How do criminals obtain large amounts of cash?
October 5, 2013 6:39 PM   Subscribe

Watching Breaking Bad and wondering, where do criminals come up with gym bags full of cash? Assumptions and potentially faulty reasoning inside.

Minor Breaking Bad spoiler alert: So Mrs. Ga$money and I are catching up on Breaking Bad (better late than never), and we got to the part where Gus pays Walt and Jesse something like a million dollars in cash. But where does an enterprising criminal get their hands on that kind of volume of physical cash? Gus isn't a street dealer, so I assume it's not coming in directly in dribs and drabs from individual sales. And even with his businesses, it's not like he can just take a million out of the till and stuff it in a bag. I'm guessing trying to buy that kind of cash from a bank is pretty much a non-starter, even if they could find a crooked banker willing to bend some rules. So assuming this isn't just a dramatic vehicle that never happens in real life, where do criminals get large amounts of cash for this kind of transaction?
posted by ga$money to Work & Money (22 answers total) 4 users marked this as a favorite
 
It's an empire. Gus sells the vat of meth to his distributors, who pay in cash.
posted by roomthreeseventeen at 6:40 PM on October 5, 2013 [3 favorites]


Illegal drugs are a cash only business. The users pay cash to the dealers, who pay cash to the distributors, who pay cash to the manufacturers.
posted by Rock Steady at 6:46 PM on October 5, 2013 [5 favorites]


Well, presumably the business is profitable for some people, and they cannot use banks. So their profits take the form of cash. I've heard radio stories about people who had more cash than they knew what to do with, and had a hard time protecting it / sleeping at night. Surplus cash is a very real problem, it seems.
posted by pwnguin at 6:46 PM on October 5, 2013 [1 favorite]


This is a tough question to answer without spoilers, but yeah, you'll see exactly how Gus's cash comes in later in the series.
posted by mannequito at 6:47 PM on October 5, 2013


Best answer: Gus isn't a street dealer, so I assume it's not coming in directly in dribs and drabs from individual sales.

It's coming in indirectly in bulk from middlemen. Those middlemen get money in smaller bulk from dealers (or other middlemen), who get paid in cash from their customers. The only real hitch in the chain is changing $10 and $20 sales into $100 bills for easier transport, but that's where Los Pollos Hermanos comes in handy -- it's easy for him to convert a lot of small bills into bigger ones by laundering it through the restaurants, because no bank is going to wonder "Hey, why is this fast food place bringing in so many $10 and $20 bills?"
posted by Etrigan at 6:47 PM on October 5, 2013 [5 favorites]


Most criminals don't. You're making silly assumptions. When I TAed a Criminal Justice in America course I remember the tidbit that for the vast, vast majority of "criminals" their "salary" didn't even amount to minimum wage.
posted by ethnomethodologist at 6:48 PM on October 5, 2013


Response by poster: Ethnomethodologist, I think you missed this clause: "So assuming this isn't just a dramatic vehicle that never happens in real life..." I'm pretty open to the fact that crime usually, literally, doesn't pay, having known a few low-level dealers over the years who always seemed to be living a very modest if not outright depressing life-style. I think the series itself does a good job of showing that it's often not worth the effort. So, yeah, setting aside that it's probably all Hollywood nonsense, where does the cash come from?

Etrigan, thanks, I think you filled in the missing point -- I would think Gus wouldn't pay Walt with a bag of grubby junkie dollars, so exchanging it through his business makes sense. Thanks!
posted by ga$money at 6:59 PM on October 5, 2013


Best answer: Up until very recently, cash control was a huge problem in retail stores. Dealing with cash is a huge pain in the ass, and criminals don't have the luxury of being able to deposit it every night. So the cash flows up the same pipeline the drugs flow down.

Fun fact: bills larger than $100 used to exist, and were withdrawn from circulation specifically to make criminal enterprises harder to deal with.
posted by gjc at 7:38 PM on October 5, 2013 [3 favorites]


Best answer: You've got your answer, but as an addendum, Stephen Levitt, the economist half of the Freakonomics team has this TED talk about the research that was described in the first Freakonomics book by a Chicago Sociology student, Sudhir Venkatesh (wikipedia), who stumbled into a den of drug dealers, more or less, and was literally held captive until he was able to talk his way not only into the trust of the tier up from the street dealer, and ultimately was let into looking into the full organization of a crack-pushing operation. It turned out that crack sales is a multi-level sales scam which pulls money to the top-level, and pushes risk down to the bottom-level.
posted by Sunburnt at 8:12 PM on October 5, 2013 [4 favorites]


For what it is worth, the units of currency often seen on Breaking Bad are straps.
posted by Rock Steady at 8:13 PM on October 5, 2013


I was in the main branch of a major bank in my large city once, buying some foreign currency. The guy at the counter next to me bought 100,000 Euro. It took SLIGHTLY longer than my own transaction, but not by much, and he stuffed it into a gym bag and left. The teller didn't seem surprised or suspicious of his request, and I didn't see her call the police or anything afterwards. Based on that, I would guess that large banks do actually sell/buy huge amounts of cash so frequently that it isn't a big deal. But maybe if you are a criminal you would be extra careful anyway.
posted by lollusc at 11:58 PM on October 5, 2013 [1 favorite]


Not sure what you mean by "buy that kind of cash" -- if someone has money in a bank, they can withdraw cash as they please. Criminals often get money *into* a bank via laundering to get it on the books- there's a great montage of this in the Pacino Scarface.

