Meyer Lansky came up with the quote, We’re bigger than U.S. Steel. The we refers to organized crime.
Meyer Lansky (1902-1983), known as the “Mob’s Accountant”, was a major organized crime figure who, along with his associate Charles “Lucky” Luciano, was instrumental in the development of the “National Crime Syndicate” in the United States. The character Hyman Roth, portrayed by Lee Strasberg, and certain aspects of the main character Michael Corleone from the film The Godfather Part II (1974), are based on Lansky. In fact, shortly after the premiere in 1974, Lansky phoned Strasberg and congratulated him on a good performance (Strasberg was nominated for an Oscar for his role), but added “You could’ve made me more sympathetic.” Roth’s statement to Michael Corleone that “We’re bigger than U.S. Steel” was actually a direct quote from Lansky, who said the same thing to his wife while watching a news story on the Cosa Nostra.
At one time, U.S. Steel was the largest steel producer and largest corporation in the world. It was capitalized at $1.4 billion ($39.82 billion today), making it the world’s first billion-dollar corporation. US Steel was the second largest employer in the US in 1955.
Organized crime groups generate large amounts of money by activities such as drug trafficking, arms smuggling and financial crime. This is of little use to them unless they can disguise it and convert it into funds that are available for investment into legitimate enterprise. The methods they use for converting its ‘dirty’ money into ‘clean’ assets encourages corruption. Organized crime groups need to hide the money’s illegal origin. It allows for the expansion of OC groups, as the ‘laundry’ or ‘wash cycle’ operates to cover the money trail and convert proceeds of crime into usable assets.
Money laundering is a $500 billion to $1 trillion per year – so organized crime is bigger than the largest publicly traded corporation
In the US estimated figures of money laundering have been put at between $200 – $600 billion per year throughout the 1990s (US Congress Office 1995; Robinson 1996), and in 2002 this was estimated between $500 billion to $1 trillion per year (UN 2002). This would make organized crime the third largest business in world after foreign exchange and oil (Robinson 1996).
The rapid growth of money laundering is due to:
- the scale of organized crime precluding it from being a cash business – groups have little option but to convert its proceeds into legitimate funds and do so by investment, by developing legitimate businesses and purchasing property;
- globalization of communications and commerce – technology has made rapid transfer of funds across international borders much easier, with groups continuously changing techniques to avoid investigation; and,
- a lack of effective financial regulation in parts of the global economy.
Money Laundering is a three-stage process:
- Placement: (also called immersion) groups ‘smurf’ small amounts at a time to avoid suspicion; physical disposal of money by moving crime funds into the legitimate financial system; may involve bank complicity, mixing licit and illicit funds, cash purchases and smuggling currency to safe havens.
- Layering: disguises the trail to foil pursuit. Also called ‘heavy soaping’. It involves creating false paper trails, converting cash into assets by cash purchases.
- Integration: (also called ‘spin dry): Making it into clean taxable income by real-estate transactions, sham loans, foreign bank complicity and false import and export transactions.
SOURCES – Wikipedia