'Liberty Reserve' And Why Some Money Launderers Are "More Equal" Than Others

Tyler Durden's picture


Submitted by Michael Krieger of Liberty Blitzkrieg blog,

“All animals are equal, but some animals are more equal than others.”
 George Orwell’s Animal Farm

It’s been many, many years since I read George Orwell’s Animal Farm, but the message conveyed in it will remain with me forever.  The book is many things, but more than anything else, it is a portrayal and critique of human nature and the political systems that we create. For those that need a refresher, or have not read the book, here’s the basic plot.

There’s a farm headed by a Mr. Jones, who drinks so much he becomes unable to take care of the farm and feed the animals.  Over time, the animals (in particular the pigs), decide human beings are parasites and the pigs lead a revolt and run Mr. Jones off the property.  They change the farm’s name from Manor Farm to Animal Farm and create a list of 7 commandments.  They are:

  1. Whatever goes upon two legs is an enemy.
  2. Whatever goes upon four legs, or has wings, is a friend.
  3. No animal shall wear clothes.
  4. No animal shall sleep in a bed.
  5. No animal shall drink alcohol.
  6. No animal shall kill any other animal.
  7. All animals are equal.

Rather quickly, the pigs assume leadership over the farm and one pig in particular, Napoleon, consolidates power after running his primary competitor off the property.  It goes downhill from here fast.  The pigs start to walk on two legs, drink alcohol and sleep in beds, amongst other things. Understanding that their new lifestyle in in direct contrast with their original seven commandments, they simply decide to make some adjustments.  The adjustments are:

  1. No animal shall sleep in a bed with sheets.
  2. No animal shall drink alcohol to excess.
  3. No animal shall kill any other animal without cause.

Rather quickly, even these adjustments becoming too binding for the glutinous and power hungry pig oligarch class.  They decide to just condense everything down to one commandment:  All animals are equal, but some animals are more equal than others.

The above process is one for the ages, a process that has been reenacted time and time again by our species over the millennia.  It is exactly what is happening in these United States right now.

The reason I spend so much time on the Constitution and civil liberties these days is because I can see the above unfolding right before my eyes.  I also see an opportunity to stop it before it reaches its final, most destructive stage.  Whether it’s the Department of Justice turning journalism into a criminal act, the IRS going after political enemies, or our Noble Peace Prize winning President droning thousands of innocent men, women and children all over the world with flying robots, the oligarch class in this country is dismantling the Bill of Rights one amendment at a time.


Once the founding document that has served this nation so well over the centuries (certainly not perfectly, but still far better than other nations), is chipped away at enough that it is rendered meaningless, the final more brutal and in your face feudal structure will be implemented.  We cannot allow this to happen under any circumstances.

There are countless examples of rampant criminality and corruption as well as blatant evidence of a two-tier system of justice in America today.  Too many to note or write about, but in this case I want to focus on this concept of “money laundering” in light of the recent shutdown of Liberty Reserve.  This is how the Wall Street Journal describes the story:

The money was virtual, but prosecutors say the crime was real.


Officials brought charges against a group of men who allegedly manufactured an Internet-based currency to launder about $6 billion in ill-gotten gains, a sign of authorities’ rising concern with digital cash.


Liberty Reserve, which was incorporated in 2006, was a “bank of choice for the criminal underworld,” according to the indictment, which said the operation allegedly laundered the money through 55 million transactions before it was shut down earlier this month. The company has about one million users world-wide, including about 200,000 people in the U.S., according to prosecutors. They called the plot one of the largest money-laundering operations ever uncovered.


A spokesman for Liberty Reserve couldn’t immediately be reached for comment. Prosecutors said Tuesday that they arrested five of the seven men charged in the indictment Friday in Spain, Costa Rica and Brooklyn, N.Y., and charged them with operating an unlicensed money-transmitting business. The officials said they plan to seek extradition of those arrested abroad, and that the two remaining men are at large.


On Tuesday, in the first use of the 2001 Patriot Act against a virtual currency, the Treasury Department invoked a section of the law to choke off Liberty Reserve from the U.S. financial system. The Treasury’s proposal would prohibit U.S. financial institutions from opening or maintaining accounts for foreign banks that process transactions for Liberty Reserve and require special steps to guard against any transactions involving it.

Ok, now let’s compare the above to the way the authorities went after major financial institutions found laundering hundreds of millions of drug cartel money. HSBC is the most high profile example.  From Reuters:

(Reuters) - HSBC Holdings Plc agreed to pay a record $1.92 billion in fines to U.S. authorities for allowing itself to be used to launder a river of drug money flowing out of Mexico and other banking lapses.


