When the Soviet Union collapsed, I was a member of the Panamanian underworld that laundered drug money for Colombia’s Cali drug cartel. My friends in Panama’s mafia, several of whom had high-level KGB connections, also worked with Russian power brokers to launder and invest in assets stolen from the Russian public as its economy was privatized. U.S. dollars were everywhere in Russia, so it was friendly territory for those that had mountains of the favored currency of organized crime, U.S. currency.
At the time, Vladimir Putin had just resigned his position in the KGB and embarked on his political career, eventually aligning with Boris Yeltsin. He certainly knew the KGB generals and people of power that served my mafia friends. Those generals, Russia’s elite, and my underworld buddies helped create fortunes for everyone in that game. Once Yeltsin was out of the way, it was easy for Putin to slip into this unholy alliance and exponentially continue the plundering.
Through politically connected businessmen, later dubbed oligarchs, they participated in the purchase of Soviet assets stolen from their rightful owners, the Russian people. Then, with the help of corrupt lawyers, bankers, and financial service providers in Cyprus, the British Virgin Islands, Panama, Seychelles and other secrecy havens, the oligarchs and other criminals set up a constellation of offshore companies that made it impossible for any government to follow the money trail. Through those untold veils of secrecy, they controlled massive companies, bought yachts, acquired mansions and much more.
Headlines over the past several years have confirmed the constant flow of hundreds of billions from Russian coffers to oligarchs with the help of Danske Bank, Deutsche Bank, IBA Bank, Troika Bank, Swedbank and many others. The fortress of secrecy that the oligarchs have built around the grip they hold on much of Russia’s wealth is impenetrable. Those who had key information about it, like the former CEO of Danske Bank, Aivar Rehe, and the former deputy chairman of the Central Bank of the Russian Federation, Andrei Kozlov, have been found dead.
United Russia has been one of the most important investments made by the oligarchs. It is Vladimir Putin’s political party. The survival of the oligarchs, financially and physically, has become dependent upon Putin’s every whim. What portion of Russia’s pilfered treasury has filtered its way to Putin’s secret control is only a guess. Having been a money launderer for some of the most infamous criminals that walked this planet, I can tell you firsthand that top level mafia leaders and corrupt world leaders have unique resources that cast a veil of secrecy over their fortunes. These resources are countless corrupt professionals who construct sophisticated shrouds that prevent typical law enforcement personnel from seeing 98 percent of the more than $2 trillion in illicit capital each year seeking secrecy from governments.
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I lived a life of crime for five years, working shoulder to shoulder with dirty bankers, lawyers and businessmen. In many instances, the laundering of blood-stained dollars moved through institutions that endorsed those acts. It was part of their corporate policy. Unfortunately, for my partners in crime, until my veil of secrecy was lifted, they didn’t know that I was a U.S. federal undercover agent who had recorded thousands of conversations that confirmed beyond a reasonable doubt that they were responsible for pumping blood through the heart of the underworld. Without highly sophisticated money launderers, mafias are vulnerable. They become exposed because they can’t otherwise disguise the methods they use to buy politicians, prosecutors, judges and military leaders in more countries than you can imagine.
It’s that reality that compelled me to write two memoirs about my undercover life. The first, “The Infiltrator,” is the New York Times bestseller that chronicled my infiltration of Pablo Escobar’s Medellin Cartel and the Bank of Credit & Commerce International (BCCI). It was also the basis for an internationally released film by the same name, starring Bryan Cranston.
Having lived within the underworld as described in “The Infiltrator,” what I saw during that underworld emersion convinced me that BCCI was not an anomaly. I got the unique opportunity to debrief some of the BCCI officers behind bars, while they slowly began to serve lengthy prison sentences. What they said, and the records confirmed, was that they were simply doing the same thing that a significant segment of the international banking and business community has done for many decades. They helped drug dealers, tax evaders, corrupt third-world leaders, illegal arms dealers, corrupt politicians, fraudsters and even intelligence agencies hide their fortunes from the eyes of governments.
Of course, if you listen to statements publicly offered by pillars of the banking and business community, it’s absurd for anyone to suggest that many of the professionals in those industries intentionally serve the underworld. I knew otherwise. I got to see the reality of the financial sector long before the Panama Papers, the Pandora Papers and the many other recent leaks of secret files stored at the offices of lawyers, banks and financial services providers. Because of my journey in “The Infiltrator,” I was obsessed about returning to that underworld. If I could get the law enforcement community to focus, and recognize the importance of aggressively addressing that threat, we could deal a massive blow to mafias and corrupt governments around the world.