As far as "Breaking Bad," the answer is that that show was wildly, often comically implausible from start to finish and made only the smallest of token efforts to resemble life on Planet Earth.
posted by drjimmy11 at 2:25 AM on October 6, 2013


"But where does an enterprising criminal get their hands on that kind of volume of physical cash?"

Um, what? Oh, you mean converting small denominations into large denominations maybe? Drug dealing is a cash business and the banks are all too happy to help any depositor. It's legitamizing the cash and putting it into banks [money laundering] that is the problem for dealers.

Drug dealers have plenty of cash.
posted by vapidave at 4:38 AM on October 6, 2013


Based on that, I would guess that large banks do actually sell/buy huge amounts of cash so frequently that it isn't a big deal.

Every transaction that involves more than $10,000 cash must be reported to the Financial Crimes Enforcement Network through a Currency Transaction Report.
posted by Rock Steady at 5:00 AM on October 6, 2013 [7 favorites]


As a related aside, countries like the Philippines still have a largely cash-based economy, and cash handling is done by a horde of armored trucks operated by contractors like G4S. At any point throughout the day, there's guaranteed to be at least one within your sight in Metro Manila.

However, even with all this cash moving around, if you need Php 500k (about USD 11k) or more, it's best to tell the bank in advance so they have it ready for you.
posted by a halcyon day at 5:22 AM on October 6, 2013


To add on to Sunburnt's answer, Venkadesh wrote "Gang Leader for a Day" about his experiences. It's a great read.
posted by JoeZydeco at 7:28 AM on October 6, 2013 [1 favorite]


Sunburnt: It turned out that crack sales is a multi-level sales scam which pulls money to the top-level, and pushes risk down to the bottom-level.

You're actually describing all organized crime, from a pimp and his hookers to full-scale South American cartels.

Unironically, you're also describing the military.
posted by IAmBroom at 11:09 AM on October 6, 2013 [4 favorites]


There's a Cash Services Industry whose job it is to obtain new currency, sort and count and bundle older currency, deliver coins by the box (for US, 2000-3000 coins, in rolls, depending on denomination), and so on. These Cash Services companies are either affiliated with or one in the same as Armored Car services that serve banks and businesses.

Retail operations take in a lot of big bills and give out a lot of small ones, and most don't have more than a few days worth of small bills on site, so they buy small bills from the Cash Services company. Presumably the same company has customers who are burdened with coins and small bills and want to sell those for big. Vending/Coin-op machine companies, for example, and probably crooks.

For that reason, Cash companies probably have some reporting requirements for those who want a plain cash conversion. If the hypothetical crook wants to deposit in one Cash company, and withdraw from another Cash company, the transaction would have to go through a banking layer somewhere and that would have its own regulatory/reporting requirements.
posted by Sunburnt at 11:13 AM on October 6, 2013


Mod note: One comment deleted; not a problem, but let's not pursue the more general "which other entities operate like MLM" question here. Thanks.
posted by LobsterMitten (staff) at 11:22 AM on October 6, 2013


Cash only business. According to wikipedia, Pablo Escobar spent $2500 a month just on rubber bands to wrap his cash, with 10% of the cash lost due to rats chewing it to bits in the warehouses.
posted by smcameron at 9:13 PM on October 6, 2013 [2 favorites]


Yeah, the problem isn't really "where does the cash come from" as it is "what to do with it all." This is actually one of the more realistic elements of the TV series. Some drug lords have so much cash that they weigh it rather than counting it, and because of the reporting requirement mentioned by Rock Steady, it needs to be laundered a little bit at a time. (This also comes up in Breaking Bad.)
posted by Halloween Jack at 12:40 PM on October 8, 2013


It occurred to me that the chicken restaurant with which Gus is affiliated is also a great solution to the cash bills problem. Like all retail businesses, a fast-food restaurant accumulates large bills while giving out small bills and coins as change. Most businesses handle this by hiring a cash services (read: armored car) company which handles the cash bill and coin supply needs of the business. Possibly Gus is acting as his own cash services company, supplying the small bills directly from drug revenue (naturally this goes through a locked room with a few old people counting/stacking cash while stripped to their underwear, if movies are any guide) and buying the coins through a legit cash-services company. It would be difficult for the Feds to figure out that Pollo Loco was failing, somehow, to buy small bills in the expected amounts, especially considering that Gus operates on the chain level.

It's not money laundering in the sense of legitimizing illicit income, but rather a bill-trading scheme. The Cash company wouldn't notice that PL is buying fewer bills than expected, because it would be an extreme challenge to figure out what is expected, and there's no law against using multiple Cash Services companies, as long as all the banking laws are obeyed. (Cash services companies operate as middle men for commercial banks that don't want to hire tellers or own counting machines.) Anyway, PL probably would buy small bills from the Cash company because the drug business probably can't supply anything like the cash that a fast-food chain needs for the day-to-day.

Also, I haven't watched past mid-season 3, so if any of this is covered, well, okay then.
posted by Sunburnt at 3:18 PM on February 3, 2014


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