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The performative war on money laundering

Oliver Bullough — Wed, 08 Apr 2026 12:11:58 +0000

Dutch friends like to tell me that their nation’s primary characteristic is bluntness, and the Netherlands’ Court of Audit has done nothing to challenge the stereotype with its bracing assessment of the country’s and, by extension, the world’s failure in fighting money laundering. Published last month, after an extensive analysis of the country’s efforts to stop dirty money, the Court’s report concludes that the system is expensive, discriminatory, and — possibly — completely ineffective. No one has really checked on that last point, so they can’t be sure, which if anything makes it all worse.

The Netherlands hosts the largest port in Europe, and is therefore home to a vast smuggling industry — Dutch politicians not infrequently warn that it’s becoming a narco-state — which requires an equally vast money laundering industry to service its profits. The Court of Audit set out to check the government’s response to this challenge, concluding that it cost banks €1.6 billion a year. It’s a price tag that has increased by almost 17% between 2021 and 2024, during which time the number of reports the banks’ 13,000 compliance officers made more than doubled.

“We think it is important that these employees make a meaningful societal contribution to preventing and combatting money laundering. There is no evidence that shows that they do,” the report witheringly observes.

The court sent surveys out to “politically-exposed people” (PEP is a jargon term meaning anyone in a position of power, or a close relative or associate) asking about their experiences. One person’s 83-year-old mother was asked to explain the source of an inheritance she received after the PEP applied for a loan. It is an eye-opening section, revealing how process is prioritised over any kind of judgement about where the risk of money laundering genuinely lies, but the real shock is in the section about different religious groups, which shows how the transactions of immigrant-focussed churches and mosques are systematically checked more thoroughly than local Protestant or Catholic congregations.

“A bank told a mosque that it was not possible to collect so much money after a prayer meeting,” the report notes. “The mosque’s trustees said the bank could come and see for itself but the bank declined. Feeling powerless and unable to deposit the money with the bank, the trustees hid it in the mosque.”

Imagine if we had an ongoing health crisis. And imagine that the government had created an expensive, intrusive system to tackle it, which was generating an endlessly increasing amount of paperwork, employing thousands of people and actively discriminating against religious and ethnic minorities. Surely, someone would at least put in the hours to check if the system worked, whether it was making people healthier, and assess therefore whether all these bad side effects were justified?

With anti-money laundering policy, that is simply not happening. It’s based on faith rather than facts: we just need to do more of the same thing, and eventually we’ll get the results we want; if we don’t, we need to do the same thing even more. Interestingly, Texan judge Jeremy Kernodle — fresh from gutting the Corporate Transparency Act — has returned to the fight against anti-money laundering regulation. He has killed Geographic Targeting Orders, which were supposed to collect information around real estate transactions. “FinCEN’s explanations are vague, conclusory, and unpersuasive,” the court ruled. “The fact that some bad actors have conducted non-financed real estate transactions does not make such transactions categorically ‘suspicious.’”

I’m not saying I agree with Mr. Kernodle, because I don’t, but I don’t think pushback on anti-money laundering orthodoxy is necessarily a bad thing, since it obliges us to think more deeply about what actually works, rather than just going along with ineffective old policies. I hope people outside the Netherlands read the Court of Audit’s report and start wondering whether this approach isn’t long past time for a complete overhaul.

How do you solve a problem like crypto?

It’s quite unusual for there to be a divide in the UK’s anti-corruption community, which tends to agree on technocratic solutions to the problems around illicit finance, but one has emerged around the role of cryptocurrencies in political donations. Spotlight on Corruption doesn’t think the government’s moratorium on crypto donations goes far enough. There needs to be a ban, they argue, in primary legislation with additional safeguards. I agree.

The folks at RUSI, on the other hand, think a moratorium on crypto donations is a better idea since it would prime the country to take regulating cryptocurrencies more seriously, and prepare the way for them to be widespread. Take a look, judge for yourself, and let me know what you think. The difference may reflect deeper and unresolvable political differences in how countries should respond to globalisation, but it’s an interesting one to think about.

One thing I think we all agree on is the need for an urgent overhaul of all rules around electoral finance, while there’s still an honest system to approve them.

On that note, interesting news from Cambodia, which has extradited Li Xiong to China. Xiong, who is accused by governments worldwide of playing a key role in the now-collapsed Huione group, which was laundering money for crime syndicates on an industrial scale, with particular expertise in cryptocurrencies. Of course, the criminals have not stood still and have new markets up and running, but it is striking how quickly the extradition went ahead.

In contrast, the legal proceedings around the mammoth tax fraud exposed two decades ago by Sergei Magnitsky grind tortuously on, with the culprits still safe in Russia. They certainly enjoyed themselves in Europe for a while, however, as a court case in Paris shows. “The spending spree included: €668,517, ($771,703) at a Parisian art and antique gallery; €696,015 ($803,445) across two high-end French women’s fashion brands; €96,814 ($111,757) at a luxury jewellery store in Courchevel, an exclusive ski resort in the French Alps; and €127,182 ($146,813) for a Courchevel tour package.”

There are few things that reveal the moral bankruptcy of the regime in the Kremlin more than this case. It’s not enough that corrupt officials could kill a good man who exposed their $230 million theft from the Russian people, but the Russian state then shielded them while they splashed the loot on European luxury holidays, and continues to do so to this day.

Nothing on the same scale is happening in the United States of course, but still this analysis of how enforcement of the Foreign Corrupt Practices Act is being politicised is a bit grim: “The transformation of U.S. antibribery tools into economic weapons also threatens to undo the global system the United States helped establish to punish business corruption.”

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How dodgy digital finance destroys democracy

Oliver Bullough — Wed, 01 Apr 2026 22:00:00 +0000

It’s good to celebrate the wins, and I’m delighted the British government has decided to cap political donations from voters overseas at 100,000 pounds a year. It has long been grotesque that a wealthy citizen could move to a tax haven, stop paying towards the upkeep of his home country, and use the money he’d saved in taxes to buy influence in the politics of the country he’s left behind. I’m delighted that this has (largely) stopped.

This policy came from the independent Rycroft Review into foreign interference in UK politics, which other countries will be looking at closely as well. For believers in liberal democracy, which is on the retreat everywhere, this issue has only been getting more urgent thanks to Russian interference in Moldova, Romania and Hungary; as well as Chinese spying scandals; and the new U.S. strategy of supporting far right parties in Europe.

There’s a good summary of the Rycroft report here, but perhaps the most contentious recommendation is for a moratorium on any cryptocurrency donations to politicians until a time when the government feels regulations around digital assets are robust enough for them to be safe. Nigel Farage of the Reform Party popped up to say this was a retrograde step against innovation, but the real question is whether a moratorium is strong enough.

So much of the threat to democracy arises from the fact that wealthy people have been able to park their money wherever they like, to exploit multiple countries’ loopholes to evade taxes, scrutiny and investigations, and then use their money to project influence anywhere they wish. This is what doomed Russia’s chance of gaining democracy, and it’s now threatening many other places too.

I would love to see the governments of the remaining few liberal democracies be far more proactive in advocating the benefits of their systems, rather than staying in the perpetual defensive crouch that they seem to be in at the moment.

Money is global, but politics is local, so rich people can buy influence in ways that are not available to others, not just because they’re richer but because they can afford a whole world full of tricks to make their money go further. The answer to this problem is either to make politics more global, so it can stand up to the money, or to make money more local, so it is subject to countries’ political processes.

This is what the Rycroft review is doing with its cap on overseas donations, and it’s also why I think a complete ban on crypto donations would be better than just a moratorium.

The health of democracy is far too important to be subject to the whims of the unaccountable, nomadic class of the mega-rich, and nothing exemplifies their influence so much as cryptocurrencies, which are privatised money. A ban would be harder for a future government to overturn than a moratorium. And it would also send a signal that liberal democracy has its own currency, which is that it abides by rules set democratically and doesn’t need or want to outsource any aspect of that to the billionaires who dominate crypto.

A moratorium on crypto suggests a time when crypto may become acceptable, and thus a time when we won’t want money to have democratic oversight, and will be comfortable with obeying the whims of its owners. Financial innovation can be good, but we don’t need to innovate in how we pay politicians, that is too risky a game to play. So play with crypto by all means, but if you want to play with democracy, you need to abide by its rules. And democracies need to be more confident about asserting that principle.

Democracies also need to enforce their own laws properly, which means — as Rycroft suggests — hiring and training specialist police officers who can investigate attempts to slip dirty money into politics.

Crypto’s digital dodge

On that note, I’m glad it wasn’t me that had to write the new U.S. national money laundering risk assessment. Glad it wasn’t me who had to balance the obvious reality that cryptocurrencies are the most potent new tool for financial criminals since the invention of the shell company with the political fact that the White House really likes cryptocurrencies. “Uneven and often inadequate regulation and supervision across jurisdictions allows digital asset service providers and illicit actors to engage in regulatory arbitrage,” notes the report. But without pointing out that the United States itself is a major source of that particular problem.

Case in point, Tether, the El Salvador-headquartered company behind the dollar-pegged USDT stablecoin, has hired the Big Four accountancy firm KPMG to audit its books and confirm everything is as it should be. This is, the FT notes, all part of a plan to expand into the United States and to raise money there, though you would imagine that a first audit of a company with a murky regulatory history and claiming such a vast haul of assets could take a while.

In other crypto news: the UK has sanctioned Xinbi, an illicit online marketplace in Southeast Asia, and #8 Park, a compound where criminals can keep up to 20,000 trafficked people to engage in global scam operations. Xinbi moved something like $20 billion between 2021 and 2025, much of it stolen from vulnerable victims, to the benefit of Chinese gangsters. The transactions tend to be arranged on the messaging app Telegram. Vladimir Putin has been restricting access to Telegram for a while now, to build a government-issued surveillance app. I don’t agree with Putin’s reasons for shutting Telegram down, but I do think that the world would be better off without it. And without Tether.

It’s hard to imagine that Tether will care about British sanctions nor that they will make much of a dent in these activities, but I think we need to keep an eye on how the situation evolves when other countries take an interest too. Xinbi has already launched its own payment app, and has expanded to use other messaging apps, including Telegram, suggesting it is working to make itself immune from regulatory actions.

This replicates what we saw with Russian crypto operators moving to the rouble-denominated A7A5 in response to the freezing of notorious crypto exchange Garantex’s assets last year. USDT is still central to how value moves globally, but the new tokens create a secure bridge in and out of it, which cannot be touched by Western regulators or governments.

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Our corrupt world, run by oligarchs for oligarchs

Oliver Bullough — Wed, 25 Mar 2026 12:47:51 +0000

One difficulty in writing about corruption is explaining what it is. You’re either too specific — “it’s taking bribes”. Or too vague — “it’s being bad”. Another difficulty is obtaining the raw material to analyse: corrupt people don’t tend to speak openly about it, which means you’re left looking at corruption’s visible manifestations, which is like trying to understand a virus only from its spots.

So huge kudos to Earth League International for producing a detailed, specific and thoughtful report on how corruption facilitates wildlife crime globally, which is packed full of lessons for the study of corruption in general as well. Corruption is a system, everything is connected. It’s the water in which criminals swim, and it will drown the rest of us if we let it.

Earth League International embeds investigators in corrupt networks all over the world, and reveals how it is so much more than just the “abuse of entrusted power for private gain” and their report quotes multiple specific examples. The choice for an official standing in the way of a Transnational Criminal Organisation (TCO) is not between taking a bribe and being honest, it’s between taking a bribe and having a family member killed.

“Corruption tilts the playing field of justice by turning some officials or even agencies into additional arms of criminal networks, akin to painting a group of white chess pieces red and then commencing a match, giving the criminal side a decided advantage”, notes the report. And, it adds, “Transnational Criminal Organisations are savvy about which officials they approach, assessing weaknesses such as debt or family ties that may make them more vulnerable to financial offers or threats.”

It estimates the value of global wildlife-related crime at over $1 trillion annually, which is an astonishing amount of money, but an important point to take is that this is not a separate form of corruption. The same border officials that wave through illegal shipments of timber or shark fins also help with other forms of smuggling. The money that criminals funnel into politics undermines democracy in all ways. “Corruption is not the sole purview of less wealthy nations. It is everywhere. During investigations into illegal wildlife trafficking for (traditional Chinese medicine) in Europe, for example, Earth League International found enablers in San Marino, Italy, Belgium, and Poland,” notes the report.

There is something grimly ironic that so much of the despoliation that is making things worse for everyone is driven by the trade in “medicine” and thus a desire to make the world better. In reality, of course, pangolin scales and totoaba swim bladders are no more medicinal than my toenail clippings. Perhaps the ultimate expression of this is the demand for hallucinogenic toad venom, as detailed in this excellent article from a few years ago, which supposedly helps us all access the inner divine, but which is meanwhile wiping out the unfortunate toads that secrete it. “Most harvesters don’t have a consciousness about the sacredness of the species”, said a toad practitioner. “It’s just a hustle business.”

On a more geopolitical and less psychedelic level, this report on how Russia is repurposing its influence networks in Europe so as to maintain its fossil fuel exports show that other forms of corruption have huge environmental impact of their own. “The time for polite half-measures is over. Stronger enforcement, embargoes and tariffs on Russian fossil fuels to cripple exports, personal sanctions, and transparency rules are the only way to dismantle Russia’s covert influence architecture,” it concludes.

I’d add to that: we all need to build renewable energy sources like there’s a war on, because there is, and democracies urgently need to gain the freedom to act independently of autocracies’ control of fossil fuel supplies. You can’t act freely if someone’s hands are around your neck.

So, what’s the answer? As so often with financial crime, it’s possible to be overawed by the scale of the challenge. But the important thing is just to start. Here’s a manifesto from a coalition of British environmental groups, which gives some ideas. I particularly approve of this one: “government should introduce comprehensive protections and safeguards for whistleblowers, followed by financial incentives, to enable whistleblowers to disclose evidence of corruption and money laundering”.

Of course, corrupt officials are not just standing still while we agonise about how to stop them. I am particularly alarmed by the potential appeal of modern prediction markets for allowing politicians, military officers or anyone to profit from their privileged access to advance knowledge of government actions. Here’s a remarkable story about how people betting on the specific details of the Iran War sent death threats to a Times of Israel journalist whose reporting threatened to lose them a wager.

U.S. lawmakers have introduced a bill, the BETS OFF Act, for which acronym they deserve credit — to crack down on the markets that encourage this kind of behaviour, which was also observed in the hours leading up to the U.S. attack on Venezuela. “There’s no getting around the fact that any prediction market where somebody knows or controls the outcome of a bet is ripe for corruption,” said Senator Chris Murphy of Connecticut. “When events that involve good and evil, life and death become just another financial product, morality no longer matters and the soul of America is fundamentally corrupted.”

On that note, I see that someone is trying to juice the price of the $TRUMP memecoin by inviting its biggest holders to dinner at Mar-a-Lago, apparently with a speech by President Donald Trump (or whoever that is in the decidedly weird picture accompanying the announcement — Nigel Farage in a blond wig?), and an exclusive audience for the 29 biggest holders. The president, should he attend, will not, however, be accepting gifts, which is a weight off my mind. I had been worrying that this whole event was a bit dodgy.

The announcement of the event did boost the price of the $TRUMP tokens, as presumably did the announcement that Tether head Paolo Ardoino would be the headlining speaker, a remarkable turnaround for someone whose company was, just 18 months ago, having to vehemently deny it was the subject of a Department of Justice probe. Whether corruption will continue to be seriously investigated and punished, in a newly transactional world order, remains to be seen. The signs, though, are not promising.

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Iran’s cryptocurrency enablers

Oliver Bullough — Wed, 18 Mar 2026 13:55:00 +0000

There has never been a better time to be a billionaire. It’s official, Forbes says so, and it’s got the numbers to prove it. Top of the magazine’s annual list is, of course, Elon Musk who is only a Bernaud Arnault (worth about $147 billion) and some change away from being the world’s first trillionaire.

But to get the real headliner, we need to drop down to number 17 where we find Changpeng Zhao ($110 billion, since you ask), founder of cryptocurrency exchange Binance and business partner of the Trump family’s own crypto firm. Centibillionaires are old hat now but CZ is, as far as I can tell, the first centibillionaire on the Forbes list to have been pardoned by the U.S. president for egregious financial criminality. That feels like quite a big deal so congratulations to him.

CZ’s pardon last October was, according to the White House, because his 2023 plea deal and $4.3 billion fine for enabling money laundering on an industrial scale were the result of “an overly prosecuted case by the Biden administration” and part of a war on cryptocurrency.

Awkwardly for all concerned, Binance is now suing the Wall Street Journal after it reported that $1 billion had moved through the company to Iran-backed terror groups. And the Wall Street Journal has not only declined to spike the story, it has doubled down by reporting that the Justice Department is now investigating the firm’s actions. “The Wall Street Journal couldn’t determine whether the Justice Department is investigating Binance itself for potential misconduct, or solely the customers on its platform,” the WSJ said. But either way, considering the White House has committed to wiping out Iran’s support of terror groups and upended the global energy markets in its quest to do so, the news reports alleging that CZ’s company enabled those same groups would surely be embarrassing for all concerned, were any of them the kind of people capable of embarrassment.

After all, the fact that Iran is using crypto on a huge scale to evade the sanctions placed on its activities, and to support foreign proxies like Hezbollah, with the active connivance of some of the biggest companies in the crypto world, could only be a surprise to the most witlessly incurious of numbskulls. Or perhaps, I suppose, they are all making so much money from crypto that they don’t care who else might be.

While we’re on the subject of Trump, he’s at No. 640 on the list of billionaires as I write this, nearly tripling his wealth in just the last two years. Forbes has this very apropos explanation: “Donald Trump has presided over the most lucrative presidency in American history, adding billions to his net worth, largely by cashing in on crypto.”

But, I hear you ask, what about non-billionaires? How are the few billion of us whose net worth isn’t counted in the billions doing? Well, not great. And I’m beginning to feel a bit concerned about what this all means for democracy. “The widening gap between the rich and the rest is at the same time creating a political deficit that is highly dangerous and unsustainable,” said Oxfam International Executive Director Amitabh Behar back in January, and the situation has gotten worse since then.

The Bank of England’s animal stories

I spend a lot of time at the moment talking in public about money laundering because of my new book. Top of my list for policy suggestions for tackling financial crime, if anyone were to ask, is that governments should stop printing large denomination bills: $100 bills, €200 notes or — worst of all — Switzerland’s colossal 1,000-france banknote are little used by ordinary people, but extremely helpful for criminals looking to transport large amounts of wealth in a small space.

So, in one way it was great that Britain was temporarily convulsed by controversy around banknotes last week. It’s high time we talked more about them. Could this spell the end of the UK’s own big bill: the £50, of which the Bank of England issued almost an extra 30 million last year, even though pretty much the only people that ever use them are criminals and tax dodgers? Would Britain finally get serious about ending the epidemic of financial crime?

