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Australian Watchdog Frets Over BitCoin, MMOs' Money Laundering Potential 134

angry tapir writes "Australia's anti-money laundering watchdog AUSTRAC believes that money laundering using digital currencies such as Bitcoin and virtual worlds (such as MMOs) are possible 'emerging threats'. The organisation's latest 'typologies' report earmarked virtual worlds and Bitcoin as two areas that the agency would be monitoring, although at this stage no-one seems sure to what extent they are being used (and some of the issues with Bitcoin, such as the fluctuating exchange rate and limited options for transferring value to real-world currencies through conversion to non-digital currencies or using it to pay for goods or services, mean that it's unlikely it's being used for money laundering on a significant scale)."
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Australian Watchdog Frets Over BitCoin, MMOs' Money Laundering Potential

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  • by swb ( 14022 ) on Thursday August 16, 2012 @11:17AM (#41011505)

    Isn't this the "old school" way of laundering money?

    Either through outright purchase or, more commonly, strongarm, gain control of a business that does a lot of cash transactions -- bars, restuarants (cheap ones now), vending companies, taxis, anyplace people spend cash. Also gain control or create a business that acts as a vendor to that business on a regular basis (food wholesaler or other supplier).

    The dirty money goes in as revenue to the cash-heavy business as bogus sales. Some money comes out "clean" as the business profits, but probably more of it comes out "clean" as payments to the suppliers. This allows you to offset your fake sales revenue (which is dirty cash input) with fake supplier sales so you don't have to account for, say, a million cans of coca cola or a couple of tons a beef a week.

    Anyway, I've always been told that this is why the mob has been big in vending.

  • by Anonymous Coward on Thursday August 16, 2012 @02:09PM (#41014031)

    So you put an extra 10 bucks of 'dirty' money into a business each month. Since all the operating costs are already paid, this money goes right to the bottom line. This extra 10 dollars a month increases the bottom line by 120/year. Now it is time to sell the business. It sells at a multiple of earnings. Let us say 5 times.

    So $10 x 12 months x 5 P/E = $600

    That 10 bucks a month has increased the sale value of the business 60 times.

    Pretty cool, eh?

    And IF the 'dirty' money is what pushes the business from loss to profit, ouch, that new owner has got some real problems. Buyer Beware.

    The numbers might be a bit off, but it illustrates the concept.

    Moral of the story is that you need a good accountant. He will find stuff like this. He knows all the tricks. He has too. He would not be a good accountant if he did not. They don't put these tricks in books or on the internet. Find a really old guy that has done audits on Governments and Megacorps. If he has a non-assuming ten year old car that goes really really fast, you have your guy.

    If you have ever seen Yodi the Beancounter do an audit on some amateur bookcooker, the most terrifying thing is how fast he finds the frauds. He will walk right up to exact one of the myriad of filing cabinets, and pull out the exact file, and poof, you're busted. It is indistinguishable from magic.

    The Government has some really scary good auditors. Some of the best.

    Guns, God and GAAP. The three pillars of civilization. Laugh if you like. But when you reach a certain point in the game, when you violate GAAP with a crooked set of books, in many people's minds, you have violated one of the 3 holy of holies. Expect wrath and retribution of biblical proportions. You have been fairly warned.

    Oh, and don't do drug deals over the phone. Ever.

    Don't do drug deals over the internet.

    You are doing something illegal and then the police do something illegal to catch you, you get all holy with the righteous indignation? What is that? That is unclear thinking. If you chose to break the law, do not whine. Be a man about it. There are no safety nets.

    When you break the law, you are a 'Bad Guy'. This means the 'Good Guys' can do 'whatever it takes' to bring you to justice. The good guys are holy, doing God's work. You are evil scum slime, with no rights at all. You deserve to be punished. Cast into a lake of fire. Zero Tolerance. The means justifies the end. This is how they think. GOT IT?

    Seems obvious, but here we are discussing it. Maybe their parents did not teach them. The police are not your friends. The government is not your friend. The Establishment and the Man are out to get you and fuck you up. The media is out to deceive you. The law is there to keep you in your place, to exploit you, to steal the fruits of your labors. It always has been, It always will be.

    None of this is on the internet because it is illegal stuff. There is no 'How to Launder Money' site. There is no 'Making a safe dope deal' site. There is no 'Dial A Doper App' with encryption and good data retention laws. The dope vendor is a felon and you cannot call the cops or take him court.

    When you break the law, you are going past the point on the map where it says "There be Dragons". There is no app. Jail sucks. You friends will rat on you faster than you can say "Mark Zuckerberg"

    Maybe dope should be legal. Maybe tax rates should be low enough that nobody needs to launder money. Or put it offshore so a greedy debt ridden governments do not seize it. Maybe if there were enough good paying jobs people would not need to do so many crimes. These are the real issues.

    So to close, there is a whole dark world of knowledge on how to survive and prosper when the system gets corrupt from top to bottom. The price of failure in this world however is Jail and Death.

    But I would rather spend my time pushing back the darkness, and focus on saving this civilization. I would rather the system worked, that is stays honest. That stupi

  • by zlives ( 2009072 ) on Thursday August 16, 2012 @02:51PM (#41014673)

    launderer legitimately own a casino.
    launderer or a hired hand shows up with a suitcase full of 100 bills.
    bet it all on black and double down until lose.

All science is either physics or stamp collecting. -- Ernest Rutherford