Money laundering investigation stymied by China, Italy says

As Italy’s economy was heading off a cliff, police couldn’t help but notice that the country’s Chinese communities were booming. Luxury cars rolled past Chinese betting parlors and garment factories. Chinese immigrants were buying up Italian coffee bars and real estate. Their prosperity, however, was not reflected in local tax records. The answer, after a four-year investigation by Italy’s financial police, was no. They discovered that more than 4.5 billion euros ($4.9 billion) — the proceeds of counterfeiting, prostitution, labor exploitation and tax evasion — had been smuggled out of Italy to China in less than four years using a money-transfer service. Nearly half that money was funneled through one of China’s largest state banks, the Bank of China, which earned more than 758,000 euros in commissions on the transfers, according to Italian investigative documents obtained by The Associated Press.

What do they do with the money? Do they eat it?

Italian Ex-deputy public prosecutor Pietro Suchan

Beijing, which is seeking Western help in hunting its own economic fugitives, did not cooperate with the investigation, Italian officials said. Despite the deep economic ties between China and the West, inconsistent cooperation, incompatible legal systems and China’s secrecy laws have allowed criminals to globalize more effectively than law enforcement — and made it harder for Western companies and courts to put them out of business. China’s foreign ministry said in a faxed statement that Chinese authorities knew nothing of the Italian case. “China is always committed to deepening law enforcement cooperation with other countries, jointly cracking down on transnational crimes and punishing criminals,” the ministry wrote.

China now needs the assistance of foreign countries. To get that, they’re going to have to offer assistance themselves.

Franco Roberti, Italy’s chief anti-mafia prosecutor

Europe Money laundering