No, of course not, the controversy was entirely about the Bank of England’s decision to replace the pictures of people on its next series of banknotes with pictures of animals. For some reason, badgers were mentioned. Also otters. “It says all you need to know about the lack of seriousness of the Bank,” said former business secretary Sir Jacob Rees-Mogg, without any apparent irony, considering his own spectacular lack of seriousness in agreeing to comment on this absurdly unserious confection.

A sledgehammer that cracks nuts

While researching the anti-money laundering system that has grown over the last few decades, I have come to find it strange that there isn’t more public disquiet over the powers that governments have awarded themselves to check ordinary people’s transactions. When there is concern, it tends to come from crypto/libertarian bores (the kind of people who talk about ‘Operation Choke Point 2.0’), so perhaps no one else wants to be associated with it. But I think the situation would be a bit healthier if more of us engaged with what is being done to us in ways that we can get.

I obviously think that tackling money laundering is of huge importance, but I am coming round to the view that more public pushback over exactly how that is being done would be good. It would force policymakers to justify what they’re doing, and therefore come up with some techniques that actually work, instead of the ineffective but intrusive mess we have at the moment.

To cut a long story short, I found this contribution from the Dutch non-profit organisation ‘Privacy First’ to be interesting. “Instead of managing risk, banks seek to eliminate it by withdrawing altogether from customers or sectors perceived as problematic. The burden of compliance and over-enforcement often falls not on criminals, but on already marginalised communities with limited access to remedies,” it says.

I agree with that, and I agree also with its argument that beneficial ownership transparency should not be absolute. Were there to be opt-outs from ownership registries for vulnerable people, there would be less scope for rich crooks to argue that shell company transparency is a violation of their human rights.

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Why Kleptocrats go to war without a care in the world

Oliver Bullough — Wed, 11 Mar 2026 13:22:25 +0000

Kleptocracy is a global system, which allows crooks, thieves, oligarchs, tycoons, and the like to enjoy their wealth while evading any responsibility to the society where they obtained that wealth. It infects different countries to different extents, and I’ve been very impressed by the Bloomberg investigations into how kleptocratic the Iranian elite has become. If you’d like a shortcut to those investigations, this new video is worth watching. Obviously, Iran’s regime has been vicious and aggressive from the start, but I do think there is a new kind of vicious aggression that develops when a country’s elite becomes kleptocratic, and thus is — in essence — colonising its own country.

If it is extracting wealth, hiding that wealth offshore and thus secure in its future, it is able to take risks and make decisions without concerning itself about their effect on ordinary people. “While ordinary Iranians contend with a collapsing currency, rising prices, fuel shortages and now war, elites like (Hossein) Shamkhani have translated political lineage into global capital — buying property abroad, securing foreign passports and moving freely through systems that everyday citizens cannot enter,” Bloomberg notes.

Much of the elite’s ability to enrich itself has come from its evasion of Western sanctions, which Iranians have had decades of practice in learning how to dodge. And the role of cryptocurrencies in enabling Iran’s kleptocrats is clearly significant, as demonstrated by this report from Chainalysis. But of course the backbone of the corruption has been the elite’s control over trade, and thus its ability to move value to safe havens like Dubai (that’s not looking as safe as it did of course but, don’t worry, the money can easily find a new home), which gives it the security to fire missiles without worrying too much about retaliation.

In this though, I’m not sure Iran is particularly unusual. A lot of the governments involved in the crisis in the Middle East are a bit like those F. Scott Fitzgerald characters who “smashed up things and creatures and then retreated back into their money or their vast carelessness”.

Israel’s Benjamin Netanyahu has been dancing on the edge of a corruption trial for the best part of a decade, ever since he was indicted in 2019 for, among other things, accepting “hundreds of thousands of pounds in luxury gifts from billionaire friends”. Donald Trump’s family has assets worth more than double what they were just two and a half years ago. The earnings from crypto alone are enough to guarantee the most comfortable of futures. These two are very definitely careless people, as is everyone around them.

If this ill-planned military adventure ends badly, then the elites of none of the combatant countries will end up suffering in the way that ordinary Iranians, Israelis or Americans will. This sense of impunity infects much of the discussion of the war: how, for example, could someone who feels any connection to other people be exulting in their death in the way that U.S. Secretary of War Pete Hegseth does? In this bloodthirstiness, as in so many other aspects of kleptocracy of course, Russia led the way, but the rest of the world is catching up and I don’t think we’re ready for what that will look like.

An important aspect of this, again long visible in Russia with its dreadful public services and military failure in Ukraine, is that corruption does not just enrich elites, it also degrades state capabilities. “Corruption at the top always rolls downhill. Once it becomes open and acknowledged, it leads to corrupt and slovenly acts throughout a system,” as Phillips Payson O’Brien argues, in a piece which builds on another article in which he lays out how the Russian model might be worth applying to much of what’s happening in the United States.

This of course adds fresh weight, not that it’s needed, to the urgency of shoring up defences not just against foreign interference in the democratic processes of those countries that still have them, but to getting big money out too. It’s great that a U.S. politician has, for the first time, taken the Political Integrity Pledge and won (though admittedly only a primary), but just to get to the stage of standing in the general election, he’s had to raise more than $20 million. Too much of that and pretty soon you’re talking about real money.

This week at Tether

Talking about real money, the latest episode of Tether watch is a weird one: our favourite crypto concern has just invested $50 million in a smart mattress company. Now admittedly, that isn’t even two days’ worth of last year’s profits, so it’s not exactly a big deal for CEO Paolo Ardoino but it’s still sufficiently sinister to be worthy of mention.

I find it disturbing enough that tech companies are harvesting our browsing history to make money from, but it’s a whole other level to have Tether — Tether!?! — monitoring what people get up to in bed. It’s all, apparently, about personal sovereignty, which is to say you should stop trusting big companies with your data and instead trust it to Tether, including with what’s happening in your head: “Paolo's $200 million acquisition of a majority stake in brain-computer interface company Blackrock Neurotech may not be because he is optimistic about the size of the brain-computer interface market, but because he does not want the brain-computer interface to be controlled by others”.

Historians are going to be so confused by this; assuming of course that there will still be historians, which may be an over-optimistic assumption about a future with brain-computer interfaces.

The need to know your enemy

I’ve been talking to quite a lot of people about money laundering of late, and one of the enduring problems is the lack of reliable ways to gauge the scale of the problem. We’ve been saying it’s between 2% to 5% of the world economy since the late 1990s, but beyond repeating that age-hallowed guesstimate, how do you measure it?

Often we turn to other measures, such as how many suspicious activity reports get filed, or how many fines get imposed. So, on that note, is it good or bad that the UK’s Financial Conduct Authority imposed fines last year of just £124 million, a decline of 78% from half a decade earlier? Maybe this means there’s 78% less crime? Or maybe it means that the FCA has stopped investigating 78% of crime? Or maybe 2021 was just a really big year for fines (which it was)? Or maybe something else happened?

The answer to this is that we should properly investigate money laundering not just criminally but also academically, looking at gaps in statistics and devising new methods of measuring how large the criminal economy is, rather than rely on proxies for it. That would not only help us identify what to target, but also help us see what techniques are working as criminal wealth rises and falls. As it stands, it feels like we’re waging a war without a clear idea of where the enemy is, and what the final goal might be, and there’s quite enough of that going on elsewhere at the moment.

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Can a Task Force set up to punish the little guy, take on Trump?

Oliver Bullough — Wed, 04 Mar 2026 13:55:00 +0000

This is going to be a big year for the Financial Action Task Force, the world’s standard-setter on money laundering regulations, under its new president Giles Thomson. Quite apart from the standard folderol of plenary meetings, reports and publications, it is due to send a mission to assess the United States.

This whole process will not be quick, and there will be the usual abundant opportunity for acronyms, circumlocution and horse-trading. But eventually the hooves are going to have to hit the road. There is simply no way of hiding the fact that, under Donald Trump, the United States has broken its promise to bring greater transparency to shell companies; nor that it has scaled back prosecution of financial crimes, pardoned convicted financial criminals, and unleashed a crypto frenzy.

Throughout its history the FATF, set up by the G7, has been able and willing to overlook transgressions from big countries that it wouldn’t tolerate from smaller ones. It punished the remote island states of Niue and the Marshall Islands in its first ever blacklist for their lack of transparency around shell companies, for example, while merrily tolerating the fact that not even the Federal Bureau of Investigation could figure out who owned a corporation in Nevada. Nauru got punished for moving dirty Russian wealth while the UK and Switzerland didn’t.

The FATF’s structure, which ensures it is dominated by large economies, is a classic example of how, if you’re not at the table, you’re on the menu. But, in the past, those large economies have at least pretended to go along with its recommendations. They’ve made promises, passed legislation, convened working groups, said the right things: all of which has given everyone the diplomatic cover they need to keep each other off the naughty step.

Trump’s not doing any of that, and it’s hard to believe that he’s going to change that habit. If the FATF criticizes his administration, I think we can safely assume Trump won’t take that well, and could — if past behavior is any guide — pull the United States out. But if the FATF doesn’t criticize what he’s been up to, it will lose all credibility.

Speaking for myself, I think the FATF’s conception, structure and techniques are all flawed, perhaps irreparably, and that it has been part of the problem, rather than part of the solution, for most if not all of its 37-year history. Perhaps, therefore, Giles Thomson should get ahead of the looming fiasco by declaring a complete overhaul of the whole organization, re-examining its recommendations, its memberships, its strategy, and more.

What are the chances of that happening? Well, here’s some news from the Pacific: “Papua New Guinea one step away from being blacklisted, global money laundering watchdog warns”. Is Papua New Guinea the problem? No. Do we get anywhere by pretending that it is? Also no. Will the FATF carry on regardless anyway? I would love to be surprised by the answer to that question.

The need to clean house

I’m a big fan of this video from Transparency International’s UK chapter, which lays out the inglorious history of corruption in British politics, and urges the government to be more ambitious in its new piece of legislation. TI has pointed out three areas where it thinks the government should go further, and I agree with all of them, but I would also like to see a complete ban on crypto donations, which would help prevent compliance departments being overwhelmed by automated efforts to circumvent donation limits.

I would also urge you to read this comment piece from RUSI about the threat to democracy posed by big funders from the American right, which has significance far beyond British politics. The world’s remaining democracies have been slow to recognize how radically the values of many U.S. billionaires have diverged from what we traditionally associate with conservatism, and to shore up their defences against them. “The task now is to strengthen our democratic guardrails — calmly, transparently and proportionately — before those boundaries are redrawn by others,” the writers Neil Barnett and Eliza Lockhart conclude.

Transparency International’s Russian chapter has been in exile since 2022 for obvious reasons (last year, for example, it had to issue a statement to argue that “fighting corruption is not terrorism”) but it has continued to conduct really valuable investigations into how illicit wealth flows in and out of its home country, including a recent one detailing the use of shell companies in the UK’s tax havens to trade with Russia, and identifying $8 billion worth of transactions.

The worst offender as a source of opaque companies was the British Virgin Islands, though Bermuda was also a problem, moving sanctioned products — including lead and zinc — as well as oil and other fossil fuels, a surprisingly large number of yachts, and a jet that ended up belonging to Chechen strongman Ramzan Kadyrov (whose ill-health is, apparently, once more the subject of speculation, poor chap).

“For many years now, we have observed a dysfunctional equilibrium in which illicit financial flows, tax evasion, sanctions circumvention, and other forms of misconduct are channelled through firms and intermediaries registered in unaccountable jurisdictions,” TI-Russia notes. Fortunately, however, the British government is hosting an illicit finance summit this June and so has the perfect opportunity to set an example by making sure this kind of thing stops happening on the territory it’s responsible for if nowhere else.

Here’s an interesting story from the Netherlands, where luxury firm Louis Vuitton was fined half a million euros for failing to identify customers spending large amounts of cash. This case was part of an investigation into the Chinese money laundering technique known as ‘daigou’, in which value is transferred internationally not via the financial system but by buying expensive objects and then reselling them in China. High-end fashion is often used in the system, and it will be intriguing to see if other countries follow the Dutch lead and investigate unusual cash purchases.

And here’s a piece on our favorite crypto company Tether, which is apparently valued by market participants at between $200 and $350 billion. That is less than estimates made in the summer, but still an awful lot of money. Fun fact: finance firm Cantor Fitzgerald has a five percent stake in Tether, which is thus worth $10 to $17.5 billion, via a convertible bond. Another fun fact: Cantor Fitzgerald is owned by Commerce Secretary Howard Lutnick’s children.

Interesting question, would the prospect of your family earning a windfall of that size affect how stringently you would approach the regulation of a financial institution accused of involvement in industrial-scale money laundering? Lutnick, who led Cantor Fitzgerald for over 30 years, is of course not the kind of man who would let petty cash cloud his judgement, so this question is of academic interest only, but still, worth thinking about.

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Why we must make elections cheap again

Oliver Bullough — Wed, 25 Feb 2026 13:55:00 +0000

I like writing about the huge consequences of tiny details: a compromise made at a G7 meeting in 1989 by people who didn’t know what they were doing that now defines all anti-money laundering work; an opportunist deal among London bankers in the mid-1950s which created the globalized financial system; things like that (read my books if you want more.)

Few tiny details are more consequential than the rules around democratic processes, and particularly those that define who pays for them: just look at the effects of the U.S. Supreme Court’s decision in a dull-sounding case in 2010. A lot of other democracies are looking at the U.S. right now and thinking they’d like to avoid replicating this experiment with endless money, which is one reason why the UK has a new ‘Representation of the People Bill’.

As it stands, it looks like a big missed opportunity.

Much of the requirement for the tighter rules proposed in the bill is the need to tackle foreign interference, a concern stoked by suggestions that the Kremlin helped secure victory for both Brexit and Donald Trump in 2016. Although I can see why we don’t want Vladimir Putin near our political systems, I’ve always thought these concerns missed the point: home-grown oligarchs dislike democracy as much as Russian ones do and, since they are more numerous, richer and far better-connected, we should worry about them more.

So, it is a great shame that the UK’s new bill hasn’t imposed a cap on political donations to prevent the kind of funding arms race that has infected the United States, and which is gearing up in the UK too, or stripped away a lot of the unnecessary complexity in the existing regulations that create the kind of loopholes exploited in the Brexit referendum. Most importantly, it has failed to address the growing threat of cryptocurrencies and impose the same kind of ban on crypto donations that Ireland has.

A democracy is sovereign, and a crucial defence of that sovereignty is ensuring only actual voters fund its operations. British law enforcement agencies acknowledge that they already don’t have the resources they need to keep up with what bad actors are doing with crypto, so why would politicians take the risk of allowing crooks to buy influence by making it easier for them to hide what they’re doing?

“If you put an element of crypto in what is already a complicated and sometimes lengthy trail to hide the true source of the funds, you are just adding another layer of complexity. Anything we can do to take away that friction is good,” said Rachael Herbert, director of the National Economic Crime Centre, to a parliamentary committee.

It is not too late to close this gap in the bill, and to prevent it from becoming one of those little details with huge consequences. Blocking cryptocurrencies will not solve the problem caused by oligarchs’ assault on democracy, but at least it would help not make it worse, and it is always easier to mend things before they break.

On that note, credit to Daniel Lobo-Lewis for trying to use some of the mechanisms of the unregulated U.S. political funding system for a good cause (“Give us money to get money out of politics. It makes sense if you don't think about it too hard”) by creating the political integrity project. He’s built a tracker so you can see how much cash different candidates have raised, and which of them have pledged to try to get money out of politics, and it’s a lot of fun to play around with.

Here’s what it looks like when there is unfettered money in politics. Lobbyists for crypto firms are planning to spend $263 million on the midterm elections this year. That is not only more than the entire oil and gas industry spent in 2024, but more than double the total spent by all parties in the UK’s last general election. This is not healthy.

I’ve largely avoided writing about the Jeffrey Epstein revelations, because I don’t feel like I have anything to add to what everyone else has already said, but they do spectacularly demonstrate the size of the threat posed to girls in particular and society in general when the political, cultural, financial and economic elites of a country become entangled, give each other money, do each other favours, and generally take over the world.

Preventing this kind of collusion is why it’s important to keep big money out of politics, so at least there is a source of power in society that’s independent of the oligarchs.

Crooks thriving in chaos

While on the subject of human trafficking, Chainalysis has produced this alarming report on how crypto helped traffickers move their profits last year, including from child sexual abuse material (CSAM), with a staggering 85% increase in them dong so over 2024.

“CSAM networks have evolved to subscription-based models and show increasing overlap with sadistic online extremism (SOE) communities, while strategic use of U.S.-based infrastructure suggests sophisticated operational planning,” the report notes.

The report gives more evidence for how Chinese money laundering networks based in Southeast Asia are using cryptocurrencies to expand their influence globally (as they also are in fraud), with business deals coordinated via the encrypted messaging app Telegram, and laundered via sophisticated techniques beyond the reach of law enforcement even at the best of times.

And this is not the best of times, what with the United States having abdicated its traditional role as the only country serious about investigating, prosecuting and convicting financial criminals.

“Enforcement is now solely in Washington’s hands, allowing politically driven cases to proceed or be stifled,” noted John Lothian in this scathing commentary contextualised by the FT. “Given the pardons issued by President Trump, there has never been a better time to be a crook. This chaotic formula for enforcement is a disaster or a cluster of disasters waiting to happen, given the explosive growth in retail futures trading, prediction markets, and legitimized crypto trading… ‘God help us’ is the last defence.”

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The war against corruption: Why corruption is winning

Oliver Bullough — Wed, 18 Feb 2026 13:55:00 +0000

Transparency International has published its annual Corruption Perceptions Index and, for once, I think this rather tiresome survey of how likely various countries’ public officials are to be crooked has something important to tell us. Generally speaking, the CPI spends its time informing us that poor countries have worse governance than rich countries, which is not a very useful insight. What it fails to do is tell us that a significant reason for this fact is that rich countries make it very easy for poor countries’ rulers to steal from their subjects, obscure the theft, and spend the proceeds on property in Mayfair, Miami or St Moritz.

But I do think it’s important that, this year, influential Western countries are sliding down the rankings: the United States has dropped to its lowest-ever score and last year’s crackdown on independent media and judges haven’t even been reflected in that score yet. “We’re seeing a concerning picture of long-term decline in leadership to tackle corruption,” noted TI. “Even established democracies, like the U.S., UK and New Zealand, are experiencing a drop in performance. The absence of bold leadership is leading to weaker standards and enforcement, lowering ambition on anti-corruption efforts around the world.”

Hopefully, TI’s index and its grave conclusions will help galvanize opposition to the pro-oligarch policies that are infesting the world, and help to stave off oligarchical takeover in places that are still doing okay. That is, I suppose, valuable.

