CAPITALISM'S ACHILLES HEEL Dirty Money and How to

42 CAPITALISM’S ACHILLES HEEL
Drug dealers in North America and Europe, for example, face the problem
every day of disposing of large amounts of cash. For a small local distributor
with a take of perhaps a million or two a year, the simplest way to
launder cash without detection is “smurfing”—using innocuous-looking bagmen,
named after the cartoon characters, to deposit a few thousand dollars at
a time into variously named accounts at many different banks. Due diligence
procedures at such banks, alert to cash transactions of more than $10,000,
rarely catch this activity. Drug kingpins with tens or hundreds of millions of
dollars in cash in assorted denominations, weighing several tons and occupying
a volume five times larger than the drugs themselves, have a more onerous
laundering task. Smurfing won’t work because it would require hundreds of
innocuous-looking bagmen making repeated trips to the banks, not to mention
the control problems arising from those bagmen foolish enough to try to
abscond with their day’s deposit. Using cash to live high and buy cars and
houses isn’t very smart and fails to soak up much of the millions. So basically
the kingpins are left with two choices, both of which move the transactions
into the international arena: ship cash or ship goods overseas.
“Mules” carry suitcases of cash to island tax havens for deposit, a bit
risky nowadays with heightened airport security. Couriers hide cash in their
clothing, wrap it around their bodies, conceal it in their onboard luggage, or
hide it in checked baggage.
More commonly, unaccompanied cash is hidden in something being
shipped abroad: appliances, overstuffed furniture, machinery, industrial products,
coffins, or even dead bodies. This form of handling drug profits has
soared in recent years, as customs authorities in western countries pay more attention
to what’s coming in than what’s going out. A few million dollars inside
nicely packaged computers and printers shipped from ABC Technical to XYZ
Technical is unlikely to arouse suspicion and, once retrieved, can be easily legitimized
in countries with lax controls on large currency deposits.
Something very much like smurfing can be combined with the Black
Market Peso Exchange system to handle large transactions. A Colombian,
later identified as having links to the drug trade both in his own country and
in the United States, approached the local sales agent of Bell Helicopter to
arrange purchase of a used chopper. Bell accepted the order at $1.5 million
and in 1998 received 30 wire transfers and one check covering the price,
none from the purchaser. 11 The company placed a telephone call to the
American Embassy in Bogotá asking about the buyer, and did not receive a