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Cash from organized crime ‘rescued’ banks during crisis: UN official

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The vast majority of an estimated $352 billion in proceeds of organized crime, mostly from the drug trade, was funneled through the global banking system during the financial crisis of the past two years, and in some cases, the money rescued banks from collapse, says the head of the UN Office on Drugs and Crime.

Antonio Maria Costa told the UK Observer that intelligence agencies and prosecutors alerted him 18 months ago to evidence that drug money was being “absorbed into the financial system.”

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“In many instances, the money from drugs was the only liquid investment capital,” Costa said. “In the second half of 2008, liquidity was the banking system’s main problem and hence liquid capital became an important factor.”

The Observer reports:

Some of the evidence put before his office indicated that gang money was used to save some banks from collapse when lending seized up, [Costa] said.

“Inter-bank loans were funded by money that originated from the drugs trade and other illegal activities… There were signs that some banks were rescued that way.” Costa declined to identify countries or banks that may have received any drugs money, saying that would be inappropriate because his office is supposed to address the problem, not apportion blame. But he said the money is now a part of the official system and had been effectively laundered.

Gangs are now believed to make most of their profits from the drugs trade and are estimated to be worth £352bn, the UN says. They have traditionally kept proceeds in cash or moved it offshore to hide it from the authorities. It is understood that evidence that drug money has flowed into banks came from officials in Britain, Switzerland, Italy and the US.

Read the complete Observer article here.

Costa has been head of the UN’s drug and crime office since 2002, and is known for his tough stance on illicit drugs, including marijuana. He recently warned that Africa is becoming a major drug hub, following an investigation into the crash of a Boeing 727 in Mali that had flown in from Venezuela carrying 10 tons of cocaine.


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‘The president isn’t above the law’: Supreme Court expected to rule on two key Trump cases on Thursday

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Can Donald Trump refuse to hand over his financial records to Congress and New York prosecutors simply because he is president of the United States? The Supreme Court will rule Thursday on two related cases to answer this, with potentially widespread political implications.

The decision by the nine justices could lift the veil on Trump's finances ahead of the November 3 election.

Unlike all of his predecessors since Richard Nixon in the 1970s, New York real estate mogul Trump refused to release his tax returns, despite promising to do so during his 2016 White House campaign.

Trump made his fortune a key component of that campaign, and his lack of transparency raises questions about his true worth and possible conflicts of interest.

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Australia offers safe haven to Hong Kongers, sparking China fury

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Australia offered pathways to permanent residency for thousands of people from Hong Kong on Thursday in response to China's crackdown on dissent, drawing a furious reply from Beijing.

Prime Minister Scott Morrison said his government was suspending its extradition agreement with the city and, in addition to extending the visas of 10,000 Hong Kongers already in the country, threw open the door to thousands more wanting to start a new life Down Under.

Morrison said the decisions were taken in response to China's imposition last week of a tough new security law in Hong Kong, which he said "constitutes a fundamental change of circumstances" for the semi-autonomous territory.

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‘Glee’ star Naya Rivera missing, feared drowned

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"Glee" star Naya Rivera is missing and feared drowned at a California lake, local officials said, with rescuers to continue a search for her on Thursday.

The Ventura County Sheriff's office earlier tweeted it was looking for a "possible drowning victim" at the lake, and said a dive team was being deployed to the area.

Rivera, 33, is best known for her role as high school cheerleader Santana Lopez in "Glee", the TV series that she starred in for six seasons.

She rented a boat on Wednesday to take her four-year-old son onto Lake Piru, northwest of Los Angeles, local media cited the County Sheriff as saying.

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