Still, I haven’t changed my opinion that the Corruption Perceptions Index should be abolished. It is absurd that Hong Kong is ranked as the 12th cleanest jurisdiction in the world, while China — the country it exists to loot — is 76th. Just as ridiculous is the position of the United Arab Emirates at 21st in the list, considering its growing role as a lynchpin of global kleptocracy, including from Russia (ranked a lowly 157).

The United Kingdom may have fallen to 20th but that is still far too high for a country that, by its own admission, launders a hundred billion pounds a year. That’s equivalent to the entire GDP of Kenya, which is down at 130 in the list.

You simply cannot understand corruption on a country-by-country basis because kleptocracy is a globalized phenomenon, and anything that suggests you can — particularly something so crude as a league table — is too misleading to be useful.

Talking about multijurisdictional wizardry, check out this report from the FACT coalition on how U.S. companies structure their affairs. Thanks to new accounting rules, it is possible to see how and where U.S. corporations pay tax. Some of the results are pretty remarkable: Boeing pays more tax in Germany than in the United States; Tesla pays only $28 million to the U.S. Treasury, fully 27 (!) times less tax than it pays in China.

Of course, a large chunk of these companies’ profits barely get taxed at all, but instead are routed to countries that treat them generously, of which Ireland, the Netherlands, Bermuda and Singapore are particular standouts.

The fact that this information is disclosed is good, because it allows ordinary citizens to see how big companies win special treatment, and hopefully thus increases public pressure for fair taxation. I would not therefore be at all surprised if some skilled and energetic lobbyists are right now working very hard to make sure the disclosures end as soon as possible.

Of course, you do not need to leave the United States to obtain complicated corporate structures, as shown in this recent piece from Bloomberg, about how the Russian oligarch, party-goer and billionaire Suleiman Kerimov opened a Delaware-based trust to, er, manage assets held by a Liechtenstein-based foundation but originating from his business empire in Russia, where he remains a member of the upper house of parliament. But then Kerimov was sanctioned in 2018 for what the first Trump administration called “worldwide malign activity”. He was specifically accused of bringing millions of euros into France in suitcases, using it to purchase villas, and evading taxes on them (there’s no school like the old school).

Despite the sanctions, Kerimov continued to benefit from the trust, according to Bloomberg. But the Treasury Department has gradually been catching up with everyone involved: a $216 million fine for a venture capital firm in June; an $11.5 million settlement from a private equity firm in December; and a $1.1 million fine for an attorney around the same time.

I’d like to say that hopefully this will focus minds on the majesty of sanctions and the importance of complying with them. And there are certainly some — such as the excellent folks of Collectif Sassoufit who are campaigning against corruption in Congo — who want the United States to designate more people, since justice can’t be obtained at home. I, however, think it’s time to have a serious reconsideration of Western over-reliance on sanctions, particularly in the light of the way that the United States is using them now.

If you want an example of what I mean, consider the case of Kimberly Prost, an impeccably-credentialled Canadian judge at the International Criminal Court who was sanctioned because the White House didn’t like the way she’d authorised investigations into U.S. military personnel in Afghanistan (other ICC staff were also sanctioned for investigating other alleged American and Israeli transgressions), and who suffers repeated indignities as a result. “I have an e-reader,” she said. “it’s not even an American product, but for some reason, I assume tied to the payment, I’d purchase books, I’d start to read them and then they’d disappear.” You just, she admitted, “sort of end up using cash a lot.”

Frivolous sanctions like this are just driving countries to find ways around the restrictions (it’s notable that banks in Canada, the UK, and the Netherlands are happy to keep serving her, and it seems unlikely they’d be doing that without permission from their respective governments) and, in decades to come when genuine criminals can bank with impunity, future generations will despair at how U.S. governments wasted the powerful weapon that was their dominance of the global financial system.

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Why the law lets financial criminals off the hook

Oliver Bullough — Wed, 11 Feb 2026 13:55:00 +0000

There’s a story I often tell when I talk about my new book: a couple of years ago, an adviser to a senior politician here in the UK asked me for some suggestions for policy proposals for tackling financial crime. I told him I’d like more resources for law enforcement agencies. His reply: “that’s not going to get us many headlines, is it?”

This story is intended to illustrate how one of the reasons for the world’s failure to stop money laundering is that politicians are addicted to the sugar rush of new policy announcements, but shun the hard work of enforcing old ones. But it’s indicative of a problem with journalism too. Journalists like to talk about shiny new things — crypto! AI! — and ignore the old ones that we’ve already reported on.

This is the lesson I draw from the horror of the Jeffrey Epstein revelations, with the rich, powerful men dividing up the world between themselves. Crooks and thieves may invent new tools, but they’re always designed to do the same old job: steal. A world-weary shrug — “politicians on the take? How is that a story? Bring me something new” — just lets them off the hook.

So in a small gesture towards being the change I want to see in the world, this week’s newsletter is about massive problems that have been going on for so long that everyone’s kind of forgotten about them, but which we should still be trying to solve because they’re still massive problems.

Global Financial Integrity, a research and advocacy organisation in Washington DC, has been arguing for almost two decades that we need to spend as much time looking at how illicit value flows through the trade system as we do looking at the financial system. In simple terms, by lying on the documentation that accompanies trade shipments, exporters can suck wealth out of poorer countries and — according to GFI’s analysis — have been doing so on a vast scale for decades.

In its latest analysis of trade flows out of Sub-Saharan African nations, GFI has identified “a renewed intensification of trade misinvoicing risks across the region”, with an average of $112.97 billion in value disappearing each year over the past decade, and at an accelerating rate. This total significantly exceeds that of the countries’ new debt over the same period, meaning that they should be seen effectively as net creditors to the world, rather than as net debtors.

“Illicit outflows on the scale observed in Africa have dire consequences for development. Every dollar siphoned out of African economies is a dollar not taxed or invested at home,” GFI concludes.

This phenomenon is often called ‘Trade-Based Money Laundering’, and is central to how illicit finance works, including the business model of the giant new ‘Chinese Money Laundering Networks’, but policy proposals for how to tackle it are sorely lacking.

There has been, however, no shortage of suggestions for how to stop criminals being able to hide their identities behind shell companies when moving illicit funds. Corporate transparency has been pushed by the Financial Action Task Force since its earliest days.

Efforts to achieve that goal have foundered in the European Union and the United States, but the UK has been a bright spot, with its notoriously filthy corporate registry of a decade ago adopting new rules to clean itself up. It would be nice to think this would mean we’d no longer see insiders from ex-Soviet republics using UK-registered companies to arrange questionable deals, but here’s the Organised Crime and Reporting Project to set us right.

“Two UK companies with no prior record in the mining industry have won tens of millions of dollars in Uzbek state procurement contracts,” the report states. “One was owned, on paper, by a septuagenarian British bookkeeper with no evident ties to Central Asia. The other, by a UK corporate services provider that for years managed corporate structures that shielded their true ownership from public view.”

The real meat in this sandwich, however, is how — after the journalists asked questions about the companies — their owners were able to seamlessly change the inconsistent pieces of information in the registry, much of it backdated, despite the supposedly more stringent new requirements.

I know this may all seem a bit academic because, thanks to the gutting of the U.S. Corporate Transparency Act, it’s easier, cheaper and murkier to use an American shell company these days anyway, but it’s important to remember that the battle hasn’t yet been won anywhere.

And one of the reasons it hasn’t been won is incompetence by underfunded and under-supported regulatory bodies. This was once again on display in the disastrous attempt to punish a British lawyer for allegedly persecuting a whistleblower who helped to expose the workings of the vast OneCoin scam.

Everything about the case has been a fiasco: the fact that the fraud happened in the first place; the fact that the fraudster was able to retain a British lawyer; the fact that the regulatory action took eight years to happen; the fact the tribunal threw the case out; and now the fact the regulator is on the hook for everyone’s costs. I would say this has achieved nothing, but it’s worse than that: now the regulators have a reason to be even more timid than they already are.

It means that theft keeps happening and even when efforts are made to find the stolen wealth and punish those responsible, the damage has already been done. For instance, it’s good that UK prosecutors are launching a case against Nigeria’s notorious former oil minister, but how much better would it have been if theft hadn’t been so easy in the first case?

Of course that’s not to say that we shouldn’t talk about shiny new problems too, so here’s this week’s instalment of Tether watch. Fair warning — it is unusually gross, even by the low standards of this newsletter’s most regularly-appearing crypto company.

“Private Telegram groups for the sharing of secretly taken footage of women and girls take payment via the popular Chinese digital payments systems Alipay and WeChat Pay, as well as the cryptocurrency Tether.” One group “offers access to more than 40,000 videos of secretly taken footage from hotels, homes and public toilets for a $20 ‘V.I.P.’ membership”.

Tether denies any wrongdoing, and says that it cooperates with dozens of law enforcement agencies worldwide. It’s clearly doing something right anyway, since it claims to have made more than $10 billion in profits last year, having issued $50 billion worth of new crypto currency, and has launched a separate stablecoin — USAT, as opposed its normal USDT — for the American market.

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How Stablecoins make it easy to sidestep sanctions

Oliver Bullough — Wed, 04 Feb 2026 14:33:34 +0000

In recent years, Western countries have been very reliant on sanctions as a tool of foreign policy and I think it’s a mistake. It’s not too much of an exaggeration to say that sanctions are law enforcement by press release. They punish people without a trial, with little if any chance of appeal, while outsourcing all the hard work to private companies.

There’s a small insight into what this looks like in practice from a fine imposed on Britain’s Bank of Scotland last week over its failure to notice that a new customer had been sanctioned for his role in Russian-occupied Crimea. He had registered with a slightly-different spelling of his name — “a changed character and an additional character in the forename, a missing middle name and a changed character in the surname” — which briefly out-foxed the bank’s compliance systems.

I’ve written about this particular gentleman’s adventures in transliteration before. Having opened the account, the bank failed to notice that although he had been removed from the European Union’s sanctions list, he had not been removed from the equivalent UK list, meaning that for 18 days he had access to financial services he should not have had, until various automatic systems and manual checks caught up with him.

In the circumstances, the Bank of Scotland is probably happy to pay its 160,000-pound fine, which also serves to remind financial institutions to invest in all possible compliance-related software, to employ more people who can check and double-check everyone and everything, just in case the next fine is bigger and comes with sharper teeth.

The upshot is that sanctions just got more expensive, more laborious and more complicated. But have they got any more effective? For that, we need to remember what they were supposed to achieve. “Our actions, taken in coordination with partners and allies, will degrade Russia’s ability to project power and threaten the peace and stability of Europe,” said then-Treasury Secretary Janet Yellen in February 2022, when announcing a first tranche of sanctions, to which many others have since been added, in many countries.

Now, I’m not saying this hasn’t been completely without effect – Russian oil revenues dropped sharply last year, for example — but it’s important to remember she was talking almost exactly four years ago, which means Ukraine has been resisting Vladimir Putin’s Russia for longer than either the USSR or the USA spent fighting Adolf Hitler’s Germany. Whatever the argument about the effectiveness or otherwise of sanctions in eventually stopping Putin’s war machine, you have to agree that they haven’t worked very quickly.

And this creates a problem. As with incompletely applied restrictions on money laundering, sanctions imposed without other enforcement mechanisms fail to defeat the people they’re aiming at, while incentivising them to learn how to circumvent restraints.

So what’s the solution? Should we just give up on sanctions altogether and create a financial free-for-all equivalent of this year’s Enhanced Games, when cheating will be legalised so a rich man “with a mission to build superhumanity” can pay poorer people to take performance-enhancing drugs and see what happens?

You might think that’s a rhetorical question to which the answer is “OBVIOUSLY NOT!!!”, but that’s kind of what’s already happened. In April, Donald Trump’s Department of Justice decided to step back from the Biden administration’s policy of trying to make crypto companies obey the law. “The Department will no longer target virtual currency exchanges, mixing and tumbling services, and offline wallets for the acts of their end users,” the deputy attorney general said in a memorandum titled ‘ending regulation by prosecution’.

It is hard to over-stress quite how wildly this Enhanced Games-esque policy diverges from the approach taken towards money laundering since 1970, when the authors of the Bank Secrecy Act specifically stated that banks were responsible for the criminal acts of their clients, a financial anti-doping policy subsequently adopted by the whole world.

What’s been the result of the White House’s unilateral surrender? Obviously, it’s too early to see the full effects, but the general outlines of a catastrophe are already visible.

“Illicit cryptocurrency addresses received at least $154 billion in 2025. This represents a 162% increase year-over-year, primarily driven by a dramatic 694% increase in the value received by sanctioned entities,” said Chainalysis, the respected crypto investigations organisation. “We must caveat that this figure represents a lower-bound estimate based on illicit addresses we’ve identified to date.”

That means sanctioned entities moved almost seven times more value via crypto in 2025 than in 2024! That whole approach of using Western dominance of the financial system to restrain geopolitical adversaries is gone, and who knows what, if anything, will replace it.

Stablecoins now account for 84% of all illicit volume, according to Chainalysis, which also separated out the booming business being done by Chinese money laundering networks, which are seizing an ever-greater share of the market with their “industrial-scale processing capacity, operational resilience, and technical sophistication”.

US officials love stablecoins, since their issuers tend to buy Treasury bills to guarantee their assets’ value, which helps provide some extra support for the long-term U.S. policy of piling debt onto future generations rather than raising taxes on presidents’ wealthy friends. But if the approach now involves handing a sanctions-evasion opportunity to mobbed-up Chinese kleptocrats, Russians and others, then it is even more disastrously short-termist than it already appears.

Stablecoin giant Tether, by the way, may be buying a lot of U.S. government debt but is also hedging its bets and investing heavily in gold, of which it buys two tonnes a week. Of course, it keeps its stash in nuclear bunkers in Switzerland. Because why wouldn’t the people behind Tether want to resemble Bond villains even more than they do already? Next month perhaps they’ll announce a new corporate headquarters inside a Japanese volcano, with its own shark pool, stealth catamaran, and space station.

And that’s before we get to the effect of artificial intelligence on how criminals can complicate and obfuscate crypto laundering schemes, something I’ve been hearing about for a while. “The intersection of AI and cryptocurrency reflects the operational reality of contemporary jihadism,” notes one rather terrifying report. “Current counter-terrorism finance systems” it warns, “are structurally misaligned with how terrorists use crypto today.” I see no sign that any government minister anywhere is close to being ready for any of this, or to be honest, even aware that it’s happening.

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The new boss? Not the same as the old boss

Oliver Bullough — Wed, 28 Jan 2026 13:55:00 +0000

In the good old days, all a money launderer had to do was take a bag full of cash into a bank, hand it over, and walk out with a cashier’s cheque. Annoying rules and regulations have long made that kind of thing difficult/laborious, but fortunately for launderers they now have crypto-for-cash brokers who do the same job.

We’ve seen the same pattern all over the world — a criminal hands cash to a middleman, and receives cryptocurrency in exchange — but rarely has it been so well explained as in this affidavit attached to the indictment of Jorge Figueira, a 59-year-old Venezuelan charged this month with laundering more than a billion dollars.

In some ways, this was a very old-fashioned scheme, with funds derived from the South American drugs trade being shuttled between as many as seven different accounts to confuse any pursuers before being transferred to their recipients. Were it not for the crypto element, this could have happened at any time since the 1980s, but it is the crypto element I want to focus on: and, once again, it was Tether’s USDT.

“Basically, it is used for what we are doing,” said Figuera in a tapped phone conversation transcribed in the affidavit. “It is used to transfer money in a quick way, even to make it get to jurisdictions that have some type of issues, etc. For example, to send it to China… Let me be clear with you, (USDT) is used a lot for laundering money.”

The USDT was transferred specifically on the Tron blockchain which, said FBI Special Agent Stephen Walker, “is commonly used by individuals involved in money laundering.” You may be rolling your eyes that I’m talking about Tether yet again. And while a day may come, to egregiously misquote Aragorn, Son of Arathorn, when I don’t bang on about USDT, it is not this day. Because there is an important point to make here.

Last week, Commerce Secretary Howard Lutnick went to Davos as part of a strong U.S. team that wasted no time in expressing its contempt for everyone else in Europe, if not the world. “With President Trump, capitalism has a new sheriff in town,” Lutnick wrote in the Financial Times. (Question to American readers: is this kind of clichéd Wild West tosh as jarring to your ears as it is to mine when a UK politician does that whole “my dear chap” posho act?)

On the face of it, the indictment of Jorge Figueira does indeed look like the stereotypical muscular American sheriff in action again, ropin’ up the bad hombres and bringin’ ‘em into town tied to his saddle. America has after all historically been very good at prosecuting financial criminals. But this new sheriff operates in new ways.

It was Lutnick’s company Cantor Fitzgerald — overseen since last February by his sons Kyle and Brandon — that provided Tether with the services it needed to operate, which back in 2023 no other major institution would provide. With Tether valued at perhaps $500 billion thanks to the healthy demand for its products from people like Figueira, Cantor’s own windfall from it could total $25 billion, enough to vault members of Lutnick’s family into the stratospheric wealth club.

The owner of the Tron blockchain meanwhile — our old friend Justin Sun, consumer of a $6.2 million banana, generous investor in the Pitcairn islands, and so on — has been a substantial investor in the Trump family’s World Liberty Financial, although the relationship has not been entirely smooth.

I have no personal experience of the American Old West, but I’ve watched a lot of Westerns, and traditionally a good sheriff’s family members do not profit mightily from companies named in the indictments that the sheriff brings, nor from those that help the sheriff’s strategic enemies build a whole new system outside of the sheriff’s jurisdiction. (If you’d like a more extensive, thoughtful and sophisticated version of this argument, without the silly jokes, I think this is a very interesting paper.)

Because it’s not just money laundering where companies like Tether are implicated. “The Central Bank of Iran has acquired at least $507 million in USDT, the US dollar-backed stablecoin,” notes Elliptic in this new piece of research. “The CBI also appears to be constructing a ‘sanctions-proof’ banking mechanism that replicates the utility of international dollar accounts. By treating USDT as ‘digital off-book eurodollar accounts’, the regime creates a shadow financial layer capable of holding US dollar value outside the reach of U.S. authorities.”

I’m sure everyone has either watched, read, or read about Mark Carney’s speech at Davos, and I think his conclusions — about mid-sized countries needing to help each other in this uncertain new world — apply as well to financial crime as they do to geopolitics. Their law enforcement agencies need to band together and start investigating the kind of companies that have been welcomed into the United States, and to stop relying on the U.S. to do their job for them because the new sheriff in town really is not like the old one. Perhaps these middle powers could call their cooperation “a posse.”

At present, however, I can see no recognition of the urgency of this task, although I notice that the European Union’s Anti-Money-Laundering Agency has laboriously ticked one more bureaucratic box in the mammoth task of thinking about maybe beginning to actually start doing something. Meanwhile, the UK has heroically completed part of a consultation into whether it should slightly change its own AML regulatory set-up.

