When the Bush administration; came into office, I wanted to raise the profile of our efforts to combat terrorist financing, but found little interest. The new President's economic advisor, Larry Lindsey had long argued for weakening U.S. anti-money laundering laws in a way that would undercut international standards. The new Secretary of the Treasury, Paul O'Neill, was lukewarm at best toward the multi-lateral efforts to "name and shame" foreign money laundering havens, and allowed the process to shut down before the status of Saudi Arabian cooperation was ever assessed.
Lindsey was far too too much a realist to last long in the Bush adminiStration (BS). That he would from time to time speak inconvenient truths should not have shocked the BS. While a governor of the Federal Reserve, in September of 1996 he is reported to have challenged the assumption that corporate profits would continue to grow at an annual rate of 11 1/2% annually saying, "Readers of this transcript five years from now can check this fearless prediction: profits will fall short of this expectation."
He was fired by BS for estimating the costs of the invasion and occupation of Iraq to be between $100 and $200 billion, which he arrived at by estimating the annual costs to be about one percent of GNP for each year of the endeavor. He assumed a two year maximum time frame. Rumsfeld could not abide such frankness so Lindsey was subsequently axed.
Most interesting here is "Lindsey's long held position that U.S. money-laundering laws should be weakened." Obviously such a weakening would make U.S. banking/financial institutions more attractive to money launderers. It might also mean that banking/financial institutions that were "flirting" with violations of the law would be less likely to get caught, or perhaps, get retroactive immunity.
Former Treasury Secretary Robert Rubin was concerned with "capital flight" and the possibility that banks from other nations concerned with the "sanctity" of bank secrecy would complain.
So, just exactly how MUCH money-laundering goes on in in the good old U.S. banks, or international conglomerate financial institutions chartered in or doing business here? What is the extent? What is the scope?
One is unlikely to ever know. However, some interesting corporate / legal / political relationships emerge, looking swamp-like.
In August, 2000, the Washington law firm of Akin, Gump, Strauss, Hauer & Feld was hired to sue the Mexican newspaper Por Esto and internet web journal NarcoNews in New York City for slander, libel, and damage to Banamex business (Mexico's second largest bank) in a rehashing of a suit that had previously been tossed three times by Mexican courts because they found the charges leveled against Banamex owner Roberto Hernandez were valid.
The Strauss of Akin, Gump et. al. is Robert S. Strauss, former FBI agent, former Chair of the Democratic National Committee, former U.S. Ambassador to the Soviet Union and then the Russian Federation. currently chairman of the U.S.-Russia Business Council, a member of the Council on Foreign Relations, and a trustee for the Center for Strategic and International Studies.
On Sept. 6, 2001, then California State U.S. Congressional Representative Cynthia McKinney wrote a letter to Ambassador Strauss asking that his law firm drop their suit, arguing that:
[T]he recent agreement to sell Banamex to Citigroup for $12.5 billion, the claims made of economic damage to Banamex by a low-budget web site and by valiant independent journalists are ludicrous. This case should never have been brought to Court. There is no libel to be found in this situation, and the lawsuit is without merit. A difference of opinion in the characterization of a person or persons, based on documented fact, does not constitute libel, as the courts have established.
