In The Shepherds of Inequality, Dawn Pretorius declares money laundering “one of the world’s biggest and most vociferous sustainable industries.”
Defining dirty cash as profits from drug dealing, people trafficking, arms smuggling, illegal logging and mining operations, as well as tax evasion, insider trading, embezzlement, cybercrimes, identity theft and other “white-collar” shenanigans, Pretorius presents 60 months of “randomly” selected news stories from 50 “equally randomly chosen” countries as proof of
the perniciousness of this crime. Her examples run the gamut from no-brainer schemes – like using fake invoices and inflating prices – to mind-boggling scenarios, such as Iran’s alleged laundering of $20 billion in oil and gas revenues (despite U.S. sanctions) through a Turkish bank under the guise of gold and food commodity sales.
There’s also a fascinating chapter on cryptocurrency laundering (which includes the 2019 attack on Japan’s BITPoint exchange where investors lost $28 million), and a detailed discussion of the Financial Action Task Force (FATF), set up by the G7 in 1989. The author notes that FATF policies to combat money laundering, while not hindering criminals, have burdened banks with the task of alerting authorities to potential crime. Pretorius goes carefully through the evolving regulations and the corners which bankers cut to avoid them. (Readers might ironically note that savvy money launderers could learn a few tips here.)
Oddly, this insider-like analysis seems disproportionate to the broad, liberal thesis: “Inequality is almost always the result of laundered money,” which gets a more general treatment. It’s missing the granular detail offered elsewhere. Too, there are some editorial oversights: Material gets repeated nearly verbatim in different chapters, and while some chapters have been revised to include statistics from 2020 onward, others rely on older figures.
Despite the glitches and an overall imbalance in the author’s approach, however, this playbook offers valuable insights on “dirty” cash flow.
Also available in hardcover and ebook.