From: pcw@access.digex.com (Peter Wayner)
Date: Thu, 19 Jan 95 08:39:36 PST
To: cypherpunks@toad.com
Subject: Anonyous Cash through Options Trading
Message-ID: <ab44451200021004c44d@[199.125.128.5]>
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Several months ago, there was a discussion at length about how one
could use the futures and options markets to transfer funds anonymously.
This week's edition of Forbes magazine (Jan 30, 95)
has the headline, "OIL! GUNS! GREED! Was Chase Manhattan ripped off by arms
traffickers?" In the story, Forbes guesses that some suspiciously large
losses in the options market could have been a smoke screen for money
laundering:

  Oil traders do big business in unlisted options, providing
  a further smoke screen. Perkins points to deals in which
  Harris would buy a put option on a cargo of crude from a
  friendly counterpart like Bayoil and resell a similar contract
  in the oil market. If oil prices climbed, the put would expire
  worthless and Bayoil would pocket the price of the option,
  while Arochem would break even. If oil prices dropped, and the
  ultimate buyer exercised the put, Arochem could absorb the
  loss while conveniently neglecting to exercise its put against
  Bayoil, Perkins theorizes. (pg 87)