When Doing Business With the Cartels Went Completely Wrong

How exactly did one of the world’s biggest banks launder billions for cartels? Find out this insane story of corruption and greed in this video!

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Move That Dough
Mexican Cartels are giant corporations with a caveat. They’re dealing in illegal businesses. Huge, illegal businesses that generate massive amounts of income. We are essentially talking about billions of dollars a year. And things aren’t slowing down for these cartels. In fact, business is growing and it’s booming. Profits in recent years have been ever growing.

Method #1
Here’s a quick crash course on money laundering. There are plenty of different ways to launder money, but they essentially boil down to two ways. The first method is laundering money through a bank. The cartel will first deposit their money at a bank. Then, a process known as "layering" begins. The cartel will send the money through various wire transfers to a lot of different accounts.

Method #2
The second method is laundering the money through what’s called trade based laundering. This was a technique El Chapo’s cartel developed into an art form! The simplest way to do this is by buying easily sold high end items such as say, a Rolex or a gold bar, from a legitimate company in the US. Anything that’s more like a commodity, the better. They then would sell the item back in Mexico for pesos.

Corruption
So if it’s so tough to launder money, then how did the Cartels get so big and powerful?! Why isn’t Mexico putting a stop to all of that? One word. Corruption. There’s a lot of corruption in the Mexican government. As a famous saying goes, people are forced to either accept the bribe or face the consequences.

Bital Bank
Bital Bank was a bank used by the Sinaloa cartel, the one El Chapo ran. They’re still the most powerful cartel in the world. Well, they needed a lot of money laundered, and doing it through a bank was one of their ways. And Bital was the bank that El Chapo’s cartel picked. A lot of money was coming and going from Bital bank. And in case you guys didn’t know it, there were a lot of corrupt officials working at the bank.

El Chino
So all this went on for a long time. How did it ever all come crashing down for one of the biggest banks in the world? Enter Zhenli Ye Gon, or better known as El Chino in the Narco world. He’s a Chinese-Mexican businessman who ran a company in Mexico called Unimed. This was a wholesale pharmaceutical company that did business in Mexico.

Know Your Customer
Because a bank can get into big trouble whenever they aid illegal activities through money laundering, it’s in their best interest to get to know their customers. But HSBC never did that. It wasn’t only El Chino that had these money laundering issues. It was a bunch of other people that were doing money laundering all over the US. Investigators noticed a lot of shady criminal transactions throughout different areas of the US.

HSBC Logic
They decided to do business with illegal organizations just so they can pocket billions of dollars in profit. This allowed cartels to operate in Mexico and the US without impunity! When HSBC bought Bital bank, it’s our suspicion that they knew EXACTLY what they were buying. They knew that the cartels were a growing business and that that specific business would grow. So they basically bought up these accounts and decided to continue to do business with them.

Видео When Doing Business With the Cartels Went Completely Wrong канала Enterprises Explained