About 6 years ago, Wachovia Bank (now part of Wells Fargo) was busted laundering billions of dollars for Mexican drug cartels.
Although the DEA, Mexican government and involved entities are known to selectively turn a blind eye to certain drug trafficking activities, the DEA, IRS, and other entities conducted a 22-month long investigation into Wachovia’s activities.
This culminated into a bust on April 10, 2006, when a DC-9 jet was found with 128 cases loaded with 5.7 tons of cocaine, a $100 million bust in the Gulf city of Ciudad del Carmen.
After the bust, authorities revealed that billions of dollars in cash shipments, wire transfers, and traveler’s cheques were laundered through Mexican exchanges into Wachovia bank accounts.
Criminal proceedings were never brought against the bank, and the case was never brought to court. They were simply too powerful to be held accountable.
According to the Guardian:
“In March 2010, Wachovia settled the biggest action brought under the US bank secrecy act, through the US district court in Miami. Now that the year’s “deferred prosecution” has expired, the bank is in effect in the clear. It paid federal authorities $110m in forfeiture, for allowing transactions later proved to be connected to drug smuggling, and incurred a $50m fine for failing to monitor cash used to ship 22 tons of cocaine.”
So the authorities hustled some money, and the bank received no punishment. Knowing that the DEA has been historically linked to the drug trade, as all regulatory agencies seem to do the exact opposite of what they are alleged to do, why did they only make this particular bust when it comes to banks laundering money?
Could it be that this was simply too obvious for the DEA to not bust without losing credibility? Maybe so, considering that the bank was laundering a whopping one-third of Mexico’s gross national product- $378.4 billion dollars that we know of.
On the other hand, Wells Fargo now owns Wachovia and the big banks continue doing their thing.
And now a recent development on banks laundering money has come to light, to put this story in perspective. Australian Commonwealth Bank was recently busted for laundering money in a similiar fashion. According to ABC:
“The Commonwealth Bank has been accused of “serious and systemic” breaches of anti-money laundering and terrorism financing laws that could leave it exposed to massive civil penalties.
The Australian Transactions Reports & Analysis Centre (AUSTRAC) today launched civil proceedings in the Federal Court alleging that the Commonwealth Bank failed to comply with the law on 53,700 occasions.”
However, this case just might be an effort to raise hype in the Australian media about terrorists and drug trafficking. As word has it from people I know in Australia, there is very little crime or terrorist activity there, and the government has been eager and a little desperate to generate its annual amount of fear to justify the state encroaching further and further upon people’s freedom. For example, any instance of drug trafficking or minor bust is featured prominently on the news in Australia, such as Channel 7 news, owned by Yahoo.
So what can we take away from all this? All banks probably launder money. Some of the highest echelons of power in this entire world lie in international banking: the Bank For International Settlements, World Bank, IMF are some power players who dominated the last Century and this one as well.
Commercial banks such as Wells Fargo or Commonwealth Bank, investment banks such as Goldman Sachs, international banks such as the IMF, these are some of the most powerful entities on the face of the planet and you can bet every single one of them is complicit with morally reprehensible activity from money laundering to financing war and terror.
This is what the world is made of. You could call it corruption, but that one word does little justice to the full picture.
(Image credit: farm4.staticflickr)