Classic Money Laundering
The classic money launderer was someone who had illicit income — drug dealer, jewel thief, con man — and worried that he’d get the Al Capone treatment and be convicted of tax evasion even if the government couldn't pin any of the underlying criminal activity on him.
If the illicit income is small — and especially if you also have a straight job that you do pay taxes on, there's no need to do any money laundering. For example, suppose you work in some cube farm that pays most of what you need to live on, but you also turn the occasional trick to bring in a hundred dollars a week. You probably don't need to launder that money.
But suppose that illicit income is a bit larger. Once you've got more than a few hundred dollars a week — more than can be conveniently hidden in your ordinary cash expenses — you've got a problem. As soon as you do anything with the money — spend or invest it — it might well come to the attention of the tax man.
The solution — classic money laundering — is to create a business to ostensibly earn that money. Any business that brings in a good deal of cash will do. You run the business as usual during the day. Then, after closing, you feed in your day's illicit receipts, pretending that they'd been received by the business. In due course the business pays its taxes and all the tax man can see is that you’re running an unusually profitable business.
Modern Money Laundering
The other thing sometimes called money laundering is when you have some big lump of cash that you'd rather not have people find out about. Sometimes it’s an effort to keep the money from the tax man (literally the opposite of classic money laundering), other times the goal is to keep it from coming to the attention of someone else who might feel like they have some claim to the money — an ex-spouse, a creditor, the guy who owns the land where you found the bag of gold coins in the culvert.
In this kind of money laundering, the point is to make the money disappear. This is the sort of money laundering where you might make use of foreign banks, shell companies, and so on. There are two parts to these strategies. First, you need to make the money disappear. Second, you need to make it reappear in some gradual fashion that doesn't bring it to the attention of whoever you're trying to hide it from.
Notes
illicit– незаконный, противозаконный
drug dealer –наркоторговец, наркоделец
con man –жулик, мошенник
tax evasion– незаконное сокрытие доходов, подлежащих налогообложению; уклонение от уплаты налогов
to underlie– лежать в основе, обусловливать
criminal activity –преступная деятельность
to suppose –предполагать, допускать, считать
occasional –случайный, нерегулярный, редкий
conveniently– удобно, удачно
to invest – инвестировать, вкладывать денежные средства
attention–внимание
solution– решение, объяснение
to create –создавать, творить, вызывать
ostensibly –по видимости, якобы
effort –усилие, попытка, стремление
claim –требование, заявление, иск
culvert –подземный коллектор,водопропускная труба
2. Read the text again to answer the following questions:
1. What are the best known ways of money laundering?
2. Who is considered to be a classic money launderer?
3. Is there a need to do any money laundering, if the illicit income is small?
4. What do people usually do if their illicit income is large?
5. What is the classic money laundering solution?
6. What is the goal of a person who has a big lump of cash?
7. In what sort of money laundering is it possible to use foreign banks, shell companies, and so on?
8. What are the main strategies of modern money laundering?
3. Translate the following words and word combinations from English into Russian:
completely, classic money launderer, illicit income, drug dealer, jewel thief, con man, convicted, criminal activity, to pay tax, to suppose, occasional, conveniently, cash expenses, problem, to invest, attention, solution, ostensibly, to run the business, profitable business, lump of cash, culvert, to disappear, shell company, to reappear, gradual, attention.
4. Find the English equivalents for the following words and phrases:
предполагать, незаконный, наркоторговец, жулик, случайный, решение, иск, уклоняться от уплаты налогов, усилие, внимание, доход, возможно, получать, управлять, доходный бизнес, последовательный, получать, незаконная деятельность, стратегия.