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Monday, February 16, 2009

Drug Money Saves Banks

It would appear, that the criminal masterminds of the under ground economy apply 'conservative' leverage and tend to be 'highly liquid'.

How ironic is it that there were "signs that some banks were rescued in that way." Drug money rescued reckless and corrupt banks.

Impressive... and sad.... at the same time.

I'm willing to bet that a really neat consequence of accepting 'drug money' to save your bank is a rather sudden abolition of ridiculous management bonuses... cuz even banksters know not to mess with gangsters.

UN crime chief says drug money flowed into banks: "The United Nations' crime and drug watchdog has indications that money made in illicit drug trade has been used to keep banks afloat in the global financial crisis, its head was quoted as saying on Sunday.

Vienna-based UNODC Executive Director Antonio Maria Costa said in an interview released by Austrian weekly Profil that drug money often became the only available capital when the crisis spiralled out of control last year.

"In many instances, drug money is currently the only liquid investment capital," Costa was quoted as saying by Profil. "In the second half of 2008, liquidity was the banking system's main problem and hence liquid capital became an important factor."

The United Nations Office on Drugs and Crime had found evidence that "interbank loans were funded by money that originated from drug trade and other illegal activities," Costa was quoted as saying. There were "signs that some banks were rescued in that way."

Profil said Costa declined to identify countries or banks which may have received drug money and gave no indication how much cash might be involved. He only said Austria was not on top of his list, Profil said."


Dan said...

This is nothing new. Why do you think national intelligence agencies deal in the black market? To fund covert ops off the books, yes, but also to pump liquidity back into the US economy. Its why we're so interested in Afghanistan, Colombia, Burma, Turkey, Eastern Europe... hell, even Iraq has a heroin problem now.

It's not exactly a secret that the global financial system floats on an ever-growing sea of drug money. But the debts blew up, and no amount of drugs sold will help now.

Anonymous said...

Which banks? I hope they go up on Rico charges. Any bank taking drug money had better be shut down and buried at least 6 feet under.

Jerry Gene said...

I really like your writing style. Nice Post keep it up.

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