Mexico’s Sinaloa cartel and Colombia’s Norte del Valle cartel between them laundered $881 million through HSBC and a Mexican unit, the U.S. Justice Department said on Tuesday.


“We accept responsibility for our past mistakes. We have said we are profoundly sorry for them, and we do so again. The HSBC of today is a fundamentally different organization from the one that made those mistakes,” HSBC Chief Executive Stuart Gulliver said.


Bank officials repeatedly ignored internal warnings that HSBC’s monitoring systems were inadequate, the Justice Department said. In 2008, for example, the CEO of HSBC Mexico was told that Mexican law enforcement had a recording of a Mexican drug lord saying that HSBC Mexico was the place to launder money.


No bank or bank executives have been indicted. Instead, prosecutors have used deferred prosecutions, under which criminal charges against a firm are set aside if it agrees to conditions such as paying fines and changing its behavior.

The difference in approach and in the application “justice” could not be more clear.  In the case of Liberty Reserve, the entity was isolated from the U.S. financial system and those arrested will be targeted for extradition.  Meanwhile a global manhunt is most likely on for the two remaining men at large.  In other words, “money laundering” was uncovered and the “justice” in this case is that the operation was closed and the participants arrested.  Ok.

Compare that to the HSBC settlement.  No bank or bank executives were indicted despite  the clear fact that there was a great deal of irresponsibility and criminality involved here.  Not only that, but the bank merely has to pay a portion of its profits and life goes on.  Like the IRS agents, they say they are “sorry” and promise to never do it again.  That’s what happens when oligarchs or their minions break the law.  When a regular citizen breaks the law, your life is ruined forever.

The crackdown on Liberty Reserve has nothing to do with “money laundering.”  It’s about a cartel of “too big to jail” banks and the fraud financial system they operate eliminating any players that try to encroach on their turf.  That isn’t capitalism, or socialism and it certainly isn’t anything close to freedom.  It is a parasitic, oligarch created feudalistic structure that must be done away with.  I often hear people say “we never learn from our mistakes.”  Incorrect.  People learn from their mistakes when there are consequences to their actions.  Of course criminals don’t learn from their mistakes when there are no serious consequences to their crimes.  Jail time would do the trick for a lot of bankers, politicians and bureaucrats.

In the meantime: Some money launderers are simply more equal than others.

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Thu, 05/30/2013 - 21:52 | 3612384 Zero_Sum
Zero_Sum's picture

Saw this story a few days ago. I was wondering how long it would take to hit ZH.


Thu, 05/30/2013 - 22:03 | 3612415 Al Gorerhythm
Thu, 05/30/2013 - 22:10 | 3612427 CH1
CH1's picture

This IS tyranny.

Thu, 05/30/2013 - 22:14 | 3612434 LetThemEatRand
LetThemEatRand's picture

Just bear in mind that the guys who arrested them were the same guys who some believe will not turn on us if push comes to shove.

Thu, 05/30/2013 - 22:29 | 3612484 otto skorzeny
otto skorzeny's picture

I think more and more people are becoming aware of the fact that these fucking donut eaters are part of the problem.

Thu, 05/30/2013 - 22:33 | 3612499 LetThemEatRand
LetThemEatRand's picture

Propaganda works.  Many of the popo see us as "civilians," which is code for the useless eaters who need to get in line.

Thu, 05/30/2013 - 22:43 | 3612525 otto skorzeny
otto skorzeny's picture

Too much cop-worship by MSM and Hebeywood gives them an exaggerated sense of self-worth. 

Fri, 05/31/2013 - 01:41 | 3612543 Andy Lewis
Andy Lewis's picture

Gotcher Hebeywood right here, fuckface.


On edit: 8 junks?  This place must be a confederacy of dickroaches.

Fri, 05/31/2013 - 03:52 | 3612832 malikai
malikai's picture

It is becoming infested with dickroaches.

Where do you [people] keep coming from?

Fri, 05/31/2013 - 06:31 | 3612886 g speed
g speed's picture

please be the first to pull down your drawers and bend over when the time comes---remember those closest and the most fanatical are the first to be purged.

Fri, 05/31/2013 - 07:32 | 3612933 merizobeach
merizobeach's picture

Well, then, fuck you, Andy Hebeywood Lewis; fuck you right in your fuckface.

Thu, 05/30/2013 - 22:50 | 3612548 LetThemEatRand
LetThemEatRand's picture

It's a lot more than that.  And as an aside, the Jew angle is EXACTLY the same thing you are pissed about.  They love to divide us by race, religion, Red Team, Blue Team, etc.

