements and sometimes governments do the opposite and encourage auditors to sign false financial statements.</p>
<p>A bank with a balance sheet loaded up with fake uncollectible loan assets only gets exposed if the bank needs to sell the assets, for example if a lot of depositors request withdrawals. This is how the modern-day phenomenon of bank bailouts has become very useful to crooks. Exposure of fraud can be temporarily avoided if the bank can borrow from the central bank to fund deposit withdrawals and therefore doesn't have to sell its assets immediately. Then, the central bank can turn around and make funding deals with the International Monetary Fund (IMF), audited by PWC, or sometimes even less transparent deals with the European Bank for Reconstruction and Development (EBRD), audited by Deloitte.</p>
<ul>
<li><strong>Read: <a href="http://gangstersinc.ning.com/profiles/blogs/how-russian-oligarchs-turned-the-country-of-latvia-into-their-own" target="_blank">How Russian oligarchs turned Latvia</a> into their own money laundering machine</strong></li>
</ul>
<p>I previously <a href="http://gangstersinc.ning.com/profiles/blogs/how-russian-oligarchs-turned-the-country-of-latvia-into-their-own" target="_blank">wrote</a> about how this process was applied in Latvia. Latvia is an offshore center for Kremlin-linked banks. In 2008-2009, the government decided to transfer about two billion euros to the largest of these, Parex Bank, to fund deposit withdrawals so that the bank wouldn't have to reveal that 50% of its assets were bad, including “loans” that were uncollateralized cash transfers to oligarchs. The government decided not to try to recover the lost money from the oligarchs or auditor EY. Instead, the loss was transferred to taxpayers thanks to an opaque arrangement with the IMF and EBRD which was confirmed to be a cover-up fraud when it was reversed in 2014. Amazingly, the IMF was able to get out of that by convincing ratings agencies to upgrade Latvia even though it's national debt doubled, and then having Latvia issue bonds that were mostly bought by the European Central Bank. Since the oligarchs remain in power, it's just a matter of time until Latvia will be asking for another bailout.</p>
<p>After the IMF/EBRD fraud in Latvia, but before the nationalization of PrivatBank in Ukraine, the IMF was involved in another major heist in Ukraine. In 2014, the IMF transferred $1.8 billion to the National Bank of Ukraine which transferred the money onward to PrivatBank which paid out the money to opaque foreign companies supposedly for imports which were never delivered. Some of that money was laundered through Latvia, where remember the IMF and EBRD were fraudulently supporting the offshore banking sector. The IMF also organized something similar with oligarch Victor Pinchuk's bank Credit Dnepr.</p>
<p>A similar IMF and EBRD project is now beginning in Moldova. In 2014, the central bank of Moldova transferred $870 million to three private banks: Banca de Economii, Unibank, and Banca Sociala, all with the same auditor Grant Thornton. The assets of those three banks had disappeared through uncollectible loans to mysterious offshore companies. Much of that money also disappeared through Latvia, using Parex Bank's successor AB.LV and PrivatBank's Latvian subsidiary. Therefore, that heist is also linked to the IMF and EBRD. Moldova has hired the attorney for the responsible oligarch to try to find the money he took, with the predictable result that the money is still missing. Therefore, the IMF made a funding package for Moldova which begins with $178.7 million package and doubtlessly will grow larger.</p>
<ul>
<li><strong>Read: <a href="http://gangstersinc.ning.com/profiles/blogs/russian-mafia-overview" target="_blank">The Russian Mafia section at Gangsters Inc.</a></strong></li>
</ul>
<p>Who suffers the loss? For now, the victims appear to be the taxpayers of Ukraine, Latvia, and Moldova who are expected to repay huge loans even though they didn't receive the loans. They seem like fools borrowing more and more and giving the money to oligarchs thus making their national debts higher and higher. However, maybe at the end of this we will discover that the victims will be American taxpayers. The U.S. government's IMF “quota” is 18%. And the U.S. government owns 10% of the EBRD. U.S. taxpayers are the biggest investors in both.</p>
<p>The total current funding package from the IMF to Ukraine is 17.5 billion dollars. The current funding package from the EBRD to Ukraine is 4.2 billion euros. The real amount owed is unknown since the IMF/EBRD fraud in Latvia in 2009 showed that a country's actual obligation can be larger than what is publicly announced. Presumably there will be a time, maybe when the total lending reaches 50 billion or 100 billion, when Ukraine will wisely repudiate the debt which anyway will be impossible to repay. What will the U.S. do then?</p>
<p>What are the IMF and EBRD trying to accomplish? They are supposed to be using Western taxpayer money to help the poor people in Eastern Europe with economic development. This is the reason why many Democrats and Republicans support the IMF and EBRD. The IMF and EBRD keep boasting that their bailouts are “rescuing” and “stabilizing” recipient countries. But can anyone honestly look at what the IMF and EBRD are doing and conclude that they are helping anyone, besides a tiny circle of billionaire oligarchs? The development banks demand “reforms” in their target countries, however the reforms don't include any real action, like arresting fraud perpetrators and taking back stolen money.</p>
<p>There is a more cynical alternative theory – that the IMF and EBRD are intentionally trying to destroy the countries where they are lending. Russian politicians started making such claims in the 1990s as their country was looted by oligarchs and the IMF and EBRD were involved. Popular left-wing book “<em>Confessions of an Economic Hitman</em>” by John Perkins contains insights into the minds of the so-called “development bankers.” Perkins, an insider familiar with IMF bailout packages, describes the problem as “greed” when development bankers design loans such that the proceeds are stolen by a few corrupt officials and the impoverished local population of the target country cannot repay and therefore is forced to borrow ever-increasing amounts. He says the purpose is to gain control over the nearly-defaulted borrower. It is a strange sort of “greed.” I worked in bank lending in the U.S. in the 1990s and I always understood that banks wanted borrowers to repay the loans.</p>
<p>Maybe the problem is that the IMF and EBRD won't be necessary anymore if they actually crackdown on corruption. Nobody would need bailout loans anymore.</p>
<p>Getting back to Ukraine, there is a battle to recover assets. However, the battle isn't between the government and the oligarchs. Rather it is between Pinchuk and Kolomoisky.</p>
<p>The two oligarchs are feuding about ownership of former Ukrainian state assets. The dispute has been going on partly in court in London and partly in the media. Each oligarch produced evidence that the other oligarch was threatening and killing people.</p>
<p>In the middle of this, Kolomoisky made an astonishing confession to the Ukrainian Parliament that he controlled state oil company Ukrnafta by paying $5 million per month protection money to Pinchuk. Had Kolomoisky gone insane? Why did he publicly describe his own corruption, for which he could go to prison for many years? However, it seems that he isn't insane because the parliament and prosecutors ignored the confession and took no action. I guess he knows them better than we do.</p>
<p>Can anything change? It seems impossible that this new rule for Eastern European banking can be sustainable forever. Maybe Western countries will stop funding the IMF and EBRD or more whistleblowers will come forward from the governments of Ukraine, Latvia, and Moldova. I don't know. However, I'm sure National Bank of Ukraine Governor Valeria Gontareva won't get in Kolomoisky's way anymore. She resigned last month when someone placed a coffin in front of her door, with an effigy of her head inside.</p>
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