Did Drug Money Save the Banks??

~~By InsightAnalytical-GRL

As if things couldn’t get even MORE bizarre…

The Guardian/Observer is reporting that the UN’s Office on Drugs and Crime suspects that “$352bn in criminal proceeds was effectively laundered by financial institutions” during the 2008 banking crisis:

Drug money saved banks in global crisis, claims UN advisor

snip

Antonio Maria Costa, head of the UN Office on Drugs and Crime, said he has seen evidence that the proceeds of organised crime were “the only liquid investment capital” available to some banks on the brink of collapse last year. He said that a majority of the $352bn (£216bn) of drugs profits was absorbed into the economic system as a result.

This will raise questions about crime’s influence on the economic system at times of crisis. It will also prompt further examination of the banking sector as world leaders, including Barack Obama and Gordon Brown, call for new International Monetary Fund regulations. Speaking from his office in Vienna, Costa said evidence that illegal money was being absorbed into the financial system was first drawn to his attention by intelligence agencies and prosecutors around 18 months ago. “In many instances, the money from drugs was the only liquid investment capital. In the second half of 2008, liquidity was the banking system’s main problem and hence liquid capital became an important factor,” he said.

Some of the evidence put before his office indicated that gang money was used to save some banks from collapse when lending seized up, he said.

Apparently, evidence of the drug money going to banks has come from officials in Britain, Switzerland, Italy and the US.

The British Bankers’ Association wants to see the evidence and maintains that central banks provided the liquidity to keep the system afloat.

It will be interesting to see if Costa’s suspicions get any attention here in the U.S.

Imagine, “money laundering”  to save the economic system…

Who pays back THOSE “loans”??

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8 Responses

  1. The British Bankers’ Association wants to see the evidence and maintains that central banks provided the liquidity to keep the system afloat.

    That would presume that we believe that the Central Bank is not involved in drug trafficking. Given the fact that they are supporting (the Taliban side of) a war in Afghanistan with heroine sales, I’d say the accusations hold quite a bit of water.

  2. This is huge news — and yet apparently is being ignored by the US media.

    The implications are huge — and the banks really don’t want to lose the big $$ from the drug profits. So is this a way from them to get regulators to look the other way??

    Thanks for reporting this — I read it a few days ago and since then no one is touching this topic with a 100 foot pole.

  3. Thanks for the article, IA. I kept hoping that some good soul in the MSM would pick up this story and go with it, but I guess we don’t have good souls in the MSM anymore. It’s up to the bloggers to keep us aware of the dangers and corruptness in today’s world.

  4. We have no reliable news sources in the MSM anymore. MSM and Government are so in bed with each other that I’m expecting a birth announcement any day now.

  5. Yeah, something like that. Rosemary’s baby?

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