WATCH FOR LARGE TRANSFERS OF US DOLLARS TO ARGENTINA IN LIGHT OF POTENTIAL DOLLARIZATION OF ITS ECONOMY

The new President-elect of Argentina, Javier Milei, has indicated that one of his ideas about stabilizing his country's perennially distressed economy is to with from the problematic Argentina peso to the US Dollar, a currency move that other nations in Latin America have undertaken, with successful results. The problem is, Argentia is a bit short on US Dollar reserves. Dollarization may or may not happen, but it does raise the issue of whether  money launderers might be also to rishly profits from such a government policy.

Money launderers, who are always alert for new, shall we say "opportunities' to clean the proceeds of narcotics trafficking, also monitor political and economic news in Latin America, looking for what we call targets of opportunity. They know that when Members of the European Union joined the Eurozone, currency exchanges afforded enterprising laundrymen unique possibilities to convert criminal profits, free from meaningful AML. There were just too many people for government agencies to check, and public policy did not favor widespread inquiries. Dirty money was cleaned, or integrated into legitimate investments to the degree that it was not subject to being exposed. Laundrymen are students of financial history; now you know why.

Therefore, compliance officers at international banks should advise their frontline staff to be alert for any large USD transfer into Argentina, especially if they are coming from an offshore financial center,  briefly transiting the US or EU, and then moving on to Buenos Aires. If I was still a money launderer, I would  have my have my eye on Argentina this month. You are advised to do the same.