In “Rinsed: From Cartels to Crypto: How the Tech Industry Launders Money for the World's Most Terrifying Scammers” (Penguin Business), Jeff White asks, “What do you do when your sudden wealth comes from sources you can't acknowledge?” “You're faced with an unbearable dilemma,” he writes. “How can you enjoy huge sums of cash while hiding its origins?”
The answer is money laundering, and in Rinsed, White reveals how the symbiotic relationship between technology and money laundering brings criminals one step closer to capture: “Technologists have a remarkable habit of creating innovations that inadvertently possess the very kinds of properties that money launderers covet,” White writes.
In Rinsed, White identifies three stages in money laundering: placement in an existing financial system, layering where the money is mixed with legitimate cash, and finding new potential uses.
In Rinsed, White identifies three stages in money laundering, beginning with “placement” in the existing financial system. Penguin Books
“Money laundering is about changing that history,” White explains.
Technology has become a “rocket booster” for money laundering.
Numerous examples are cited of the ease with which funds can move, from the Nigerian “Yahoo Boys” (so-called for their use of the company's free email accounts) to digital platform Hydra – the “eBay” or “Amazon” of the dark web – that the explosion of cybercrime is making.
And it's getting more sophisticated, as the $625 million cryptocurrency theft from Singapore gaming company Sky Mavis in 2022 shows. “What made this case so sinister was that the technology used to launder the cryptocurrency was like a self-driving car: an autonomous mixer with no owner to control it,” White wrote.
“It was the perfect technocratic crime.”
Every development in digital technology creates new opportunities for fraudsters, especially when little up-front investment is required. As one police officer told White: “To distribute cocaine, you need to buy it from another smuggler and have some capital in reserve. How much is the capital in reserve for a scam?”
“Engineers have a remarkable habit of creating innovations that unintentionally have the exact kinds of properties that money launderers covet,” White writes.
“The product you are selling is nonsense. It's cheap, plentiful and infinite.”
In that respect, “Rinsed” predicts difficult days to come.
“There's an old saying that a rising tide floats all boats,” White adds. “This is usually couched in positive terms, but when it comes to money laundering, it paints a bleak picture. The more sophisticated the money launderers become, the more likely it is that crimes of all kinds will occur.”
