Liberty Reserve, “Bank of Choice for the Criminal Underworld”

Liberty reserveKurt Eichenwald likens the latest massively fraudulent bank scandal at Liberty Reserve to BCCI (remember them, the terrorist bankers of choice?), at Vanity Fair:

Another day, another alleged fraud. But this one—brought to light by the federal indictment of Liberty Reserve, which prosecutors said was one of the world’s largest online money operations—sounded a little bit too familiar.

According to the charges, the operators of Liberty Reserve constructed an extremely complex international network for financial transactions that allowed its customers to transmit vast sums of money around the globe, all while operating under layers of anonymity. As a result, the indictment says, “Liberty Reserve was in fact used extensively for illegal purposes, functioning in effect as the bank of choice for the criminal underworld.”

If that rings a bell for any of you fraud aficionados, think back to 1991 and the virtual financial explosion of a shadowy international institution called the Bank of Credit and Commerce International, best known as B.C.C.I. While the two scandals have their differences, in both instances—if the charges against Liberty Reserve are true—the companies established virtual international spiderwebs of financial links, giving both the ability to avoid effective regulation of their operations.

Just read the descriptions in official documents. From the Liberty Reserve indictment: “Throughout its operation, Liberty Reserve and its principals sought to thwart effective regulation by anti-money laundering authorities and to evade the reach of law enforcement.” Then B.C.C.I. as described in a Senate report about the bank: “The structure was conceived . . . for the specific purpose of evading regulation or control by governments.”

Then the alleged crimes. Liberty Reserve, as described in the indictment: “The company grew into a financial hub of the cybercrime world, facilitating a broad range of online criminal activity.” B.C.C.I., from the Senate report: “(The principals) developed in BCCI an ideal mechanism for facilitating illicit activity by others.”…

[continues at Vanity Fair]


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17 Comments on "Liberty Reserve, “Bank of Choice for the Criminal Underworld”"

  1. Sounds just like the article at Salon. Is there some top-down messaging here? Expect to see more of this.

    Difference between BCCI and Liberty Reserve? BCCI criminals were connected.

    • BuzzCoastin | May 28, 2013 at 9:16 pm |

      another way to say that is:

      Difference between BCCI and Liberty Reserve?
      BCCI is a CIA money laundering outfit
      LR is not

      • Craig Bickford | May 28, 2013 at 10:51 pm |

        Well BCCI had mob connections also I believe, so it’s gets a little gray as to who controlled what exactly.

  2. Simon Valentine | May 28, 2013 at 7:33 pm |

    criminal underworld?
    criminal according to what story of a story?

    show me the money
    show me the people
    show me crimes of the people shouting CRIME
    the mission is about to go zergical…
    …and creep

    money laundering anti-money laundering authorities?
    laundered money anti-(money laundering) authorities?
    authoritity worshipers?
    authority under the influence of illegal sithdom? (oh look out)
    orthodox scum of the facade? ha ha now there’s an oxymoron.

    “…for the specific purpose of evading regulation or control by [sic] governments.” where [sic] is, well, any ad verbatim, adjective, or the entirety of reality sans ‘authistoriocracy’, really. (sounds like a dinosaur)

    torrent sharing sites
    you don’t think this is the only ‘meta bank’, yeah?

    “i keep my money in virtue” said the knight.

    in regards to rebuttals concerning investigation, knight says:
    “is it the fact that you can’t [justify the entirety], irregardless of whether or not you have done an [immoral] action?”

    so says sir knight, who performs well in the chivalrous duties that are investigation concerning obstruction of justice, contempt of court, and personalizing the impersonable madam justice.

  3. BuzzCoastin | May 28, 2013 at 9:22 pm |

    Uncle Homeland’s Funny Money is being attacked from many sides
    the BRICS are now settling trade in their own currencies, not $
    BitCoin is finding niches of use unheard of 5 years ago
    LR, Pecunix and a host of others
    merely follow the financial designs created by corporations:
    hide assets off shore, obfuscate financial records & cheat whenever possible

  4. what do libertarian and tea partiers think about this?

    • $34266836 | May 29, 2013 at 1:49 pm |

      A true libertarian would not care.

      • sveltesvengali | May 30, 2013 at 3:18 am |

        I didn’t know that whatever opinion you’re referring to held the trademark or monopoly on the term “libertarian.”

        • $34266836 | May 30, 2013 at 6:58 am |

          I hold a monopoly on my own thoughts & opinions. You & yours will never matter.

          • sveltesvengali | May 30, 2013 at 6:01 pm |

            It all depends on the context, I suppose, because everything matters within some context, be it your opinion or mine…and how it matters is another matter entirely.

          • lets see how far that lack of empathy will get you

  5. InfvoCuernos | May 29, 2013 at 12:09 am |

    Does anyone know if there’s a minimum on their money stashing program? I have a couple hundred dollars I’d like to keep out of Uncle Suck’s hands.

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