From: tcmay@netcom.com (Timothy C. May)
Date: Sun, 17 Apr 94 18:47:26 PDT
To: hughes@ah.com (Eric Hughes)
Subject: Re: Laundering money through commodity futures
In-Reply-To: <9404180119.AA00279@ah.com>
Message-ID: <199404180148.SAA13372@mail.netcom.com>
MIME-Version: 1.0
Content-Type: text/plain


> 
> Ever been suspicious of the run-up in prices of Impressionist
> paintings by the Japanese a few years ago?  Give someone an
> inexpensive painting (or have them buy it), and then buy it at an
> inflated rate from them, at auction.
> 
> Eric

Not only that, but paintings were a favored way to transport large
amounts of cash in a compact form across U.S. borders. From the
article I read about 2 years ago, in "ArtWeek" or somesuch (I don't
normally read it...I just saw the story mentioned on the cover, in
connection with why so much art is being stolen, used as collateral,
moved around, etc.), art does *not* have to be declared at Customs at
the U.S. border, either coming or going.

So, a Columbian cartel member wishing to move $10M into or out of the
U.S. can carry Picasso's famous "Young Girl Encrypting a File" in his
luggage and not have to worry.

The same article mentioned that bribes were often paid to people by
selling them artworks at "artificially low" prices. (The notion that
there is some "true" or "market" price for thinly-traded things like
paintings is at issue here. Many opportunities for tax evasion, money
laundering, and bribes. And not much the government can do about it.)

Ironically, I saw Peter Wayner's article in "RISKS" a few days ago and
was preparing e-mail to him noting the similarity of what he talked
about to Hillary Clinton's sweetheart deal...then Netcom crashed and I
never did send the mail.

"Insider nontrading" is another gem of an idea.

--Tim



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