One of the offshore centres I wrote about in my last book was Gibraltar, which has not had nearly as much scrutiny as places like the British Virgin Islands, partly because it specialises in gambling rather than kleptocracy, but also because a particular kind of Brit sees any criticism of The Rock as tantamount to spitting at the royal family.

But there are serious problems in this strange little overseas territory, with worrying implications for the governance of a place that has previously been central to several European smuggling networks and could easily become so again. “Sir Peter Openshaw’s findings are clear as light and day: the man running Gibraltar had tried several times to hobble a police investigation into matters relating to national security, which was grossly improper,” says this Transparency International report, which deserves reading.

My new book is very shortly to be out in the wild, and has even had a nice review, so I am doing lots of events (come along!) in which I tell people about how dreadful the world’s money-laundering system is and hopefully don’t leave them so depressed that they break down and cry, which in this line of work is always a risk.

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Launderers turn to the Euro, and an Arctic tax haven?

Oliver Bullough — Wed, 21 Jan 2026 13:55:00 +0000

It’s an accepted truth in much of the English-speaking world that the European Union is sclerotic, sluggish and weighed down by bureaucracy. Now that may or may not be true in the formal economy, but in the criminal world, a key statistic has indeed suggested that for several years European crooks have been falling behind.

The value of banknotes in circulation is a useful proxy for the size of the illicit economy, because they are used less than ever by ordinary people in ordinary transactions. So a primary source of demand for physical cash comes from criminals and money launderers. Since 2022, however, while the value of all the physical US dollars, Australian dollars, and pounds has been rising, the value of Euro banknotes in circulation has stagnated.

This is especially notable because, in the giant €200 bill, the European Central Bank provides a super-convenient banknote for transporting large values around in a relatively small box.

But it’s happy days for those looking for the green shoots of a revival in European criminal dynamism. In December, the value of Euro banknotes in circulation finally hit its first new all-time high — of €1.619 trillion — since June 2022, when it was €17 billion lower. Interestingly, however, the share of €200 bills in that total is falling. Consumers appear to prefer €100 bills and, if there are any money launderers out there able to explain why that is, please get in touch.

The Geenland gyp

I’m not going to express an opinion on the embarrassing idiocy of Donald Trump’s “policy” on Greenland, but I am interested in what the world’s biggest island would look like as the 51st state (as proposed in this bill from the improbably-named Congressman Randy Fine) from a financial crime perspective.

Greenland may be larger than Alaska, but it is the world’s least-densely populated territory, with only 57,000 inhabitants. That’s about the same number as people in Carson City, Nevada where there’s so little going on that it’s almost a relief to escape to the comparatively vast Reno, which isn’t something I’d otherwise imagine myself saying about such a barren wasteland. Greenland has a tenth of the population of Wyoming, the current least-populous US state, which might give you a clue about why I’m concerned should Greenland be accepted into the warm embrace of the USA. In recent decades, many of America’s least-populous states have enthusiastically embraced financial secrecy as a useful source of additional income, in that it allows them to swipe business/tax revenue from their larger fellows.

South Dakota and Delaware are the most famous examples, but Wyoming, Nevada, Alaska, Oregon and others are involved too. It is famously easier to get a shell company up and running than a library card in many states, and those companies help their anonymous owners evade tax, launder money, hide stolen wealth, and more.

One of the reasons for this phenomenon is that it’s just so much easier for lobbyists to get pieces of enabling legislation passed through the legislatures of small states, which have fewer competing industries and smaller numbers of lawyers. Now, if that’s the case in Wyoming, just imagine what it would be like in Greenland – laws could be rushed through in minutes, rather than hours. There’s no tax revenue to speak of, so why bother having any taxes at all? It would be a criminality haven for the ages.

It would, I admit, be quite amusing to watch the fury of Republican-voting states as they lost all this lucrative business to somewhere whose accession to the Union they had so enthusiastically endorsed. There would also be a tremendous irony in the extent to which shady Chinese and Russian money could pour through a secrecy haven even murkier than Delaware, considering the stated justification for the mooted annexation. But, more broadly, this would be absolutely awful for democratic accountability and other good things, so let’s hope it never happens.

Tether rides in with the cavalry

Tether, issuer of the world’s largest stablecoin USDT, has frozen $182 million worth of crypto that it thinks is linked to Venezuelan sanctions evasion. In this, it repeats a pattern familiar from its playbook of jumping aggressively to enforce Western governments’ rules just as soon as it has absolutely no choice about it.

The fact that Caracas was relying on USDT to fund most of its oil trade was common knowledge, helping both to support a corrupt and dictatorial regime and to ensure a healthy source of demand for Tether’s signature product for years. The same was previously true of Garantex, a Russian crypto exchange much used by criminals and sanctions evaders, which continued to shift large amounts of USDT for two years after it was designated by US authorities. When Garantex was finally shut down in a laborious joint operation by Finnish, German and US authorities, Tether rushed into belated action, freezing $23 million. Similarly, it hurried to assist US authorities only after Trump had sent in special forces to kidnap the Venezuelan president, thus keeping the money flowing till the bitter end.

It shouldn’t be necessary to say it, but this isn’t supposed to be how anti-money laundering works. The whole point of global standards is that companies report their suspicions to the authorities and freeze accounts while those suspicions are investigated, so that assets can be confiscated if shown to be of criminal origin.

With Tether, however, it appears to be the other way round, that is keeping silent for as long as possible until the authorities compel them to act, which may help explain why USDT is proving to be so very popular. After all, who wouldn’t want a version of the dollar without any of the downsides?

Tether insists that it does cooperate with law enforcement agencies, and recently announced a partnership with the United Nations Office for Drugs and Crime. “Supporting victims of human trafficking and helping prevent exploitation requires coordinated action across sectors,” said Paolo Ardoino, CEO of Tether, in a recent joint statement with the UN agency. There is a grim irony to this, considering that USDT remains the currency of choice for the horrific scam farms of Southeast Asia, where huge numbers of trafficked people are abused if they fail to meet their fraud targets.

“Aside from [the messaging app] Telegram, the cryptocurrency Tether also plays a key role in scam markets — the popular “stablecoin” is the preferred tool for all of the markets’ money-laundering transactions,” noted this analysis from Wired. “Tether and Telegram’s efforts to combat the ballooning scam industry’s use of their tools is comparable to Southeast Asian law enforcement’s minimal, often performative shows of raiding scam compounds, only to allow them to rebuild and resume operation.” Or indeed Tether’s performative rush to freeze Venezuelan crypto holdings.

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An email fraudster’s comeuppance & the age of the multi-centiBillionaire

Oliver Bullough — Wed, 14 Jan 2026 12:21:29 +0000

If there is such a thing as an iconic fraud, it’s probably the Nigerian 419 scam. If you had an email account 20 years ago, you’ll recall the emails, which came in by the dozen: “I am the widow of President Sani Abacha, I have hundreds of millions of dollars, can I borrow your bank account to put them in? I’ll give you a cut” kind of thing.

If you replied — “I’m sorry for your loss, of course you can borrow my bank account, I look forward to my cut” etc., etc. — then a correspondence would begin, and the scammer would eventually require you to pay a fee to arrange the transaction. If you paid the fee, the scammer would vanish, and you would be left wondering how you could have been so foolish, and lamenting the fact that your money was now in a bank in Beirut.

Until now.

The most random piece of New Year’s good news I’ve seen in some time is that “the Serious Fraud Office”" (SFO) has successfully recovered more than 400,000 pounds to be returned to nine fraud victims almost 24 years after they were defrauded.”

Abdullah Ali Jammal was the fraudster in question, but fled the UK before he could be convicted, so the SFO seized his money. Normally, if there has not been a conviction, the money goes to the government, but — in this case and, hopefully, in future ones too — it will go to his victims instead, who were laboriously traced in several different countries by law enforcement agents.

This is all very munificent (though it will be interesting to see if the UK’s generosity continues when larger sums of money are on the line), but the most interesting conclusion to draw is just how long financial crime cases take to come to any sort of conclusion. They are complicated, multi-jurisdictional, frequently packed with political and diplomatic complexities, and almost invariably feature defendants who can afford armies of lawyers.

My own personal favourite example is the case of Pavlo Lazarenko, a spectacularly corrupt Ukrainian politician who fled to California in 1999 when he fell from grace. This was an unwise choice of destination (there are reasons why they normally go to Russia or Belarus) and he was promptly arrested, tried and convicted on money laundering charges.

It is now 2026, he has been out of prison for more than a decade, but U.S. authorities have still not succeeded in confiscating his assets. Whole generations of lawyers have come and gone as the case has ground its way through the courts, yet Lazarenko fights on. I almost admire his tenacity, though I’m not quite sure what he is holding out for. Perhaps he is hoping for a pardon? To be fair, if he did receive one, he would be far from the least worthy recipient of late.

Money makes money and the money that money makes, makes money

Many thanks to the good folks at the Institute for Policy Studies for doing the sums on how U.S. oligarchs fared in 2025. “The biggest gains were among the top 15 U.S. billionaires, those with assets over $100 billion. This elite group saw their wealth surge to $3.2 trillion at the end of 2025, up from $2.4 trillion a year ago, a gain of 33% (more than double the S&P 500 increase of 16%),” the IPS said.

I know we’ve all got used to this, and we’d all rather think about something less depressing like climate change or the return of gonorrhoea. But it is worth thinking about how weird this is. Oligarchs’ already enormous wealth is growing twice as fast as the wealth of even those who can afford to own shares, let alone the 40% of Americans who are cut out of the stock market altogether.

Five years ago, Elon Musk was worth $25 billion, which is an unimaginable fortune in and of itself; now, he’s worth $716 billion, which is a sum greater than Belgium’s GDP. But then, five years ago, the sheer idea of a centi-billionaire was so astonishing that the creation of a new one was worthy of remark. Now there are so many of them that they’re not even all American any more.

This is bad news for democracy. No system supposedly based on equality but funded by political donations can survive for long when the richest 300,000 Americans own $19 trillion more wealth than the poorest 170 million. I am particularly concerned about how the oligarch class in the United States might copy their fellows in Russia and use the state’s machinery to maintain their grip on power if there is a backlash.

As such, I think it’s worth having a look at a report published last month from the House of Representatives Financial Services Committee on what Republicans and crypto-people call “Operation Choke Point 2.0”. In one interpretation, this is just a self-pitying conspiracy theory (named after a previous one), in which Joe Biden’s White House supposedly acted in the interests of monopolist banks and abused money laundering regulations to stop crypto firms from establishing themselves.

A more important interpretation though is to read the report and marvel at the huge amount of leeway that anti-money laundering (AML) regulations give to governments to exclude people and institutions from the financial system. Previously, this has largely affected Muslims, spuriously linked to terrorism in the UK, the U.S., Canada and indeed almost everywhere, and Russians accused of nothing much, and other marginalised groups. It has thus failed to gain the political traction it deserves, but it is genuinely a huge deal.

Authoritarian regimes have abused this power for decades and I think it deserves far more attention than it gets, so I’m actually quite pleased the Republicans are looking at it, even if they’re only doing it because it’s affected some big donors. The Cato Institute in this new report makes some very good points, not the least of which is the fact that there’s no evidence that the AML system is working anyway, so a proper re-examination of its inner mechanisms is long overdue. And perhaps with added urgency, given the question of whether you’d want those mechanisms to be in the hands of an authoritarian government with no interest in tackling corruption, but quite a lot of interest in swiping other people’s or indeed countries’ stuff.

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Cash moves everything around us & the Kremlin’s crypto gambit

Oliver Bullough — Wed, 24 Dec 2025 13:55:00 +0000

I am, I freely admit, more interested in the “cash in circulation” statistics published by major central banks than most people are. Month after month, we see the value of cash dollars, cash pounds, cash rupees, you name it, hitting fresh highs. Even staid old euros, which peaked in the COVID times, are inching towards a new high and, if the same spike in circulation seen every December happens in 2025 as well, I predict we’ll see a fresh record before the year is out.

Why is this important? Because it “shouldn’t” be happening. People use far fewer banknotes in transactions these days, so there should be less demand for them, so central banks should be issuing fewer of them, so the total in circulation should be falling. But the reverse is true. Central bankers call it a paradox, chuck out a few explanations for the mystery source of demand concerning inflation, ATMs and distrust of the financial system, and move on.

What they almost never do is ask whether demand for their products comes from criminals using banknotes to hide, move and launder their illicit wealth, which is weird because that is obviously what is happening. Why else would the most popular form of cash dollar be the $100 bill? I don’t know what explains central bankers’ profound lack of curiosity about the impact of their signature product (perhaps how much income they derive from it?), but it appears now to be infecting the crypto space as well.

Last week, the Federal Reserve published a new paper called “Banks in the Age of Stablecoins”, discussing what these fiat-pegged cryptocurrencies mean for the traditional financial system. Like all central bank papers, it is jargony, infested by Greek letters, and curiously banal (“the rise of stablecoins presents challenges and opportunities for traditional banking”), but I’m more interested by what it leaves out. If you do a ctrl-f on the document, you will find zero uses of the words “launder”, “crime”, and “illicit.”

I appreciate that analysing the misuse of financial instruments by criminals is not the Federal Reserve’s job, and that its analysts are interested instead in stuff like the stability of the financial system, but the problem is that it isn’t anyone else’s job either.

This means that, as with banknotes, no one is standing back and asking: why are these things so popular, are we okay with that, and should we have a bit of a think before unleashing them on the world?

The currency of sabotage

In the absence of such thinking, business is booming. Tether, the world’s largest stablecoin company, has just offered to buy Juventus — the Italian chief executive’s favourite football club — and to invest a billion euros in it. This is the kind of profligacy associated with Russian oligarchs back when they were really coining it, but not what you’d expect from a financial institution. Particularly when the prudent thing might be to lie low, given the accusations of complicity in financial crime.

“It is reprehensible that Tether would let so much money flow through a service flagged for money laundering,” a former prosecutor is quoted as saying in a very troubling recent piece from the International Consortium of Independent Journalists. “They should have frozen this.”

The vast majority of stablecoins are denominated in dollars, which means their issuers need dollar reserves, thus ensuring healthy demand for U.S. government bonds, which helps to explain some of the enthusiasm for them in Washington, DC. But I’ve just been in Moldova for a week, talking to people about how very close the country came to succumbing to Russian interference in recent elections. The authorities worked tirelessly to intercept cash couriers and block bank transfers from Moscow, in their efforts to secure the integrity of their democratic process.

But there was nothing the Moldovan authorities could do about crypto. Russia has now overtaken the UK as the biggest crypto market in Europe, with a 32% growth over the past year, most of it driven by transactions larger than $10 million. Ordinary Russians don’t have that kind of money to move, so this has nothing at all to do with the mooted “democratisation of finance”, and everything to do with the Russian state seeking financial channels outside the oversight of the West.

The Kremlin may have lost the battle to influence Moldova’s elections, but it learnt an important lesson from the battle. Don’t bother paying thousands of couriers to each smuggle $9,900 in cash on flights via Yerevan or Almaty, just use crypto and move as much as you like. Now, they are hiring petty criminals to engage in sabotage, arson or espionage activities and paying them in crypto in a way that threatens to overwhelm Europe’s financial and physical defences. I can see how, from the safe distance of the United States, decision-makers prefer to focus on the profits they’re personally making from crypto, rather than the potential harm their adversaries could cause their country by using it.

But, if I could wish for one thing for Christmas, it would be for them to wake up. This isn’t going to stop at Moldova.

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Making corruption great again

Oliver Bullough — Wed, 17 Dec 2025 14:00:00 +0000

We all know corruption is bad for a society as a whole, which is why there are laws against it. But individual companies or people personally benefit from paying or taking bribes, so what’s stopping them: the fear of getting caught, or a desire to do business properly? Normally that’s a question we can’t definitively answer, but this spring the U.S. government — by pausing enforcement of its main anti-corruption law, the Foreign Corrupt Practices Act (FCPA) — gave us a perfect natural experiment.

“On the day of the executive order, former FCPA targets whose stocks are publicly traded experienced returns on equity markets that were about 0.69 percentage points higher than what would have been expected from stock market trends. The effects cumulated substantively, resulting in capitalisation gains for the portfolio of past targets of corporate corruption cases of about $39 billion and outsized returns to shareholders,” found three academics in a new paper titled ‘Making Bribery Popular Again?’.

The conclusion is clear. Investors thought that the threat to the future profitability of the 261 companies previously targeted for enforcement action was caused not by the corruption itself. What the investors didn’t like was the prospect of those companies being prosecuted for corruption. Once that threat was removed, they were happy to invest regardless of possible corruption. Interestingly, the average increase in the market capitalisation for the companies — $160 million — matched the size of the average fine previously imposed under the FCPA. Truly, capitalism is a magical thing.

To say that corrupt people and/or companies do well out of corruption may not sound particularly controversial, but this has important implications for how policies should be structured in a world where an important country has decided to stop doing the right thing. Enforcement matters and, if the U.S. has stepped back, everyone else needs to step forward.

The paper’s publication coincided with a report from Reuters looking at the impact on tax enforcement of the U.S. now that the government has sacked loads of tax enforcement agents and attorneys. Funnily enough, it isn’t great. Prosecutions have declined by 27%.

Again at the risk of being obvious: if you want people to be honest and to pay their taxes, you need to prosecute people that aren’t. Alternatively of course, if you don’t want either of those things, you can pause enforcement of key legislation, and sack everyone involved. After all, why bother going to all the trouble of changing the law when it’s so much easier to stop enforcing it? From there it’s a short hop to going full Kremlin and selectively enforcing the law against your enemies. Happy days.

It’s a sign of how grim global public debate has become that it’s genuinely refreshing that the UK’s new anti-corruption strategy so straightforwardly comes out and says corruption is a bad thing, and that the country will work harder to fight it. It’s a pretty good document, all being said, though it could be far more ambitious in how it tackles lobbying, abusive lawsuits, and conflicts of interest.

I was also sorry not to see firm commitments to toughen up rules around electoral funding: at the very least, there should be caps on donations, restrictions on the use of shell companies to disguise the identity of donors, and limitations on how foreign companies can route money into UK politics. “The strategy acknowledges that restoring trust in government is ‘the great test of our era’ yet it fails to address the elephant in the room,” said Daniel Bruce, the chief executive of Transparency International UK.

This is important. It doesn’t much matter how good the laws you pass to protect a country from dirty money are, if you don’t also secure its commanding heights against takeover by corrupt or ill-intentioned actors. Because they can then buy electoral victory and cease the enforcement of all those excellent laws, just like Trump did with the FCPA.

So it’s urgent that European democracies take steps to keep corrupting wealth out of their politics before it’s too late. We are accustomed to stories about Russian money, or Chinese money undermining democracy, but the White House’s national security strategy now explicitly states that America too intends to support European fascist (“patriotic”) parties. Liberal democracy is under attack from all sides and needs to get a lot better at defending itself.

An anti-corruption Oscars?

