Kenneth Rijock

Kenneth Rijock

Wednesday, August 10, 2016

TRADE BASED MONEY LAUNDERING USING A FREE TRADE JURISDICTION







The method, you have to admit, is clever. You have US Dollars, a drug profits earned in the Continental United States, and you must repatriate those profits, and turn them into Pesos, in Mexico, where one can not longer easily convert currencies. Can it be done ?

Here is the technique, a rather unusual take on trade-based money laundering:

(1) The Mexican Cartels transport their dollar profits to the Los Angeles Fashion District, where they purchase, for cash, large quantities of clothing suitable for retail sale. This answers the question many people always asked: why are bulk cash smugglers always going to California, instead of the Mexican border, with their deliveries ? You now have an answer for some of that cash.
(2) They ship the clothing, in bulk, into Mexico; it is exported free of duty, due to NAFTA.
(3) The clothing is thereafter sold in trafficker-controlled stores in Mexico, effectively laundering the drug proceeds, and, more importantly, turning it into perfectly usable Pesos. The drug trafficker has now defeated the Mexican Government's ban on Dollar-Peso conversions, through retail sale.


2 comments:

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  2. How much more difficult it would be for those awful drug lord money launderers if there was no prohibition, only labeling standards for purity and quality and free competition on price ruled by market demand. How much police, court, prison, violence and lives ruined costs could be completely eliminated by eliminating the law imposed cartel through open competition. Government wants high taxes and regulatory cartels so that the drug war can be continued because it is very profitable..... to government.

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