Fri, 05/31/2013 - 00:28 | 3612733 Buckaroo Banzai
Buckaroo Banzai's picture

"You know the score, pal. You're not cop, you're little people!"

Thu, 05/30/2013 - 22:37 | 3612512 SafelyGraze
SafelyGraze's picture

in my home country, people were depriving the government of taxes by eating food they grew on their land. also they were depriving vendors of revenue that would have been received through the sale of food.

the problem has been corrected by charging people whenever they eat food grown on their land. it is a "virtual purchase" tax. kind of like paying a restaurant when you bring your own bottle.

the tax is split between the government and the vendors of the foods you failed to purchase due to your own stubborn instistance on eating food you grew yourself.

it works really well.


Thu, 05/30/2013 - 22:53 | 3612557 Yes_Questions
Yes_Questions's picture



Boris' cousin?

Thu, 05/30/2013 - 23:44 | 3612662 Terminus C
Terminus C's picture


Fri, 05/31/2013 - 06:02 | 3612870 malikai
malikai's picture

Uh, what country is that?

I have an avoidance list. Just want to make sure I check and add as necessary.

Fri, 05/31/2013 - 06:56 | 3612900 Downtoolong
Downtoolong's picture

Right here in the good ol USA. It's little different in concept when property tax authorities raise rates to maintain constant tax revenues as property values fall.   

Fri, 05/31/2013 - 07:53 | 3612966 merizobeach
merizobeach's picture

Brutal video; thanks for sharing.  I accidentally put it on fullscreen, and when one of those douchebag pigs got his face up in the camera, I started shouting at him and flipping him off.  Almost made me want to be there to deliver the abuse in person, but having been arrested by similar thugs before for circulating ballot initiative petitions (on the sidewalk of a closed-to-vehicles street at Denver's "People's Fair", of all places), as much as I would love to return to those cops some of the hate they have for us, that would mean my traveling back to the USuckAss, and that's not going to happen.  I used to be a patriot; not anymore.  I'd rather live an enjoyable life in a decent part of the world rather than fight that old good futile fight and then die still fighting it without having accomplished anything but having watched the ever-rising tide of tyranny in my face the entire time.  All of you who somehow still live there can keep that stinking country; I get plenty of exposure here on ZH, and though I'm always happy to read it here, I'm also happy to click close when I'm done and have no more to do with it.  Save yourselves, bitchez.  Best of luck to you.

Fri, 05/31/2013 - 08:46 | 3613097 pazmaker
pazmaker's picture

happy for you man!...but isn't Guam a US territory?

Wed, 06/05/2013 - 12:27 | 3626561 merizobeach
merizobeach's picture

Yes, it is, bro.  Although Guam is rather paradisical, I stayed there just for the years of university.  And although it is technically a colony of Big O's fascist serfdom, I'd still recommend a nice long stint there and a survey of the outter islands, of which there are many; don't miss Palau.  :-)

Thu, 05/30/2013 - 21:55 | 3612390 fonzannoon
fonzannoon's picture

There is nothing left say about these types of stories.

Thu, 05/30/2013 - 22:46 | 3612534 Yes_Questions
Yes_Questions's picture



Oh, we'll come up with something for this, and each new one.


With attendant wording like FUCKING PIGS or some sort.


We'll do just fine.. 

Fri, 05/31/2013 - 06:14 | 3612878 Bendromeda Strain
Bendromeda Strain's picture

One could say "it wasn't the pigs that were glutinous - it was the horses".

Thu, 05/30/2013 - 21:59 | 3612398 LetThemEatRand
LetThemEatRand's picture

In related news, Labron James -- who makes $200K per game not counting endorsements -- was fined $5000 for flopping.  Like the bankers, he expressed his disappointment with the penalty but expressed his endorsement of the justice of the system whilst climbing into his million dollar car.

Thu, 05/30/2013 - 22:16 | 3612440 grunk
grunk's picture

Too Big To Suspend.

Thu, 05/30/2013 - 21:58 | 3612403 One And Only
One And Only's picture

No one gives two cunty fucks.

This is America, land of the home, free of the brave.

Thu, 05/30/2013 - 22:25 | 3612472 LetThemEatRand
LetThemEatRand's picture

I Pledge Allegiance, to the Articles of the United States of Incorporation.  And to the Bondholders, for which it Stands, with Liberty and Justice for None.  Amen.

Thu, 05/30/2013 - 22:32 | 3612497 grunk
grunk's picture

You had me until "Amen."