Within two years after I finished testifying against Medellin Cartel leaders and BCCI executives, I developed a totally new identity, companies and everything else I needed to take a second plunge into the cesspool of the underworld. This time the Drug Enforcement Administration proposed an operation where I was given the go-ahead to attack the leaders of Colombia’s Cali Cartel, Panamanian underworld members and a horde of banks helping transform hundreds of millions in cocaine profits into innocent-appearing legitimate export revenue. This second journey into the underworld is detailed in my newly released memoir, “The Betrayal.”
“The Betrayal” journey put me in rooms with some of the most sophisticated financial professionals in Latin America, brilliant minds that created highly complex legitimate appearing fronts that were perfect stealth vessels for the movement of filthy money. With the help of lawyers, CPAs, bankers and “reputable” businessmen willing to sell their names for a fee, I was given the keys to secretly control Lichtenstein foundations, British Virgin Islands companies and Panamanian corporations that collectively created a forest of confusion that provided perfect cover for my clients’ filthy fortunes.
A meeting detailed in “The Betrayal” with bankers that handle hot money exemplifies why the elite leaders of crime have little to fear from governments trying to seize their fortunes. In the privacy of my undercover office, as video cameras caught every word and movement, I introduced them to my drug trafficking client, actually a DEA undercover agent posing as a drug kingpin.
Here is an excerpt from “The Betrayal” that recounts that moment:
These bankers already knew it was my job to get the cash into the banking system in a way that made it look legal. Upon learning that Diaz (the trafficker) had obtained U.S. citizenship, the bankers explained that their branch in Panama wasn’t officially opening accounts for U.S. citizens, but with the help of financial service providers outside the bank, structures could be purchased and put in place for the money to be held in accounts in the name of foreign trusts. Despite those veils of secrecy, Diaz (the trafficker) and I would control the accounts by providing our instructions orally, not on paper.
Diaz gave them the bottom line. “We have to be absolutely guaranteed that I and the other people will never show up in anything. I mean, that’s a hundred percent guaranteed?”
The banker’s reply said it all. “We prefer it that way, although from time to time, when you are talking about these kinds of money, the client wants to meet me and say, I’d like to measure these people. … But what I’m trying to say is that, if there is anything that is irregular, I don’t want to know about it, so I prefer that you keep me in the dark about these things and just let me do my job managing the money.”
One of the bankers from Panama offered interesting advice about our avid use of computers, cell phones, and beepers. “I warn you though, the computer is becoming. ... The technology is really taking over, and it’s great to have it, but a lot of people can be listening in on these frequencies. So, the more that we use technology, the more we open our legs to disclosure. And the only place that has disclosure is the United States of America. The rest of the world keeps their legs crossed and their mouths shut, and they tell only the people who have to know. And that’s the way you should handle your money.”
Betrayal within my own agency shortcut my efforts to shine a bright light on the army of professionals that service the underworld. I’m amazed to this day that one of my own chose to go to the dark side and live a life of crime while masquerading as my friend and colleague. At a time when he knew Colombian cartel leaders were offering $300,000 for the head of a DEA agent, and while I worked undercover in high-risk countries like Panama and Colombia, he compromised my undercover identity. While he moved dope, money and government secrets for them, he wasn’t fazed that I was likely to be kidnapped, tortured and killed. (He later served a decade in prison, was released and now appears to be a productive member of his community.)
Money and power lures weak minds to sell their souls. If you find it hard to believe that “proper professionals” can sell their souls to enrich themselves and their dirty clients, then you certainly can’t imagine being betrayed as badly as I was. It’s important to face reality.
Look closely at the few mega-yachts and mansions seized from oligarchs. A light was shone on most of those assets by investigative journalists who scoured social media, linking the use of those toys to oligarch family members.
The ability to locate and open the secret vaults that hold the riches of Putin, drug kingpins, and mafia Dons lies in the hands of the world’s law enforcement and intelligence communities. They should be given the greenlight to create a global task force that targets the biggest money launderers on this planet, the professionals that service the underworld. But they can’t do that on their own. They need global political will and support for that initiative. Unfortunately, there are too many people in power who are part of “The Betrayal.” They’ll never change the rules for the most powerful of the rich.
Robert Mazur, a federal agent for 27 years, is a court-certified expert in money-laundering related matters in both the U.S. and Canada. He is the New York Times best-selling author of “The Infiltrator,” a memoir about the first half of his life undercover as a money launderer within Pablo Escobar’s Medellin Cartel, and was an executive producer of the film by the same name. His new book, “The Betrayal,” is a memoir about his final undercover assignment, a deep dive into Colombia’s Cali Cartel and Panama’s underworld that nearly cost him his life. He is president of KYC Solutions, a company that provides speaking, training, consulting and expert witness services globally.