This is all a bit depressing, but it is the festive season so let’s cheer ourselves up a little. There are countless people toiling away at considerable cost to themselves to reduce corruption and to protect democracy, and they deserve a lot more recognition than they get. I’ve been talking to some friends about the best way to provide that, and obviously prizes are one idea.

The Organised Crime and Corruption Reporting Project (OCCRP) has traditionally given an award to the “Person of the Year in Organized Crime and Corruption” to highlight villains, such as Bashar Al-Assad in 2024, or Danske Bank in 2018. But it has clearly decided that there is already more than enough irony in the world now that Donald Trump has won the first ever FIFA peace prize, so it’s changed focus and collected nominations for “Anti-Crime and Corruption Heroes” instead. Winners are due to be selected this month. This is a good initiative, and I’m looking forward to seeing who they choose.

Elsewhere, there’s the Allard Prize and the ACE award (you may have questions about an anti-corruption prize supported by Qatar, considering some of the ways its government goes about its business, but the list of previous winners includes lots of good people). It would be nice, however, if there was something ritzy and glamorous, an integrity Oscars where people committed to making the world better could be celebrated like Hollywood A-listers.

So, this is where you come in. Send in ideas. How would it work? Who should be nominated? Who should decide the winners? What should they win? Which top-end venue should host the ceremony? Should Ricky Gervais be brought in to do an incredibly dull comedy ‘roast’? Should we invite an oligarch and/or financial institution to sponsor it in return for naming rights (“the HSBC Anti-Corruption Champion of the Year”)? How often should President Trump win before we give someone else a turn?

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Can Britain clean up its overseas tax paradises?

Oliver Bullough — Wed, 10 Dec 2025 14:00:00 +0000

A century ago, British statesmen discussed creating a mighty Imperial Parliament, in which every part of their globe-bestriding empire would have representatives in London. That never happened and instead we have the significantly-less-glorious Joint Ministerial Council, in which leaders of the various British territories too small, too strategic or too volcanic to have yet become independent come to the UK and discuss things.

The British constitution is a ramshackle thing, bashed together over the centuries, and technically the government in London could just tell these Overseas Territories (OTs) what to do. But it prefers to be democratic about it, so the JMC is what we have instead. It matters because several of these OTs have long been among the world’s most egregious tax/secrecy havens – the Cayman Islands, the British Virgin Islands, and Bermuda were the top three in 2024’s Corporate Tax Haven Index – and it would be nice if they stopped.

Back in 2018, two backbench MPs persuaded parliament to pass a law forcing the OTs to open up their corporate registries, so as to stop them selling shell companies to the world’s financial villains, but progress has since been slow.

“If any Overseas Territory continues to defy the will of the U.K. Parliament, the Government should be prepared to escalate its response. All legal and constitutional options should be on the table to ensure these commitments are delivered in full and without further delay,” said Transparency International last month.

Not all the OTs are being defiant – Saint Helena is doing great, as are the Falkland Islands -- but most of them are not havens for shell companies so they’re not relevant. The one that matters most is the British Virgin Islands, and it is not knuckling down at all. To access the BVI’s register, you need a “legitimate interest”, and the owner of the company you’re looking at will be tipped off and be allowed to object.

“This mechanism could expose journalists or civil society organisations to physical or legal intimidation by those looking to hide their identity. It also provides the opportunity for those being investigated to liquidate or move illicitly obtained assets to avoid detection,” said TI (which also had other objections).

It’s hard to overstate quite how central the BVI’s shell companies have been to globalised financial crime. Impatience with its foot-dragging is completely understandable, but – at the risk of being that person – we do need to recognise that things are more complicated than they at first seem if we want a durable solution.

Almost three-fifths of the BVI’s budget comes directly from the fees paid by companies listed on its corporate registry, and the law firms and other services that work for those companies are a significant local employer. Previous transparency drives have clearly affected the islands’ attractiveness: it had more than 480,000 companies on its registry back in 2014, which was before the British government insisted that its police could access the database. It only has 360,000 now, and monthly incorporations have dropped from 12,000 to 7,000.

Before the BVI became a tax haven, it was extremely poor, and its current prosperity is entirely due to the attractiveness of its shell companies. Its politicians therefore are as reluctant to embrace transparency as a petrostate would be to join the global net zero movement, and no amount of finger wagging is going to change their minds.

Besides, London’s chances of having its wagging finger heeded were really not helped by the fact that the 2018 vote in parliament applied to Britain’s Caribbean tax havens but not to European counterparts like Jersey, Guernsey and the Isle of Man. The MPs’ intentions may not have been racist, but the outcome was, which unsurprisingly rankled people in the BVI.

British politicians can of course tell OTs to find a new way to make a living because enabling kleptocracy is reprehensible; but then BVI politicians can reasonably reply that the only reason they were so poor to begin with was because Britain enslaved their ancestors, failed to compensate freed slaves, and then followed up with 150 years of neglect.

The solution to me is a genuinely just transition in which the U.K. recognises that, because it encouraged its OTs to become tax havens in the past in order to save its own budget, it now has a responsibility to help them find a new way to make a living in the future. This will take time, require thought/compromise, and cost money, but – unlike the current approach – it might actually work.

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Terrorism’s crypto financiers & Trump’s clemency habit

Oliver Bullough — Wed, 03 Dec 2025 14:00:00 +0000

It is bad for a financial institution to be convicted of helping to launder money, but it is catastrophic to be convicted of helping to finance terrorism. This is why the civil case recently launched in North Dakota against Binance, in which the crypto giant is accused of helping “Hamas, Hezbollah, Palestinian Islamic Jihad, and Iran’s IRGC-QF, to move and conceal over one billion dollars through its global platform”, is so significant.

The suit has been brought on behalf of 306 American victims of the October 7, 2023 Hamas attacks in Israel, and alleges that Binance accounts transferred $300 million to Hamas and other terrorist organisations, and received $700 million from them, figures that dwarf the sums detailed in the criminal prosecution of Binance that led to its $4.3 billion fine two years ago.

“This was not a compliance lapse, it was a business model,” said Jonathan Missner, managing partner of Stein Mitchell Beato & Missner LLP, the law firm behind the case. “Our investigation shows that Binance built systems designed to evade oversight, using its off-chain network and weak controls to move enormous sums for sanctioned groups. This platform became a conduit for financing murder, kidnappings, and rocket attacks. The families deserve justice—and the public deserves transparency.”

In a previous case brought under the same legislation, Jordan’s Arab Bank was sued and – despite procedural wrangling that went on for years -- ended up settling with the victims for an undisclosed but significant sum of money.

Anything that forces Binance to start taking its responsibilities to victims of crime as seriously as it takes its willingness to accept money from perpetrators of crime is a good thing. And if you want to see how widespread those crimes can be, read this excellent investigation from the ICIJ which finds crypto platforms to be “awash with dirty money.” But there are always particular challenges around terrorism funding, which can have perverse outcomes.

In contrast to drug cartels, for instance, terrorists move relatively small amounts of money, which means financial institutions have to monitor a far larger array of transactions if they want to protect themselves from a lawsuit. Because terrorists use banks in the same way as anyone else does, what this tends to mean is that very large numbers of ordinary people lose their accounts just so compliance departments can be sure to sweep out the terrorists.

The result is the under-discussed phenomenon of debanking, which overwhelmingly affects Muslims and charities targeted towards Muslim beneficiaries.

“Humanitarian charities are facing banking barriers because banks are adverse to giving large transactions to countries they deem a risk, like Syria,” said Abdulsami Arjumand, a senior executive at the U.K.’s Muslim Charities' Forum. “Banks determined to avoid any heavy fines from the US treasury or the FCA act with very strict risk appetite… There is a balance to strike between securing aid and fighting financial crime. At the moment, we are far from that equilibrium.”

People excluded from traditional finance by this kind of inherent unfairness have turned to cryptocurrencies, and it would be a shame if the Binance case were to lead to the same injustices being imported into the crypto world as well.

A sidenote to the Binance case is the fact that the company’s founder – Changpeng “CZ” Zhao – was recently pardoned by Donald Trump who claimed that Zhao was the victim of an anti-crypto witch hunt by Joe Biden.

In reality, he was jailed (and his company fined $4.3 billion) because of Binance’s complete failure to maintain any kind of anti-money laundering programme. At the time, one Binance compliance staffer wrote: “We need a banner ‘is washing drug money too hard these days - come to binance we got cake for you’.” And though Zhao stepped down and Binance pledged to change its ways, it appears to have done little to stem the tide of dirty money flowing through its systems.

Zhao’s hard-to-explain pardon once again draws attention to the peculiar folkway of the U.S. pardon process. The presidential ability to pardon people derives from the States’ origins as British colonies. It is something that kings could do back in the 1770s. Technically, King Charles III can still pardon anyone he likes, though he almost never does, which is something else he doesn’t have in common with Donald Trump.

Of course there have been controversial pardons in the past, but often they come at the very end of a presidential term. Trump seems to be unusual in his willingness to hand them out this early. It must have been particularly demoralising for the prosecutors who worked hard to secure a conviction against David Gentile, only to see him released after serving just two weeks of a seven-year sentence for defrauding more than 10,000 people.

Binance denies any wrongdoing related to the Hamas case. Still, it does raise the interesting prospect of Trump having to defend his decision to pardon a man subsequently ruled to have helped Hamas move its money. But then, CZ was already convicted of helping Iranians, Syrians, North Koreans and the Russian occupiers of Ukraine move money in defiance of sanctions, and Trump hasn’t faced any backlash for pardoning him for all of that, so perhaps not.

A plague on both their houses

In unrelated but entertaining crypto news, there’s a spat brewing between the hip young dudes at Tether, and the boring old squares at Standard and Poor’s, after the rating agency cut its rating for the stablecoin issuer to its lowest possible level, which I thought was fair comment but which Tether CEO Paolo Ardoino got rather irate about. “Tether is living proof that the traditional financial system is so broken that it's becoming feared by the emperors with no clothes,” he wrote in one of a number of posts on X in which he demonstrated how little he cared about S&P’s opinion by talking a lot about it. He later posted a clip from the movie ‘The Big Short’, in which a rating agency employee defends the absurdly high ratings given to mortgage bonds before the 2007-8 financial crisis. That too, it must be said, is fair comment. It would be nice – rather like a rugby match between South Africa and England – if we could find a way for both Tether and S&P to lose.

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Tether, Trump and the twisty road to transparency

Oliver Bullough — Wed, 26 Nov 2025 14:00:00 +0000

A year ago, Britain’s National Crime Agency revealed how they had busted a giant Russian-run money laundering scheme, which was helping oligarchs, propaganda outlets and spy agencies to dodge sanctions. Now, it’s back with an update on its efforts that is both hopeful and alarming.

It’s good that they’ve managed to trace the network further, linking it to Russian-Moldovan-Israeli tycoon Ilan Shor and a bank in Kyrgyzstan, but also worrying that the organisation appears still be to be functioning. Two cash couriers were busted carrying around £2 million each, which also does not suggest the organisers are too stressed: you don’t carry that much money in one go if you’re concerned about being caught.

The core of the scheme is that the money launderers collect cash from criminals all over Europe, and swap it for the cryptocurrency USDT (I published this about the issue earlier this year), and so it remains. “Tether, from what we can see, at least, appears to still be the majority token used by these networks,” a law enforcement source said.

Perhaps the most interesting difference between the boring old banks and the exciting new crypto industry is that, if a boring old bank had been so deeply involved in moving so much criminal wealth, it would have been fined a nine-figure sum and forced to radically change its ways. But Tether suffers no such indignities. Thanks to the inflation of the Trump crypto bubble, Tether made profits of $10 billion in the first three quarters of 2025, and is still coining it, despite the publicity around this operation and many other allegations of money laundering.

It now owns 116 tonnes of gold, which is more than Greece, South Korea or the UAE. Last week Tether spent a billion dollars on Bitcoin, though that didn’t do much to arrest the slide in the Bitcoin price, which as I write this has dropped by a third since its peak in early October, and erased all of its gains since Trump’s 2024 election win. Tether also claims to own $135 billion of US government debt. So, to cut a long story short, it’s basically as potent as a reasonably-sized central bank, and doesn’t have to care what a law enforcement agency thinks of it.

“Look, you can point to various different parts of the global crypto infrastructure where you would say, ‘wouldn't it be great if you could rain fire upon them?’ And me, as a law enforcement professional, would say, ‘yeah, it'd be brilliant, right?’ But obviously, I don't have that capability at my fingertips,” the same law enforcement source said, which was pretty funny but also depressing.

Obviously, there’s not much anyone can do to limit crypto while Trump controls all branches of the U.S. government and his family members continue to do so well out of it, but it would be interesting to see what might happen if the Democrats won a majority in one or both of the houses of Congress, considering some of the questions they’re already asking.

“Every time a governance token is sold, three-quarters of that money goes directly to President Trump and his family, even for sales to entities linked to North Korea and Russia,” said Senators Elizabeth Warren and Jack Reed in a letter to the Department of Justice. That’s the kind of allegation that could lead to some spicy committee hearings.

A small step towards transparency

Dr David Richard Hull gained a small footnote in the history books last week when he became the first person to verify his identity on Companies House, the UK’s corporate registry, which is trying hard to move from being part of the problem to part of the solution (at least The Dark Money Files’ Graham Barrow said he was, and Graham Barrow does tend to know).

For a long time, it was generally reckoned that the easier and cheaper it was to create a company, the more vibrant and dynamic your economy would be, and in few places was this principle applied more enthusiastically than in the UK. This unleashed a tsunami of shell-company-powered money laundering, with criminals buying British corporations for less than the price of a round of drinks, and using them to hide their identities.

Eventually, officials realised that rampant financial crime was actually bad for the economy, rather than beneficial, so brought in new checks on the identities of those creating companies. There is a lot of mess to sweep away before the corporate registry is truly cleaned up, but this is a good start, though it would be even better if some of the more far-flung bits of British territory could be persuaded to embrace transparency as enthusiastically.

There are similar registration rules in most European Union countries, although their registries are not necessarily open to everyone, as this survey from Transparency International shows. Of course, the United States has given up on its efforts to open up corporate registries, despite convincing arguments that shell companies from lax states like Nevada are a clear threat to national security.

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‘Iceberg, right ahead’ & the rise of Chinese laundries

Oliver Bullough — Wed, 19 Nov 2025 14:00:00 +0000

I’ve been reading journalist Andrew Ross Sorkin’s new book about the 1929 crash, and it’s been sending me into a bit of a spin. The parallels between the financial speculation Sorkin details and the present day are remarkable. Meme coins – like $TRUMP and $MELANIA – may be the most remarkable of recent financial innovations. They have no intrinsic value, are not intended to have intrinsic value, and yet they soar in price, enriching their issuers, before collapsing and erasing everyone’s money. Why would anyone invest in them? Is everyone stupid? Well, why did people invest in new stocks in the late 1920s, despite the vertiginous valuations?

“They were not necessarily ignorant or dumb,” is how Sorkin describes it. “They might know, or guess, that an investment pool was manipulating the price. But if they got the timing right, even a total outsider could capture a bit of the upside before the pool ‘pulled the plug’ and dumped its shares back on the market.”

It’s a weird truth about pyramid schemes: they’re actually very profitable if you get into them early enough, and no one knows when the money’s going to stop flowing so people keep investing even after they know it’s a con. There are very many places in the book when it felt like it could be about 2025 – the importance of murky lending to supporting asset prices; the corruption of the political class; the arrogance of the strutting business tycoons; the insistence that predatory practices were actually “democratising finance” and so on.

Above all, I feel a constant melancholy over how none of the foot soldiers in this campaign had any idea about the size of the wave rearing over them, and how it would sweep away everything for a generation. The subtitle of the book refers to the 1929 catastrophe as “the greatest crash in Wall Street history”, and I worry that it might before too long be relegated to being the second greatest. Buy the book, that’s my advice, while you’ve got some money to spare.

So anyway, to distract myself from the depressing nature of my historical musings, I listened to the latest episode of The Laundry podcast, which is a thoughtful and in-depth interview with Elisa de Andro Madazo and Giles Thomson, respectively the president and vice-president of the Financial Action Task Force, the world’s standard-setter on fighting money laundering.

They are articulate and clearly both care and think deeply about their institution, as well as about their roles within it. They expressed careful and coherent opinions on the need to bring fairness and efficiency and effectiveness to a struggle that has (my words, not theirs) too often lacked all three.

But, in a world in which cryptocurrencies are sweeping aside controls on finance, the United States has given up on corporate transparency, criminal groups are driving sanctions evasion, Chinese money laundering gangs are gaining ever-greater influence, and Western laws are failing to tackle kleptocrats, everything they said just seemed so irrelevant. Once again the historical parallel for the FATF was an institution in the interwar years. The League of Nations was a bureaucracy that was well-meaning, tireless, thoughtful to the end, but completely ineffective when faced with challenges from powerful nations.

Laundering drug money

I mentioned Chinese money laundering organisations (CLMOs) above, and I’d like to draw your attention to this excellent new paper, from venerable British think tank RUSI, about their scope, approach and significance. The growth of Chinese gangs, and their rapid takeover of much of money laundering conducted for organised criminal groups (OCGs) over the last decade or so, is a remarkable and ill-understood phenomenon.

The secret of their popularity is not hard to understand, as the paper makes clear: “all the profit is made in China and therefore CMLOs can afford to offer their services to OCGs in the West for free, or close to free”. Traditional money launderers were charging Western criminals perhaps 15 percent to move money, so it is clear why OCGs would prefer to take their business to someone who’ll do it for nothing.

The CLMOs’ techniques are based around transferring value globally outside the banking system (i.e. by moving luxury goods, commodities, cryptocurrencies, etc) which means that much of the compliance system created under pressure from the FATF is essentially useless in detecting their activities.

But why have they been able to launder money so cheaply when their Western rivals could not?

I think the more important point to take from this is that they have been able to create their system because of restrictions imposed in both China and the West. Chinese capital controls have made it hard for wealthy citizens of the People’s Republic to get their money out of the country. Meanwhile Western drug laws have created a huge cash-rich criminal economy. It is by connecting this demand for cash (from Chinese people outside China) and supply of cash (from drug gangs in the West) that CMLOs have been able to corner the market.

This is perhaps an unpopular opinion, but I’m going to offer it anyway: if you need another reason to take drug supplies out of the hands of criminals, CLMOs are it. Prohibition hasn’t just failed on its own terms, it has created the liquidity for a vast underground economy being exploited by our geopolitical rivals.

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Dinosaur bones, lottery tickets & upside-down skyscrapers

Oliver Bullough — Wed, 12 Nov 2025 14:00:00 +0000

I am often rude about how utterly predictable financial criminals are in what they choose to buy – large watches, gold-spattered handbags, ugly yachts, etc – so I want to give a very small amount of credit to Su Binghai, a money launderer with an imagination. Okay, so he bought nine apartments in London, spending about $21 million just a week after he evaded police in Singapore. And, sure, he abandoned a collection of supercars in Singapore, all of which is tremendously dull. But then among the assets seized by Britain’s National Crime Agency (NCA) were “dinosaur remains, between 145 million and 157 million years old… of a mother and baby Allosaurus, as well as a Stegosaurus.” Dinosaurs! Aren’t they gorgeous? So much more beautiful than a boring old car.

