Historias De Guilherminho

The Godfather

The Corleone Family is one of the biggest and powerful criminal organization of the 20th century. Their activities started in 1920, New York city, by Vito Corleone. Most of the family money were made during the prohibition era, when was mostly prohibited to product, import, sale or transportate any alcoholic beverage through legal ways.

Between the years of 1920 and 1955, Vito was still the head of the family, and made a lot of money mostly through illegal ways, using shell companies as a way to launder their money. However, in the year of 1955 he dies and his son, Michael as supposed to assume the family. However he decided to legitimate the family business and invest in the gambling business in Nevada State.

Now, the Corleone family needs a new boss, and a new business to continue with its growth. The new strategy for the family will be opening a bank, in order to diversify the business and expand their opportunities. However it's not an easy task to do, there are many factors to take in consideration, many barriers but on the other hand, also a lot of benefits can be achieve in this new strategy.

For most criminal organizations, using the money they get through their activities is a tough task. The problem is that they have too much liquid cash, and depositing a big quantity of money into banks or spending live cash to buy real estate, or other expensive items would raise a red flag with various government agencies. In the end, is just not practical to have a lot of money and not being able to use it. To solve this kind of issue exists methods available to cleanse the money and make it easy to spend. This process is called “money laundering”.

Money laundering can be done in a big variety of ways, but the most used ones are structuring deposits, through banks, shell companies, legitimate business and gambling.

The first one, structuring deposits, consist in hiring low-level lackeys and instruct them to make small deposits, either on various branches or different days. This method is very difficult, time consuming, and after the computer algorithms installed in the bank system that could look for suspicious behavior in the deposits could raise a red flag to the government.

Criminals own shell companies in order to offer a product or service that can be easily be fudge and only working with cash as payment. The dirty money gets into the company through fake receipts and invoices, to make it look like legitimate and then deposited in the company’s account, making it ready to be used.

Legitimate business like strip-clubs or bars or casinos, can have the dirty money seeded into its revenue, and go into this business’s bank account. However, this method is easiest to be figured by the federal agents.

Other way of money laundering would be gambling. There are many games that can get a big return on the money you put into, so many criminals use this as a way to make the dirty money come into clean money, however, since it’s not 100% certain that you will win enough to turn your dirty money into clean money, the risk is higher.

The last case would be through banks. Offshore and overseas are mostly used to make an easy money legitimation due to its unrestricted bank laws and low anti-laundering procedures.

Knowing that this situation takes place in the USA early 60’s, when there were no digital records, (the first computer in a bank was in 1961 in London), and also knowing that most of the money laundering methods needed to go, in some way, through banks, Corleone’s family had an idea. Why not own a bank and, with that have a legitimate business, with the government awareness, protected by the many government secrecy laws, and turn it into their favor.

By owning their own bank, they could control not only their money deposit but also, others “families" deposit charging a fee for the service. In the money laundering process, the most difficult part is the first step, also known as the “placement”. Basically it consists by depositing the money into the bank, which is the riskiest stage of the process. At this point, large deposits are pretty conspicuous, and the banks are “required” to report to government high value transactions.

The second step consists on layering, which would be the action of transfer the money through different banks, accounts, using different names and countries, making deposits and withdrawals to continually vary the amount of money in the accounts. By controlling the bank, this step could easily be done by the Corleone family and can make the original money as hard as possible to be traced.

And the last stage would be the “integration”, which consists in make the money re-enters to the original account, appearing it to be from a legal transaction. At this point, the money can be used without getting caught.

Once the Corleone family hold control of all the documents regarding money deposits and withdraw, it would be impossible for the government keep track of the dirty money that is being laundered. Also, the banking activity is a good and legal way of making money, being able to control all the stages and operations related to money gives the family a big advantage ahead the government, and their competition.

How to open a bank?

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