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Comment by ChuckMcM | Hacker News Reader

It makes me think of a recent write up on modern day money laundering. One way to do so is to have an app with in game purchases, your mules buy burner phones and start buying in-game stuff using their phone account. Money goes into the wireless store, comes out of the App store. "Honey are you launding drug proftis?", "No dear, I'm just addicted to HoneyBear Racers!"

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But money laundering usually involves illicitly acquired cash and converting that into legit money you can invest/store/etc. Seems like localbitcoin to Monero to anything else makes more sense. No?

Strictly speaking, money laundering is any activity that makes it impossible to follow a monetary trail. Whether that is in game tokens, some sort of block chain technology, or gallon jugs of Tide detergent.

And yes, it can involve illicitly acquired cash, but it can also be used to conceal the purchase of assets or the exercise of political influence.

> gallon jugs of Tide detergent

Huh, I never knew about the underground trade fueled by tide detergent. Well there goes a solid chunk of today's reading time.

Old HN post on the subject for others interested: https://news.ycombinator.com/item?id=5023204

per wikipedia

Money laundering is the process of transforming the profits of crime and corruption into ostensibly 'legitimate' assets.

It's 2017 and we're still looking up the reference book definition of laundering. Office Space was onto something.

Let's be honest, Office Space was onto everything.

Probably because it's such a non-thing, a fake crime invented to make prosecutors lives much easier.

In this instance isn't the money illegally acquired and then laundered by way of app store gift cards purchased with cash?

Ah gotcha, that makes more sense. I was wondering why they went through the trouble of tying their App Store/Play Store to their bank accounts and purchasing IAP all over again.

Suddenly the more expensive IAPs in games such as Talking Tom Gold Run make a lot more sense.

As you play the game you can unlock some characters. But it's a very slow grind. You can also buy them.

The five most expensive characters cost £19.99, £28.99, £38.99, £48.99, and 5399 sticks of dynamite. You can buy 5,400 sticks of dynamite for £99.99

In many cases it's about exporting cash.

A young Chinese business dude bought a vacant 20 story former bank headquarters last year in my city to supposedly convert to condos. Nothing has been done there -- it's just a way to park money out of the hands of the PRC.

Not really. Money laundering is about making your money seem like they're coming from a legit source. And the best way to do that is by buying a company that's hard to trace customer's money, a casino is the prime example. No one can tell if customers spent 50k or 500k.

Converting illicitly acquired money to cryptocurrency and back to cash doesn't answer the question where did you find the money in the first place. But say you have a coffee shop, then you can claim that you sell twice as much beverages as you really do, pay the taxes and have your money cleaned.

Cryptocurrency is handy though, as you can setup a digital download store offering "legit" stuff like reports, paid in coins. Especially if you offer sales via a hidden site, you really wouldn't have any useful records like IPs to corroborate.

I'm not seeing how cryptocurrencies help you to get "legit" money. And you can buy gift cards for iTunes and the Play Store using cash, so this is a good way to launder cash into legit money that is paid out by the owner of the app store.

I think you can buy app store gift cards with cash.

How much does it usually cost to launder money? Apple's 30% cut seems pretty steep.

30% feels like a decent bargain if you finally get to take the other 70% out of the duffel bags/safety deposit boxes. Especially if that enables you to spend it on things that mitigate risky behavior, such as lawyers.

Consider most people legitimately needing to launder money likely already have a lot of it and aren't necessarily looking for a bargain.

That does sound like an interesting way of doing it except that the distributor (Apple, Amazon, Google) can be subpoenaed and the exact amount of money, probably along with who spent it, can be found. So maybe it works on small time operations but it would fall apart a lot faster than traditional money laundering fronts like nail salons and other cash businesses.

You sound skeptical :-). Take that thinking through to the next step. What does Google, Amazon, or Apple know?

They know the publisher of the game who is getting revenue from it.

The know the thousands/tens of thousands/millions of accounts which has processed a purchase (probably hundreds of purchases per user) through it.

Some fraction of the user base is 'legit' which is to say they are playing for their own reasons.

I think the only way you prosecute that is that you find someone who was told, take this money, buy an iTunes/Play /Amazon gift card, use that card to buy items in this specific game. and finding that person would be very difficult. The dealers could literally hand gift cards to addicts for their kids to play their game while they are high.

I agree that there are pretty 'classic' schemes that could process more money but some of these online games are pretty amazing at the numbers they pull in monthly. Hard to explain a nail salon doing 5 million dollars a month in revenue.

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