The extinct mega-beasts were sold at a Christie’s auction last year for around $15 million, but are now in a warehouse, presumably ready to be resold, (unless the NCA plans to keep them. I can see the appeal of having something so magnificent as a dinosaur skeleton as a centrepiece in your house, although I do worry a little about the amount of dusting required, which may be why other money launderers have not invested in fossils. “I doubt that any of us will be dealing with one of these again,” said Judge Gavin Mansfield during the hearing. What a shame.

The value of the properties and fossils is a tiny fraction of the amount already recovered in Singapore in this case, which is said to have involved more than $3 billion, though it is troubling that many of the fugitives involved appear to have won effective immunity from prosecution in return for surrendering their assets.

Which cryptocurrency was involved in the scheme, I hear you ask? Well, funnily enough, it was Tether’s USDT like it always seems to be. Involvement in multiple scams has not been holding Tether back. Quite the reverse; in the first nine months of the year, it made $10 billion in profits, and expects to make $15 billion in 2025 as a whole. If Tether is not the most profitable company per employee in the world (it employs about 200 people), I’d like to know what is.

One of the few people who appears not to have been using Tether to hide illicit wealth was the former EU Justice Commissioner Didier Reynders. Though maybe he should have been. Reynders was recently charged with money laundering in Belgium in perhaps the strangest scheme I’ve read about this year. Reynders spent nearly $60,000 on lottery tickets in a single year.

Now, lotteries have been used by financial criminals for a long time. My favourite money laundering approach ever was one used in Puerto Rico in the 1980s when criminals would buy lottery tickets at a premium in cash, then (unconvincingly) explain to the authorities that their wealth was simply the result of weekly outbreaks of good fortune.

According to investigators, however, Reynders was doing something else. He was spending unusual amounts on lottery tickets and keeping the winnings. Why is this strange? Unlike gambling in a casino, lotteries are not a good way to launder money, because they distribute as prizes less than two thirds of what people spend on tickets, so you lose a huge amount on the trade. It’s really not very clever and, clearly, the unusual spending pattern raises the authorities’ suspicions. Reynders denies laundering money, and says he was just using private wealth. Whatever happened, he has a lot to explain.

The thankless task of crypto regulation

Reynders may not have tried to launder money via crypto, but many financial criminals do. And over in Washington, DC, regulators have got to do the boring-but-important work of figuring out how exactly the new GENIUS act controlling stablecoins will be implemented in practice. So credit to Transparency International U.S. for attempting to bend things in the direction of sanity. “A well-implemented framework can both support responsible innovation and prevent the kinds of corruption and financial crime that erode trust in financial systems and global markets,” it wrote in a letter to the Treasury Department.

Bitcoin prices may have taken a bit of a dip of late (no doubt irritating Donald Trump), but the crypto enthusiasm stoked by the White House shows no sign of abating. Senate Democrats sent a letter to the attorney general after Trump’s pardon of former Binance CEO Changpeng Zhao with a killer final question/essay prompt: “Do you believe President Trump’s substantial business ties to Mr Zhao influenced his decision to issue a pardon? Explain.”

Richard Teng, who now runs Binance, has denied that his company supported Trump’s own (largely moribund) stablecoin USD1 to curry favour with the first family on his predecessor’s behalf. But considering quite how much money the Trumps have made this year (Trump’s net worth has risen by $3 billion, according to Forbes), it seems unlikely they’ll concern themselves overmuch with the rules, let alone the complex, detailed rule-making around the GENIUS act. On the one hand, this leaves the field open for organisations like TI-US to push for good regulations; on the other, Trump will do what he wants, regardless of the regulations.

The Neom debacle

Trump, though, is not yet a law unto himself. Unlike, say, the Saudi royals. I have a slight obsession with Neom, Crown Prince Mohammed bin Salman’s pet development involving a ski resort, a superyacht harbour and The Line, a ludicrous mirrored linear city which a gazillion architects have been designing at a gigundous profit. Anyway, thanks to the FT, we have a deeper dive into this vainglorious horror show than we’ve ever had before.

There are many, many cars in this pile-up: the 30-storey building that would supposedly hang from the top of an arch over the harbour, despite architects warning that it would inevitably fall on everyone’s yachts below; the “hundreds of shuttle cars running back and forth” to pick up the poo because normal sewage systems couldn’t be made to work; the fact no one realised that buying more than half of the world’s steel each year to build Neom would affect steel prices; the airport shuttle envisaged without any room for luggage; the giant pumps required to circulate water in the giant marina; the disaster in store for migratory birds faced with a 500- metre high, 170-km wide mirror and so on and so forth.

“I was in a conversation one day with two physicists, quantum physicists,” says Antoni Vives, then Neom’s chief urban development officer, in a documentary about The Line. “One of them looks at the other and looks at me, and says: ‘you know what, perhaps it’s the time of the poets now. We need poets’.” No, Antoni, we need satirists. Or maybe sedatives.

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Dubai’s blockchain blues & the Kyrgyz ‘cryptatorship’

Oliver Bullough — Wed, 05 Nov 2025 14:00:00 +0000

Last week I went to Dubai. I didn’t much like it; Dubai feels as if the brief was to build a city but to leave out all the things that make cities good. Then again, I was there for a crypto conference. And my overall impression of that was – if Western sanctions are indeed shutting Russians out of the world economy, someone should tell the Russians.

The free ice cream at the gate was sponsored by a crypto company promising seamless exchanges between roubles and the dollar stablecoin USDT; an exhibitor offered to deliver you cash in an hour when you transferred them some crypto; and the title sponsor was A7A5, fresh from being sanctioned by the European Union, but very much alive, kicking, and cheerfully distributing stickers to people who took a spin on its wheel of fortune.

The centre of the hall was dominated by a crypto-trading competition, in which a number of people sat behind screens and sought to make a profit while against the clock. Despite the best efforts of two fast-talking Russian MCs, as a spectator sport, it had all the charm of watching an HR department finishing up the month’s payroll. Still, the competition drew the biggest crowd simply for the lack of other things going on.

None of the whales that might once have come to a Dubai crypto conference were present, now all the action has spectacularly moved to Washington, DC. Check out this Reuters investigation into how much cash The Trump Organization has made in just the first six months of 2025: “the U.S. president’s family raked in more than $800 million from sales of crypto assets in the first half of 2025 alone”, with “potentially billions more in unrealized ‘on paper’ gains”, mostly from foreign sources.

Those who did make it to Dubai intoned the usual verities about crypto ushering in a new age of liberty, despite the huge contradictions all around them. Particularly bewildering was a panel featuring Vít Jedlička, a Czech libertarian and founder of “start-up nation” Liberland, alongside Nabil Arnous, whose job is to bring investment into “Innovation City”, a newly-renamed AI-powered free trade zone in the absolute monarchy that is Ras Al Khaimah, one of the seven emirates that make up the UAE. The blockchain is powerful indeed if it can unite people from such supposedly opposite political poles.

Even more head-scratching to me though was a presentation by Reeve Collins, who co-founded Tether and was an early advocate of all things crypto, He came to Dubai to pitch his idea for “white label” stablecoins which would allow companies to put their name on a dollar-pegged cryptocurrency while leaving all the hard work of running the blockchain to someone else.

Why might companies want to do that? Because every time they sell something, they get to collect even more data about their clients than they already do, as well as earning profit from issuing money that currently goes to the government.

“Since this is programmable money, you get real data on all of the users, and you get to understand who are the power-users, who deserves more, who deserves to be rewarded,” Collins said. “This is loyalty points times a thousand. It really will supercharge what companies are able to offer their users, so they'll be able to extract more value.”

I kept expecting someone to speak up and point out how far his vision had strayed from cryptocurrencies as a tool for individual autonomy, rather than a tool that enables the world’s largest corporations to frack humanity even harder than they are now. But no one did. Instead, the conference moved onto a panel about how governments couldn’t be trusted.

At some point the music will stop, and none of us will have chairs, and there will be an almighty blow-up. The prospect slightly terrifies me.

Kyrgyzstan's crypto compulsion

For now, though, the music is very much still playing. Particularly in places like Kyrgyzstan, which seems to be doubling down on its strategy of becoming a ‘cryptatorship’ like El Salvador. Binance founder Changpeng Zhao, the crypto billionaire who pleaded guilty to violating U.S. anti-money laundering laws and was recently pardoned by Trump – though the U.S. president claimed not to know Zhao – headed to Bishkek to talk up its transformation. “Had a great time in Kyrgyzstan in the past two days. I encourage more crypto companies to explore the country too,” he Xed.

There are already a number of crypto companies in Bishkek, including the sanctioned A7A5, and their close connections with the Kyrgyz government are of great interest to the country’s journalists. However, since Kyrgyzstan’s best investigative outlets – Kloop, Temirov Live and Ayt Ayt Dese -- have just been labelled as extremists, it will be difficult for reporters to bring attention to their findings.

“This is the first time in the history of Kyrgyzstan when media outlets have been labelled extremist,” said Kloop in a statement. “Now it is dangerous to like or share outlets’ material, or to circulate it. That could all be considered support for extremist organisations and the circulation of extremist material.” At least, “watching and reading it is currently safe.”

There used to be something admirable about Kyrgyzstan’s bloody-minded refusal to become a dictatorship like the other republics of Central Asia. Now there is something grotesque about the fact that it is the lure of crypto, a technology supposedly intended to enhance freedoms, that is helping to cement autocracy. The country is holding snap parliamentary elections on November 30. The president’s party, unsurprisingly, is expected to do very well.

Watching Kyrgyzstan heading towards autocracy is a reminder that the only plausible long-term solution to kleptocracy is for rich countries to stop enabling it. If Westerners started living up to their professed values, and made it impossible for crooks to buy property and launder money in the West, it would reduce the appeal of being one.

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A warning from the Gilded Age & an ‘end’ to the Khodorkovsky saga

Oliver Bullough — Wed, 29 Oct 2025 13:00:00 +0000

I read a lot of history books and often find myself wondering about how current events will be interpreted by future historians. I appreciate that some people might see this as an overly optimistic practice (“get real, loser, there won’t even be historians in the future, let alone ones able or willing to objectively interpret the past” etc) but I still find it valuable as a way to create a sense of perspective that can otherwise be hard to find.

So, what will historians make of the latest developments in the United States? On Thursday, the government sanctioned Russia’s two most significant oil companies, in what threatens to be a massive blow to the financial underpinning of a key geopolitical adversary. On Friday, however, the government pardoned Changpeng Zhao, a crypto tycoon who two years ago pleaded guilty to, among many other things, facilitating sanctions busting by Iran, also a key geopolitical adversary.

How do you interpret that contradiction, or the fact that the US government is currently not paying its employees, while spending hundreds of millions of dollars, albeit privately raised, on a new ballroom? This could provide material for a hundred newsletters, and no doubt has already done, but I think there is value in asking whether the sole consistent factor here is inconsistency, and whether that itself is significant.

This is what happens when individual people make decisions without oversight, scrutiny or process and, although there may be some value in rapid decision-making, it also makes it far more likely that the decisions reached will be illogical, inconsistent and corrupt. I have been reading a lot recently about the last time inequality was as high as it is now, which was the time before World War One, a time that Americans call the “Gilded Age” and Brits call the Edwardian period. That too was a time of conflicts, inconsistency and excess, when plutocrats built ludicrous houses for themselves, and awarded themselves vast pay deals, when politicians got assassinated and political movements appeared and disappeared with dizzying speed.

I try to be optimistic, because there’s no sense in being otherwise, but the parallel is worrying. After all, the period before World War I all ended with World War I. If I were a plutocrat, I would be working very hard to steer the horse in another direction, away from disaster, rather than spurring it on ever faster.

Restitution from Russia?

But look, like a refugee from a different galaxy, here comes news of what should be the end of the long-running legal challenge brought by shareholders in the ex-oil company Yukos against the Kremlin’s expropriation of their assets. The Kremlin lost, and now the shareholders can seek to claim tens of billions of dollars from state assets worldwide. This saga sort of began 22 years ago when the Russian authorities arrested the country’s richest man, Mikhail Khodorkovsky, prosecuted him, and imposed such vast back tax bills that it could auction off his assets in a process that – funnily enough – was won by a state oil company run by a close ally of Vladimir Putin. It was an early sign of the kind of country Putin was building: kleptocratic, authoritarian, centralised, ruthless, and deeply stupid.

But the real beginning of the story was a decade earlier, when President Boris Yeltsin, attempting to build a different kind of Russia, one which followed international norms, signed the Energy Charter Treaty, an agreement designed to protect foreign investors’ stakes in national oil and gas industries.

The primary shareholders of Yukos were Russian but, like any competent global oligarch, they structured their ownership via multiple offshore entities so – when their company was taken away – they sued. And now, they have won in a process that is a memorial to the 1990s, and the odd alternate reality when globalisation was widely considered a good thing.

Obviously, Russia won’t abide by the judgement on its own territory, but the Yukos shareholders will continue their battles for various assets owned by Russia, such as this plot of land in London and these vodka brand names. “Real justice requires successful enforcement, so we will now focus all our efforts on enforcing against Russian state assets worldwide until every penny of the $65+ billion awards has been paid,” said Tim Osborne, who heads the shareholders’ company, which is called GML.

In that effort, however, he may well have competition. There is 210 billion euros of Russian state money frozen in the European Union, mostly in Belgium, and the EU is inching closer to using it to help Ukraine. The universe in which Russia happily deposited its assets in Western countries now feels like an alternative reality – one that historians will spend a lot of time dissecting.

Making criminals pay

International arbitration is a tricky game to play, however, or so the owners of P&ID may be feeling. In a complex (and, let’s be honest, rather imaginative) attempt to swipe a lot of Nigeria’s money, this small offshore company obtained a gas processing contract in 2010. Neither side did anything to fulfil the contract, then P&ID sued Nigeria and won a giant compensation award, the size of which has been growing larger still with the interest owed.

It is a case rife with allegations of corruption, professional misconduct and more, and mercifully the initial judgement in favour of P&ID was overturned. Last week, a court ruled that P&ID will have to pay the vast legal costs in sterling, rather than in naira, which will help Nigeria to avoid missing out on the advantageous exchange rate.

To say P&ID’s British lawyers have questions to answer is to understate how serious the allegations against them are, but regulators have so far done nothing. That is a very bad reflection on Britain’s ongoing facilitation of kleptocracy, and the state of its regulators.

Britain, in common with many other countries, has a very fragmented system of anti-money laundering regulation, so it is potentially good news that the government has proposed to combine many of the existing 23 regulators into “a small number” of bodies. Hopefully, this will mean the regulators are better funded, more motivated, and more willing to anger potentially powerful vested interests by actually investigating financial crime. “It is crucial that existing regulators do not take their foot off the pedal while we await legislation which could risk things getting a lot worse before getting better,” said Sue Hawley, of Spotlight on Corruption.

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A record Bitcoin haul & crypto comes to the Pitcairn Islands

Oliver Bullough — Wed, 22 Oct 2025 13:00:00 +0000

A couple of weeks ago I wrote about the U.K.’s seizure of 69,000 bitcoins (that’s worth around $7.7 billion) from a Chinese fraudster, and gave the impression it was a pretty big deal. But then, rather in the manner of Crocodile Dundee and knives, the United States revealed what it was packing.

“The Justice Department’s National Security Division [filed] a civil forfeiture complaint against approximately 127,271 Bitcoin, currently worth approximately $15 billion,” the DoJ announced last week. Now that really is a big deal (it’s not far off the total BP paid to settle charges over the Deepwater Horizon oil spill in the Gulf of Mexico). There can only ever be 21 million bitcoins in existence, so this seizure accounts for more than one in 200 of them.

The seizure was part of a case against Chen Zhi, a Cambodian businessman charged with being behind some of the most appalling forced-labour fraud compounds in Southeast Asia. Every aspect of the alleged scheme, from its targeting of vulnerable people in Western countries, to its reliance on trafficked labourers, is foul on its own but cumulatively, it’s beyond dreadful.

The money laundering techniques were complex and multi-jurisdictional, and the profits were spent on the usual expensive trash: “watches, yachts, private jets, vacation homes, high-end collectables, and rare artwork, including a Picasso painting purchased through an auction house in New York City”.

And of course there were shell companies in the British Virgin Islands and properties in London, because there are always shell companies in the British Virgin Islands and properties in London: a £12 million mansion near Primrose Hill; a £100 million office building in the City; plus various flats in the Centre Point building, and others in Nine Elms, a newly-built neighbourhood where many of the off-plan apartments went to cash purchasers from the Far East.

(Nine Elms is also, incidentally, home to the new U.S. embassy and a few years ago I did a talk for staffers interested in financial crime and one asked why, if there was so much money being laundered in London, none of it was visible. I drew his attention to the view from the window.)

The U.S. government earlier this year said it will place any bitcoin it seizes into a strategic reserve. I suppose a crypto reserve sort of makes as much sense as a gold reserve, at least until people lose interest in crypto and/or the power goes off. But there is a problem with the basic idea here: these bitcoins don’t belong to the United States. Assuming that the criminal complaints are proven, then this money is the fruit of crimes committed against millions of victims, and should be returned to them, whether in the form of bitcoin or whatever, not stashed away in Washington.

Some commentators have said cryptocurrencies help fight financial crime. In a blog, Elliptic, a blockchain analytics company, argued that “blockchain technology enables comprehensive visibility into financial flows, empowering all ecosystem participants to play a crucial role in identifying and reducing illicit funds.” But I don’t think that’s the message I take from this.

If the two biggest asset seizures of all time have come one after the other in the form of bitcoin, I think the important question to ask is “why do criminals have so much of their wealth in cryptocurrencies?” If crypto is helping baddies to hide their money more than it’s helping goodies to find it, then it’s more of a problem than it is a solution.

The Pitcairn crypto plan

Thanks to an Australian reader for tipping me off to an odd situation in the Pitcairn Islands, the only British Overseas Territory (BOT) in the Pacific, and the smallest territory in the world by population. Pitcairn has fewer than 50 inhabitants and is extraordinarily remote so unlike most BOTs – the Cayman Islands, the BVI, Gibraltar, Anguilla, etc – it has never developed an offshore financial services industry.

Anyway, it seems that in January 2020, Justin Sun – the Chinese-born billionaire head of the crypto giant TRON; prime minister of Liberland; first Kittitian in Space; former Grenadian ambassador extraordinary and plenipotentiary to the World Trade Organisation; eater of a $6.24 million banana; and early investor in Donald Trump’s crypto company – explored the possibility of turning Pitcairn into a crypto haven. According to the minutes of the meeting with the island’s council, three of Sun’s representatives were there on a friend-making mission: “TRON is looking to partner with a BOT to work together to craft regulations etc to help make crypto currency more mainstream.”