Now I'm going to sue, get treble damages, take your house and your dog. 

Thu, 05/30/2013 - 22:36 | 3612503 LetThemEatRand
LetThemEatRand's picture

I added it because most of the people who love the pledge are the same folks who want the government to require school prayer.  God Bless the United States of America.  And fuck the Godless Muzzies and their kids.

Thu, 05/30/2013 - 22:46 | 3612528 newengland
newengland's picture

One nation under God, founded by protestants. Others come to the USA, escaping the horror of their failed lands.

The ingrates are ripping each other apart, much as they did in their nations of origin.

Thu, 05/30/2013 - 22:51 | 3612552 LetThemEatRand
LetThemEatRand's picture

Remind me who did the witch trials.

Thu, 05/30/2013 - 23:29 | 3612638 Pure Evil
Pure Evil's picture

Damn Germans.

Thu, 05/30/2013 - 23:51 | 3612673 LetThemEatRand
LetThemEatRand's picture

All of them?

Thu, 05/30/2013 - 23:40 | 3612655 forexskin
forexskin's picture

the rye ergot was good - ummm, or not...

Fri, 05/31/2013 - 12:11 | 3613844 Lost Word
Lost Word's picture

There were at that time plenty of witch trials in Europe, run by both Protestants and Catholics.

Plenty of witch trials today also, under the name of Government tyranny and new Psychiatry definitions of mental illness, sufficient to deny citizens of their Constitutional rights.

Thu, 05/30/2013 - 22:39 | 3612514 Yes_Questions
Yes_Questions's picture



and/or Neoliberal Injustice for ALL.

Thu, 05/30/2013 - 21:58 | 3612405 Saucy-Jack
Saucy-Jack's picture

HSBC has been laundering money since the 18th Century. Can you say opium?

Thu, 05/30/2013 - 22:00 | 3612410 Room 101
Room 101's picture

And they'll be doing it in the 22nd century.  Who cares?  It's just the way it is.   

Thu, 05/30/2013 - 23:41 | 3612658 Arkadaba
Arkadaba's picture

I care

Fri, 05/31/2013 - 01:33 | 3612778 James_Cole
James_Cole's picture

And they'll be doing it in the 22nd century.  Who cares?  It's just the way it is.   

Apathy - the most reliable ally to tyranny. 

Fri, 05/31/2013 - 04:48 | 3612857 BringOnTheAsteroid
BringOnTheAsteroid's picture

Non apathetic posts on ZH is not going to change shit either.


Arms crossed, tapping foot, looking around . . .

Nup, nothin. Not even a hint of revolution. In fact a teenage girl just walked past and spat her gum at my feet.

Fri, 05/31/2013 - 06:47 | 3612896 g speed
g speed's picture

you are looking for love in all the wrong places---Q: did JPM go after you or after Lieman??? A: "they" don't know you and besides they will only go after those that are a threat including and most probably thier partners in crime and power.

thought for today--"the meek shall inheirit the earth".

Fri, 05/31/2013 - 10:48 | 3613556 Kirk2NCC1701
Kirk2NCC1701's picture

You did fine until the last line.

No one here (but the most gullible of sheep) believes that one.

Fri, 05/31/2013 - 12:14 | 3613858 Lost Word
Lost Word's picture

It is a mis-translation of the original Aramaic language into Greek.

Thu, 05/30/2013 - 22:36 | 3612509 grunk
grunk's picture

Who is HSBC?

Not what does it stand for. Who runs it?

Where do they live?

Where do their kids go to school?

Fri, 05/31/2013 - 06:40 | 3612889 g speed
g speed's picture

saucy jack-----

ah yes---the court jew--(wiki) -that is how the power is consoladated. The crown uses the gold and the financers use the crown and that is probably where "bucky" Fuller came up with "the whole is greater than the parts"

Fri, 05/31/2013 - 07:31 | 3612928 Dick Buttkiss
Dick Buttkiss's picture

But to say that HSBC is the worst at present is to forget about the billions in Mexican drug money that Wachovia laundered:


Kreiger is right, though, that this isn't about money laundering but whose monetary system gets to control it as the rationale for destroying financial privacy.

Gooooooooo BITCOIN.


Thu, 05/30/2013 - 21:59 | 3612406 Room 101
Room 101's picture

This type of story is no longer news.  That we have a two or three tiered legal system is simply accepted fact.  Same as it was yesterday, same as it is today, same as it will be tomorrow.  Why waste the electrons to write about it? 

Thu, 05/30/2013 - 22:35 | 3612506 Row Well Number 41
Row Well Number 41's picture

Go Die



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