This is especially true for drug traffickers who generally deliver their product on consignment. That is, suppliers are often not paid until after the drugs are eventually sold in individual use quantities on the street. This is why the world has attached heightened significance to the money laundering problem. For the purposes of this testimony, I will discuss the mechanics of money laundering using drug proceeds as my illustration of how the system operates. But it is important to keep in mind that this system functions equally well for gun and munitions merchants, white collar offenders, arsonists bent on defrauding insurance companies, tax evaders and many others.
Money laundering is a problem which transcends the narcotics industry.
It is an integral part of the operation of virtually all crime syndicates, and a critical aspect of tax evasion schemes as well. In a typical drug organization, the proceeds generated by the drug traffickers are almost entirely in the form of cash. The typical denomination of currency in street circulation is a twenty-dollar bill. Regularly, the volume becomes so large that it is easier for the trafficker to weigh the money than it is to count it. Handling this volume of cash is often a more serious logistical problem for the trafficker than the handling of the drugs themselves.