There was “a lot of community interest” among the locals for carving up this unexpected cash cow, but fate intervened in the form of a killjoy governor, who represents the U.K. in these parts. “TRON will not be permitted to establish bitcoin/crypto currency”.

According to one academic’s assessment of things, “a company with such a variable track record was never going to be afforded a foothold in the territory.” And, generally speaking, that should have been the end of the matter, leaving us with nothing more than a ghostly alternative timeline in which Pitcairn is a crypto hub (or, perhaps, a 21^st century version of Nauru) and its few-dozen residents are multi-billionaires.

None of this has been confirmed by Tron, so I only have the Pitcairn administration’s documents to go on but it appears that the company did not in fact go away quietly. Instead, in order to “garner favour”, it began to provide solar panels to Pitcairn residents. An attempt by the governor to stop this collapsed, given that everyone really wanted them, and by July 2023, the council’s meeting minutes noted: “we all have solar units donated from TRON on our roofs”.

My Australian interlocutor informs me that Pitcairn residents are unsurprisingly now super-enthusiastic about Tron for having provided them with free electricity, though loath to publicise it. This year Tron advertised for a Project Director (Pitcairn Islands Development) to lead “a humanitarian infrastructure development project aimed at improving the medical and accommodation conditions of 35 indigenous fishermen residing on Pitcairn Island", and is now looking for a “Legal Counsel (Pitcairn Islands Development)”.

Something’s happening here and I don’t know what it is, but if I worked for the British government I’d be trying to figure it out. Justin Sun’s stated philosophy is underpinned by the libertarian creed of “no forced obligations, no taxes, and no mandates”. It would be a challenging development if, now that he’s provided Pitcairn with free power, he managed to bring the islanders around to that point of view.

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Who should profit from crypto?

Oliver Bullough — Wed, 15 Oct 2025 12:57:15 +0000

It’s always all about the money, and never more so than when talking about cryptocurrencies. They're touted as being about liberation, but really they’re about taking our revenues and redistributing them to billionaires.

Governments have sought to control money distribution ever since there have been governments. There are entire Anglo-Saxon kings (shout out to King Æthelweard) whose names we know only because of coins dug up centuries later by metal detectorists.

It would be nice to think this was because rulers were concerned about spreading prosperity by ensuring a reliable currency, and I’m sure that’s partly true. But the underlying reason has always been that coining/printing money is incredibly profitable. In very crude (and slightly misleading) terms: printing a $100 bill costs around 10 cents; it sells for $100; so that’s $99.90 in profit for the government right there.

Anyway, this was always one of the (if not the only?) interesting things about cryptocurrencies like Bitcoin: by taking the power to issue money away from countries, governments would lose the ability to profit from our need for a means of distribution and exchange, and citizens would gain it for themselves. So it’s not surprising that governments want to stop that happening.

Last week, Uganda became the latest country to launch a Central Bank Digital Currency (CBDC), which will use the same kind of blockchain technology that underpins Bitcoin to create a mobile-first version of the country’s shilling, and thus attempt to negate the appeal of crypto. Perhaps more importantly India, which leads the world in crypto adoption according to some measures, plans to do the same.

“This will only make it easier to transact. It will also reduce paper consumption and will be faster to transact than the banking system. But it will also have traceability,” said the Indian Commerce and Industry Minister.

For most people in Western countries, the replacement of cash money by CBDCs would make very little difference because the vast majority of transactions are done electronically already; but for criminals, it would be disastrous. Accustomed to being able to use cash in huge quantities to hide their transactions, cartels, traffickers and others would have to invent new ways to find anonymity. (Inevitably, they’ll find it, but it will be more expensive, thus making their crimes less profitable.)

The European Central Bank is moving forward with its own plans to introduce a digital euro, and Piero Cipollone, a member of the ECB’s executive board, gave this fascinating interview last week about what that would look like (I think what he’s describing looks really good, for what it’s worth). A key insight is that, as electronic payment methods have spread, Europeans have become ever-more reliant on foreigners for processing transactions. “It … makes us vulnerable: we depend on others for our money and this can be weaponised against us. Ten years ago we weren’t facing this problem, because cash was king,” he said.

He called the payment processors that dominate transactions “international”, but in reality they’re American. Which brings us to a really interesting exception to the general global movement towards CBDCs: in the U.S., President Donald Trump has ruled the idea out completely, because it would “threaten the stability of the financial system, individual privacy, and the sovereignty of the United States”.

I think concerns about CBDCs’ impact on privacy are very overstated, considering most of us are already giving away ample data about our financial lives to banks, Apple, Paypal, and whomever, for them to do with what they wish, and it is particularly odd that the White House is stopping the Federal Reserve from issuing a digital dollar on privacy grounds while encouraging private companies to do so in the form of stablecoins like Tether’s USDT.

“The difference between a CBDC and a stablecoin like USDT is simple,” said Tether CEO Paolo Ardoino last week. “One belongs to the people. The other belongs to the state.”

That is obviously nonsense. Leaving aside the facile distinction between “people” and “state”, the idea that a digital dollar run by a democratically-overseen Central Bank like the Federal Reserve would somehow be less of the people than one run by a private company based in a foreign country whose president boasts of being a dictator (as El Salvador’s Nayib Bukele has done) is so idiotic it makes my brain hurt.

As so often with Donald Trump’s White House, this is all about the money and who gets it. The profits from issuing currency are called seigniorage, an old French term meaning that which belongs to the seignior or lord. By getting the Fed out of the CBDC business, and instead encouraging private companies to issue stablecoins, the White House is just redirecting seigniorage from the budget towards political allies, such as Trump’s own children. To be honest, I’m sure good old King Æthelweard did the same thing back in ninth century England, but you would have hoped that, 1,200 years later, we might have moved on a bit.

How much money are we talking about? Well, at the end of the month we’ll learn how much Tether made in profit in the third quarter. My money is on it exceeding its already record-breaking $4.9 billion haul from Q2. Its smaller rival Circle meanwhile is predicted to make revenues of more than $6 billion a year by 2028. Any Americans reading this: if the Federal Reserve had issued a CBDC instead of letting private companies do it, that money would be yours for spending on public services. Instead it’s being routed into right-wing media, political donations and the pockets of well-connected billionaires.

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A tale of two Bitcoin billionaires

Oliver Bullough — Wed, 08 Oct 2025 12:53:30 +0000

There have been some pretty chunky fines imposed by U.S. authorities for money laundering offences over the years. HSBC paid out $1.9 billion in 2012 for moving cash for Mexican mobsters; Goldman Sachs settled for $2.9 billion after being charged with helping kleptocrats loot a Malaysian sovereign wealth fund; and Danske Bank had to cough up $2 billion for moving vast sums for corrupt ex-Soviet officials.

I mention these amounts to put into perspective quite how ginormous the confiscation order secured last week by London’s Metropolitan Police against Zhimin Qian was. She could have paid all the fines imposed for those iconic acts of financial skulduggery in full, and still have had enough left over to buy the most expensive home ever sold, splash out on the most expensive car ever bought, and have a few millions left over for spending money. Before her wealth was snatched away, her net worth matched that of Donald Trump, who’s done pretty well himself over the last, hmmm, nine months or so.

“Between 2014–2017, Qian orchestrated a large-scale fraud in China through defrauding over 128,000 victims and went on to store the illegally obtained funds in Bitcoin assets,” the Met said. She fled to the U.K., where she was arrested last year, and her devices containing the keys to access her 61,000 bitcoins were seized.

There is a little bit of an asterisk next to the size of the seizure, however, since the bitcoins weren’t worth nearly as much when she bought them with stolen money as they are now. At the end of 2018, the year when the inquiry into her crime was launched, her bitcoins were worth around $228.5 million. That is obviously still by any standards a lot to steal but the cryptocurrency has had a wild ride since then, and her haul is now worth $7.24 billion and counting.

Qian had promised to triple the investments of the people she defrauded, but she actually increased them thirty-fold by stealing the cash and sticking it in bitcoin.

This episode raises some very interesting issues. What happens to the money? Obviously, her victims should get their money back, but what return should they get: just a standard interest rate, which is better than the nothing they have at the moment; the 300 percent she promised them, which would in ordinary times be awesome; or a proportionate share of this incredibly successful crypto-investment? If I was in the U.K. government, I would be arguing for the first option, but if I was in the Chinese government, I’d be aiming for the last.

Western law enforcement agencies normally struggle to get any kind of cooperation from their Chinese counterparts, but this case appears to be an exception. “Through a meticulous investigation and unprecedented cooperation with Chinese law enforcement, we were able to obtain compelling evidence of the criminal origins of the cryptoassets,” stated Will Lyne, head of the Met’s Economic and Cybercrime Command, which is something I have never heard a senior copper say before.

Could this be the prelude to an unprecedented thawing in relations between the U.K. and China, and the dawning of a new appreciation, nay a respect, for the rule of law in Beijing? Or could it just be that Xi Jinping’s people want a chunk of that $7.24 billion? The jury’s out. And it will remain out until those pesky jurors learn to do what they’re bloody well told.

There are some pretty odd, if compelling, details in this whole affair. “Zhimin Qian dreamt that the Dalai Lama would anoint her a reincarnated goddess,” reported the FT, “and that she would go on to become the Queen of Liberland, an unrecognised micronation on the Danube, where she would build the biggest Buddhist temple in Europe”. Qian travelled to the U.K. with a passport issued by the Caribbean nation of St Kitts and Nevis, which she applied for under the false name of Yadi Zhang.

St Kitts pioneered the whole “citizenship by investment” idea in partnership with Henley & Partners, and has done very well from it, as is abundantly obvious if you visit this extremely beautiful country. It may, however, be time for the rest of the world to start wondering why we are quite so happy to offer its “citizens” visa-free travel if this is the kind of person it sells passports to.

Another citizen of St Kitts and Nevis is the blockchain billionaire Justin Sun, who in August became the first Kittitian to sort of go into space. He travelled just beyond the official boundary on one of Jeff Bezos’ New Shepard rockets, which are so ludicrously appropriate in their phallicness that each trip is almost performance art.

Sun’s involvement in libertarian fever-dream Liberland, unlike that of fellow Kittitian Zhimin Qian, is no mere fantasy. He has been elected prime minister, and says the microstate “is a manifestation of a political philosophy that champions liberty, minimal government intervention, and individual autonomy”. Sun, notoriously, was one of the attendees at a private dinner hosted by Donald Trump in May for the top investors in his meme coin $TRUMP. The dinner was the culmination of Sun’s transformation from a fraudster charged by the Securities and Exchange Commission to a celebrated business associate of the U.S. president. Sun runs the TRON blockchain, which was home to more than half of all illicit crypto activity last year, according to TRM labs. To be fair, if I was in charge of that kind of business, I suspect that I would be in favour of “minimal government intervention” too.

The contrast between Sun’s fate and that of Qian couldn’t be more striking. The former, however shady his business dealings, gets to dine at the White House, while the latter is scheduled to be sentenced in a British court next month. If only Qian had invested in Trump’s meme coin?

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Derailing the Kleptocrats’ Gravy Train

Oliver Bullough — Wed, 01 Oct 2025 13:29:34 +0000

Last week, I went to Montserrat on a research trip, the fruits of which I may one day divulge to you, if indeed there ever are any. It is a small British island in the Caribbean with the unusual distinction of being an ex-tax haven.

I am fascinated by the dynamics of how small jurisdictions decide to monetise their sovereignty in an age of globalised money flows. Most recently this has involved places like Dubai, Ireland and South Dakota, but back in the 1970s and 80s, it was a process centred on islands in the Caribbean that were ideally positioned to help people from both North and South America dodge taxes and launder money.

”By most accounts, it was a stunningly sleazy climate in which to operate”, it says in this fun article on the cricket entrepreneur and convicted fraudster Allen Stanford, whose huge Ponzi scheme started life in Montserrat. “The vast majority of the Montserrat instabanks existed only on paper; their owners scarcely if ever visited the island. Scores of these banks would later be probed by British and U.S. authorities. One, Zurich Overseas Bank, whose owners would be indicted for fraud in Detroit, operated out of the Chez Nous tavern in the Montserrat town of Plymouth”

Of course it takes more than a few investigations to get a British overseas territory out of the sleaze business – for evidence, look no further than the British Virgin Islands, which are once again under “increased scrutiny” after missing a deadline this summer to institute more corporate transparency. And in Montserrat’s case, it took a volcano. In 1995, the Soufriere Hills awoke after a long period of dormancy and, over the next couple of years, obliterated Plymouth, (you can see some photos I took on my Instagram of what it looks like now) which made it impossible to maintain any kind of life there at all, let alone a business.

Montserrat is a beautiful island, with turtles burying eggs on its beaches, hummingbirds dipping into flowers, and odd creatures called agoutis zooming about, but it’s suffered terribly. Most of the population has left, and half the island is still an exclusion zone. It would, in short, be nice if there were a better way to get jurisdictions out of the money laundering game than blowing them up. There is, of course, another way to do it, with no volcanoes involved, but to find out about that and to judge for yourself whether it’s better or worse than what happened to Montserrat, you’ll need to buy my new book, “Everybody Loves Our Dollars”, which is coming out in January (available for pre-order now).

THE CROOKED POLITICIANS’ CLUB

That’s not say that blowing things up is necessarily bad, particularly if you play this gloriously old-school computer game, in which you are an anti-corruption activist seeking evidence against the kleptocratic rulers of The Republic of Congo by bouncing about, shooting at them, and eventually gathering evidence that they’re rigging elections. I am not a skilled gamer, but I do like a 2D shoot-‘em-up.

Denis Sassou Nguesso has, but for a violent five-year interruption, been president of Congo (often called “Congo-Brazzaville”, to distinguish it from its neighbour, the Democratic Republic of Congo) since 1979. He has been accused of establishing one of the world’s most egregious kleptocracies, with family members becoming vastly wealthy thanks to corruption around the nation’s oil reserves, and investing some of these proceeds in France and the United States.

Anyway, he’s seeking re-election next year, which is likely to be a formality, but – as the game shows – anti-corruption activists from the Sassoufit Collective are not giving up yet. “Congo is heading toward a future where incompetence will replace greed, where amateurism will replace bad faith, and where the state risks becoming a mere family patrimony,” it said in August. Sassou Nguesso is no longer as welcome in Western capitals as he once was. Fortunately, he has found new friends in Vladimir Putin and Xi Jinping, so that’s nice.

Sassoufit Collective’s founder, Andrea Ngombet Malewa, has previously warned his compatriots against allying too closely with China, which he argues is an accelerator of kleptocracy. “One of the most alarming results of Sino-Congolese cooperation in recent years has been the establishment of a banking structure that allows money to move across international borders without the standard accountability and transparency measures associated with financial institutions based in the democratic world,” he wrote in 2023. Of course, that was before the US crypto-rush. There are now quite a lot of blockchain-enabled options for kleptocrats seeking financial solutions without “standard accountability and transparency measures”, and more appear all the time.

President Sassou Nguesso’s exclusion from Europe and resulting pivot towards China is the fruit of hard work by the excellent people of Sherpa, a French anti-kleptocracy group. For years, they insisted that French prosecutors should investigate foreign politicians’ property ownership in France. The prosecutors did not want to, but were eventually given no choice. All kinds of delicious carnage ensued, featuring the leaders of Congo, Gabon and Equatorial Guinea. Piqued, the politicians flounced off to Beijing and Moscow.

That all looked like a final convulsion for the unlovely Francafrique policy, in which politicians in Paris and various African autocracies propped each other up with money, diplomacy and covert operations. But then last week Nicolas Sarkozy was jailed for five years for supposedly soliciting funds from Libya’s Muammar Gadaffi, in what felt like a repeat of the old tricks French politicians got up to, so perhaps those ancient friendships persist after all.

Incidentally, Sherpa joined the Sarkozy case as a civil party more than a decade ago and pushed for the ex-president’s prosecution, showing a template for what civic-minded lawyers are able to achieve. “This case is not limited to one French election. It reveals how certain political and economic elites have deliberately turned a blind eye to the predatory practices of authoritarian regimes and actively participated in the misappropriation of funds,” the NGO said in a statement.

On the other side of the channel, however, there is a different legal tradition and Sassou Nguesso appointed a London law firm to push back against allegations of kleptocracy. That was almost two decades ago, and perhaps lawyers would be more circumspect about who they choose to represent now. Or perhaps not, as unscrupulous law firms continue to use libel laws to help wealthy criminals evade scrutiny. So well done to the Tax Policy Associates for working hard to expose what’s sadly still going on.

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The Tehran-Washington crypto connection

Oliver Bullough — Wed, 24 Sep 2025 13:34:11 +0000

There is a saying that the best way to make money during a gold rush is to sell picks and shovels. The worst way, presumably, would be to run a government taskforce drafting regulations for the retailers of picks and shovels.

Perhaps relatedly, Bo Hines – who from January to August was the executive director of President Donald Trump’s council of advisors on digital assets – has been hired to run the US operations of Tether, the company behind USDT, the world’s largest stablecoin. USDT is a cryptocurrency that functions a little like a pick/shovel does during a gold rush. Now Tether will release a new U.S.-based stablecoin called USAT.

Anyone alarmed by the implications of Hines changing sides can be reassured. There is no conflict of interest, because Hines himself said so: “I stepped down from my roles touching anything related to crypto in the White House and I felt like this was a fantastic opportunity to jump into the private sector.”

It must have smarted for Hines to be languishing in the public sector drafting regulations for the crypto rush, while in the private sector people – including family members of senior administration officials – were making billions of dollars. USDT, the stablecoin Tether has created for the US market, is being marketed in partnership with Cantor Fitzgerald, which is run by Brandon Lutnick, son of Howard Lutnick, the U.S. Secretary of Commerce, so that too is being kept in the family.

In order to guarantee that Tether’s tokens will always be worth the same as a dollar, it owns a lot of US debt: some $127 billion worth at the end of July, which works out basically as $127 billion of free money for the U.S. government.

“Tether is by far and away the most important private-public partnership the U.S. government has, we’re buying more treasuries than anyone else in the private sector,” said Hines, which is an interesting way of defining ‘important’. Once upon a time, the major defence contractors would have ranked top of the list, but now it’s a company that buys debt so Trump can keep cutting taxes for his friends.

This is not to say the U.S. government isn’t concerned about crypto. The Office of Foreign Assets Control has sanctioned Iranian nationals, Alireza Derakhshan and Arash Estaki Alivand, and a network of foreign enablers, who were selling Iran’s oil to raise money for its armed forces via the medium of cryptocurrency.

