Monday, July 4, 2011

Have you heard the phrase "money laundering?" Thank Al Capone.

There's a PBS documentary airing in October about Al Capone and prohibition. I'll probably watch it. I like reading about organized crime. I don't condone it in any way, but I do like to learn about it.
   A lot of people think the gangsters of prohibition got their start when booze became illegal in the United States because of the Volstead Act. That's not quite true.

Prohibition made the gangs bigger and the gangsters richer, but most of them, including Al Capone, were crooks before prohibition.

Al Capone, for instance, invented money-laundering.

Capone got his start as the owner of a laundry. He went after hotel business: bed sheets, towels, tablecloths, etc. In Chicago. There were a lot of hotels. Initially, there was a lot of companies doing the laundry for the hotels. Al Capone started muscling them. Their trucks had "mechanical difficulties", and when the competitor couldn't pick up the dirty laundry, Capone's trucks picked it up. He started gaining business from hotels. His guys made it clear that Capone's company was the "best" way to go. From what I can gather, they weren't very nice about it.

Then prohibition came along. He had trucks, he had men, he had a legitimate business. When they made money from the sale of illegal booze, they put the money through the laundry business books...

They "laundered" the money.

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