“Iranian entities rely on shadow banking networks to evade sanctions and move millions through the international financial system,” said John Hurley, Under Secretary of the Treasury for Terrorism and Financial Intelligence. But you’ll scour that press release and related documents in vain for information about what specific cryptocurrency was being used by the Iranians to finance the sale of hundreds of millions of dollars worth of oil. Luckily, you can turn to this bit of analysis from Elliptic: “Alivand’s addresses have received a total of $300 million, while Derakhshan’s have received $442 million, mostly in the USDT stablecoin”.

Oh.

So, Iran sells oil for USDT; which creates demand for Tether; which buys US government debt. Cut out the middleman and essentially, thanks to the magic of the blockchain, the Iranian and US governments are in business with each other.

It seems a bit weird that the United States so enthusiastically prints $100 bills even though the only significant market for them is organised criminals, who do far more damage than the U.S. makes in profits from the trade. And it’s very disturbing that the government IS making the same mistake with cryptocurrencies.

TUVALU AHOY!

One of the annoying things about financial skulduggery is that new techniques keep getting invented all the time, even as the old techniques remain as useful as ever. If crypto is offshore’s newest manifestation, then flags of convenience are probably its oldest.

Ships have been flying other countries’ flags as a ruse de guerre for centuries, but it only really became a formalised business technique in the 1920s when American vessels reflagged as Panamanian so they could sell alcohol during prohibition. But as with everything offshore, a trick invented for naughty rich folks – in this case so they could drink cocktails without legal consequences – has morphed into a tool for criminals and scumbags to make life worse for everyone.

Flags of convenience are almost ludicrously artificial, even by the standards of other offshore trickery, in that registries often have only the sketchiest relationship with the country they’re nominally part of. The Palau, Marshallese and Liberian ship registries are all in the United States (as was Panama’s, until recently); St Kitts and Nevis’ is in the UK; Tuvalu’s is in Singapore; Togo’s is in Lebanon, etc. Small countries are basically just hiring out their sovereignty so foreigners can do dodgy stuff with boats.

The most recent manifestation of this is in Russia’s shadow fleet of ageing oil tankers, some of which lost their Liberian flags and re-registered under the flag of Gabon (effectively a private company based in the UAE), as they sought to continue evading Western sanctions while they sail through the English Channel. “The ease with which vessels can obtain flags without scrutiny, avoid ownership transparency and escape enforcement actions has created the conditions for an entire parallel shipping ecosystem,” notes the Royal United Services Institute (RUSI) in this fascinating paper.

Western countries have sought to do something about this, and some larger registries have become more compliant under pressure, but that has just encouraged new countries to hire out their flags to all-comers, including “Cameroon, Comoros, Gambia, Honduras, Mongolia, São Tomé and Príncipe, Sierra Leone and Tanzania”. RUSI calls for states issuing flags of convenience to be checked by the Financial Action Task Force, which raises the prospect of blacklisting for rogue actors.

I am not as a rule a big fan of the FATF (or indeed of how it goes about blacklisting countries), but the situation has got so bad, that perhaps it is the only body that could now make a difference and head off consequences that are almost impossible to overestimate. “Without such action, the shadow fleet will continue to entrench itself as a parallel system that threatens financial security, undermines legal norms, poses immeasurable environmental risk and raises the threat of geopolitical escalation,” RUSI’s paper concludes.

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Russian sanction-dodgers, Chinese gangsters & Mexican cartels

Oliver Bullough — Wed, 17 Sep 2025 12:51:48 +0000

The full-scale invasion of Ukraine happened more than three years ago, which means full-scale Western sanctions on Russia did too. Concurrently, Russians have had just as long to figure out ways to dodge those sanctions, and I fear Western countries are being a bit too slow in realising quite how good they’re getting at it.

So, props to Transparency International’s exiled Russian chapter for this excellent report on the new laundromat, which has grown out of the Garantex crypto exchange that was shut down in April after a multi-year, multi-country effort. There is something grimly depressing, if inevitable, about the fact that within days of Garantex being snuffed out, it had been reborn.

“It reemerged under new names, such as MKAN Coin, Grinex, and Exved, morphing into a decentralised laundering system sustained by technical obfuscation and governments’ tolerance,” TI-Russia notes. “Entities tied to Garantex continue operating across UAE, Brazil, Kyrgyzstan, Spain, Thailand, Georgia, Hong Kong, and Russia.”

Powered by the encrypted messaging app Telegram, the skilled launderers behind Garantex’s successors are learning to mitigate their vulnerabilities, rather like bacteria evolving in response to antibiotics. And they have found helpful new hosts, particularly in Kyrgyzstan.

The rouble-pegged stablecoin A7A5 is, according to Chainalysis, operational largely in office hours, which suggests it is operating more like a shadow bank than the kind of cryptocurrencies beloved of speculators in the West. By the end of July, more than a billion dollars’ worth of transactions were moving through A7A5 every day, with it being used as a bridge between roubles and the dollar-backed cryptocurrency Tether, adding a layer of obfuscation that helps to obscure connections between Russian sanctions-busters and the big crypto operators.

There is nothing too surprising about this: money launderers have nimbly adjusted to limits on their activities ever since there have been attempts to limit those activities. In many respects, the way that Garantex’s successors have spread across jurisdictions, taking advantage of mismatches between legislation and law enforcement capabilities, is just a digital-age copy of the way the drug cartels’ bankers operated in the Caribbean in the 1980s.

Nonetheless, it is depressing that Western governments appear not to be learning as rapidly as their adversaries, and instead are relying on the blunt instrument of sanctions, rather than engaging more proactively with the causes of the problem. This is not to say that sanctions do not have their uses. They are obviously useful as a first step, and clearly very irritating to kleptocrats, otherwise they wouldn’t fight so hard to overturn them.

For instance, Viktor Yanukovych, the corrupt former president of Ukraine whose disastrous tenure sowed so many of the problems that are causing death and misery today, has been fighting to cancel European Union sanctions against him for more than a decade. He’s now failed to have the courts overturn those sanctions, as has his son, which is wonderful. Yanukovych always seemed to have a tenuous grasp on reality, and this is nowhere more in evidence than in the apparent plot to reinstall him as president of Ukraine after the Russian full-scale invasion, which is detailed in the court’s judgement. The idea that anyone in Ukraine wanted him back goes way past self-confidence and deep into the territory of profound delusion. A weird but true aside: Yanukovych’s press secretary once bit me on the arm to prevent me asking him a question about a ludicrous inconsistency in a speech he’d just made; it was very painful, and very effective.

CHINESE GANGS & MEXICAN CARTELS

Much of the early structures used by money launderers were created in the 1950s and 1960s to serve wealthy people looking to dodge the era’s strict capital controls and high taxes. Just as today, it is the desire of wealthy Chinese people to evade capital controls that drives innovation and growth in money laundering methods.

“Chinese money laundering networks are global and pervasive, and they must be dismantled,” said FinCEN Director Andrea Gacki. “These networks launder proceeds for Mexico-based drug cartels and are involved in other significant, underground money movement schemes within the United States and around the world.”

The core of the system is that Mexican cartels are earning huge amounts of cash dollars, which they are unable to pay into banks. So they hand them over to Chinese gangs, which in turn sell them to wealthy Chinese people looking to spend in the West. The circle is completed by the Chinese gangs shipping counterfeit goods, precursor chemicals or other things that the Mexicans need.

FinCEN has issued an advisory with guidance on what Chinese Money Laundering Networks look like, which makes very interesting reading, especially its long list of “red flags”, each one helpfully illustrated by an actual red flag. The trouble of course for the U.S. authorities is that most of the action happens outside their oversight.

With one exception: the White House could always seek to limit the printing of cash dollars that are the lifeblood of the whole system. At the very least, it could stop printing so many of the super-convenient $100 bills. But it’s not doing that. On the contrary, the value of dollars in circulation hit a new all-time high in July.

TAKING BACK ILL-GOTTEN GAINS

Among the curious folkways of British politics is that TV dramas have far more impact on political discussion than even the most considered bit of journalism. Misha Glenny’s book, McMafia, came out in 2008 and received excellent reviews for its forensic analysis of organised criminality. But it was only when a TV drama of the same name appeared a decade later that U.K. politicians woke up to London’s central role in laundering the world’s criminal wealth.

They nicknamed a new legislative proposal “the McMafia law”, and promised it would drive kleptocratic wealth out of London. Spoiler alert: life is not a TV drama, and there was no happy ending. Lawyers fought back, and the impact of the Unexplained Wealth Order was limited.

But, wait, what’s this? The Serious Fraud Office has used an Unexplained Wealth Order to confiscate a 1.1 million pound house! So there is life in the old law yet. Granted the target was not a kleptocrat, but a fraudster; the house was not in London, but in the Lake District; and 1.1 million pounds is a rounding error compared to the 100 billion pounds or so of criminal wealth estimated to pass through the UK financial system every year. But a win’s a win, and they deserve congratulations. “Unexplained wealth orders offer investigative opportunities to pursue assets on behalf of victims and taxpayers. This is our first successful use of this legislation and it certainly won’t be the last,” said Nick Ephgrave, Director of the Serious Fraud Office. Hooray for that.

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The Bulloughs of Kinloch Castle

Oliver Bullough — Wed, 10 Sep 2025 12:46:54 +0000

As you may have noticed, I’ve been away for a couple of weeks. I spent my days off in Scotland’s Inner Hebrides, in search of the legacy of the only famous person there has ever been with the same surname as me: Sir George Bullough, a late Victorian moustachioed flaneur who inherited a fortune and spent it hard on horses, yachts and the Isle of Rum.

He gifted the island a mausoleum and a castle that is architecturally foul even by late-Victorian standards (“nothing that a good fire and subsequent demolition couldn’t rectify”), but us Bulloughs have to take what we’re given, so I dragged the family off to have a look, even though we are – at least as far as I know – completely unrelated to him.

In its glory days, Kinloch Castle – which looks vaguely like a sandstone version of Shawshank prison reimagined by someone who’s read too much Walter Scott – was quite something. Sir George imported 250,000 tonnes of topsoil for the gardens, built heated greenhouses for his collections of hummingbirds, alligators and turtles, and installed one of Scotland’s first electricity generators. He paid his gardeners extra if they wore kilts, and built the laundry on the uninhabited north side of the island because his wife didn’t want anyone to see her knickers drying on the line.

Like the Titanic, the castle is a monument to the hubris of the European ruling classes in the years before World War One. Built at vast expense, it relied on a reserve of cheaply-paid labour that vanished with the arrival of hostilities, and – as with the European empires of the time – never recovered.

“There were only the boys left, of which I was one, to maintain the gardens and the greenhouses,” remembered a gardener in a passage quoted in a book on the Bulloughs. “The grapes, the peaches and the orchids vanished, gradually sliding into the wilderness of weeds and broken glass that marks their position today.”

Sir George and Lady Monica’s wealth never recovered either. In her old age, Lady Monica sold the island at a knock-down price to the Scottish government, which has let the castle slip into disrepair, and I can’t say I blame it.

This feels symbolic too. The decades after 1914 marked a collapse in wealth inequality, and a playboy’s crumbling mansion was an apt metaphor for how profligate that whole generation looked to those who came later.

However, the wheel keeps turning: wealth inequality started to grow once more in the 1970s, and is now – including, worryingly, in the United Kingdom – approaching previous heights. “At the top of the American economic summit, the richest of the nation’s rich now hold as large a wealth share as they did in the 1920s,” it says here.

This is bad news for democracy and risks sending us back to a future when those of us whose net worth does not include multiple commas have to live in an isolated hovel in a midgy, rainswept bay and wash oligarchs’ underwear. But bad news for democracy could be good news for Sir George’s folly. Kinloch Castle is on the market for 750,000 pounds, although its new owners are unlikely to be able to move in immediately. “It requires significant refurbishment to return it to full residential or hospitality use. Repair and redevelopment costs are likely to be in the region of approximately 10 million pounds or more,” the estate agent notes.

Having looked at it, and considering its isolated location, I would say 20 million is a more reasonable estimate but, whatever the cost, surely some of my readers have a few quid they can chuck at the one material legacy left to this world by a Bullough? And since you ask: yes, once you’ve patched the roof, restored the orchestrion and employed some decent chefs, I’d be more than willing to come and stay. The island is absolutely stunning. In buying Rum, if in nothing else, Sir George showed excellent taste.

A NEW AGE OF INEQUALITY

It is sadly easier to spot sell signals after a market has crashed. To his contemporaries, Sir George’s castle – along with the other extravagances of the Gilded Age – presumably looked like a perfectly reasonable thing to spend money on, rather than a symbol of excess and frivolity. I would challenge anyone, however, to look at Trojena and not think that it is a gigantic flashing stop sign for civilisation.

A proposed ski resort in Saudi Arabia, it is being built in mountains where there is almost no precipitation, so all the water must come from the ocean, which is at a distance of 200 km laterally and 2.6km vertically. Once the salt has been removed (at a vast cost in both money and carbon), the water is to be pumped uphill through a metre-diameter pipe, and then stored in an artificial lake, which will provide all the resort’s needs, including for the manufacture of the snow required for its 30km of runs. The 140 meter-deep lake requires three separate dams and will cost $4.7 billion to build, according to Italian company Webuild. Just filling it up will take two years of pumping.

“Webuild will also create the futuristic Bow, an architectural structure that will extend the surface of the lake beyond the front of the main dam. It will be shaped like the prow of a ship suspended over the valley, and will house a luxury hotel, as well as a residential area and a large central atrium, with accommodation and hospitality facilities,” the company stated.

This is part of the Neom project and, like all the other bits, looks like a snazzy futuristic vision in the architects’ renderings, when in fact it is a deranged climate-destroying hellscape, which even Mohammed bin Salman is struggling to afford. Trojena is supposed to be hosting the Asian Winter Games in 2029, but apparently Riyadh has been sounding out whether another city could step in so they can do it four years later.

My optimistic prediction is that, in a century’s time, regardless of whether Trojena ever hosts a skiing competition or not, someone will be looking at its ruins and making notes for a sarcastic newsletter about the excesses of this age of inequality. My pessimistic prediction is so depressing it doesn’t bear thinking about.

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Tax-dodging philanthropists & Whitewashing autocrats

Oliver Bullough — Wed, 20 Aug 2025 12:57:31 +0000

Philanthropist is a great word, deriving as it does from an ancient Greek term for “love of humankind”. In theory it could describe almost any decent person but, in practice, it is reserved for very rich people – Mackenzie Scott, Bill Gates, Roger Federer – who demonstrate that love by spending lots of money.

It is incredibly odd how much hate Gates gets, considering the volume of crucial medical research that is being funded by his foundation. And he has also pushed for other billionaires to give their wealth away, via 2010’s Giving Pledge that he made alongside Warren Buffett, but if you thought that meant our new breed of oligarchs was chucking money out the door faster than it came in, a new report has worrying news.

“Three quarters of the original U.S. Giving Pledgers who are still alive remain billionaires today, and they have collectively gotten far wealthier since they signed, while just eight of 22 deceased Pledgers fulfilled their pledges. What’s more, most of these contributions have gone to private foundations or donor-advised funds (DAFs), which can warehouse wealth for years without paying it out to working charities,” concluded the Institute for Policy Studies.

Mark Zuckerberg and Priscilla Chan, who signed the pledge, have seen their wealth increase by 4,000 percent since 2010, which – if nothing else – suggests they were not very good at giving money away even before their recent decision to close tuition-free schools they’ve been funding.

In this they are not alone: billionaire wealth is increasing globally, growing three times faster than the rate of inflation, while hundreds of millions of people live extremely precarious lives, and life expectancy has begun to fall even in some wealthy countries.

I don’t want to give the impression I am opposed to charitable giving by rich people. The Wellcome Trust (created by Henry Wellcome before World War Two) does incredible work, as do many other organisations founded by past tycoons. But I do think that the modern-day iteration of philanthropy gives an impression of generosity, which is almost always not matched in reality.

The most extreme example recently is that of Sam Bankman-Fried, who yakked on to anyone that would listen about effective altruism, a movement which is perhaps the perfect distillation of the neoliberal version of philanthropy, while running a gigantic fraud. But, even in cases of law-abiding tycoons, the impression of generosity takes the pressure off them to pay the taxes needed to support democratic societies.

The IFS says “instead of allowing the ultra-wealthy to park trillions for generations in family-controlled foundations and intermediaries such as donor-advised funds, we must strengthen the rules that currently allow them to use these vehicles for tax avoidance”, and I couldn’t agree more.

A lot of problems cannot be solved by just throwing money at them: hiring a nanny is not equivalent to being a parent; paying for a therapist is no replacement for being a friend; giving donations to organisations is not the same as being a citizen. I understand that this must be annoying for a billionaire to pay a huge amount of tax and then watch it being spent on something you don’t agree with, but that’s something we all have to put up with in a democracy. If you don’t like it, there are plenty of countries out there with other political systems you could try; or else, you can try to persuade people to vote for you. Of course, Zuckerberg did think about trying that, and you really should read about it in ‘Careless People’. It’s hilarious.

THE WHITE HOUSE ABANDONS HUMAN RIGHTS?

A couple of months ago, the foreign ministries of Russia and Belarus released their joint report on the “Human Rights Situation in Certain Countries”. Now I feel sure that all readers of this newsletter will have already perused this document’s 1,500-odd pages in depth, but just in case you haven’t, it’s basically a deeply weird attempt to insist that the world’s most pressing question remains World War Two, and therefore the worst problems occur in those countries that object to having been occupied by the Soviet Union.

As far as I can tell, Moscow started producing this report not because it cares about human rights (if it does, it has a strange way of showing it) but because it deeply objected to the fact the U.S. State Department had for decades published its own annual report accusing Russia of mistreating its own citizens, and the Kremlin wanted to get its own back. The difference between the two reports of course was that the American one was respected and authoritative and the Russia one was absurd.

Respected and authoritative that was until last week, when the 2024 US reports were published with many of the same flaws as the Russian ones have long had. “Entire categories of interest were removed. The Obama administration had previously put a strong focus on corruption, on the grounds that kleptocracy and autocracy are deeply linked,” noted Anne Applebaum. “The revisions also go much further than expected, dropping references to corruption, restrictions on free and fair elections, rights to a fair trial, and the harassment of human-rights organisations.”

Citizens of countries less fortunate than the United States had long relied on the State Department’s reports for support in their campaigns against their own governments, often against huge odds. This is just the latest example of the White House abandoning people who had previously depended on it.

AN EDUCATION IN SANCTIONS EVASION

While I’m talking about Russia, I recommend this article by Tom Keatinge on how universities are now teaching courses in sanctions evasion. Indeed, in one Moscow university, the course is compulsory for law students.

“The Kremlin views itself as being at economic war with the West, thus requiring a whole-of-society response including training future generations in the art of sanctions circumvention and new approaches to cross-border payments that avoid the US dollar and other western currencies. The counterparts of the troops being thrown into the meatgrinder in Eastern Ukraine are the businessmen, accountants and financiers learning these new tools,” Keatinge writes.

It is very frustrating to me that we in the West are not working to defend our values as seriously as people in Moscow are working to undermine them.

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