I'm not GP, but your condescending attitude is not only rude but wrong.

Money laundering through things like app sales is a classic technique. It's the modern version of buying "art" that isn't valuable at insane prices. Laundering through an app store incurs a 30% haircut, but the funds are very clean afterward and every money laundering technique is going to cost that much or more. It is not unusual for the laundered funds to be 40% of what they started with.

Pointing out that money laundering is a possibility is fair. I very much dislike Apple, but if it is a potential money laundering situation then their hands have been tied by the US government.

You're really out of your element here.

>It's the modern version of buying "art" that isn't valuable at insane prices.

That was possible because the art world (at some point in time) enabled this. Apple and its App Store actively prevent this from happening, it's the complete opposite.

Step 1: Create an app and put it in the app store.

Step 2: Generate a bunch of fake accounts in many different countries, and fund them with the dirty money.

Step 3: Have all these accounts buy the app. Make sure you don't have them all buy it at once, or otherwise have a suspicious purchase pattern.

Step 4: Collect the (now clean) funds from the app store,

Okay, how does Apple "actively prevent" this? They don't have to enable anything.

Here's the difference,

In the art world there is (or at least, was) some level of secrecy in the transactions and parties involved.

Apple would give up all information it has about you to law enforcement at the slightest suspicion of some shenanigans happening. They also comply with all KYC requirements from the law. That's how (among other things) they "actively prevent" people using their platform for criminal activities. Heck, at their scale, they must have an entire team devoted to doing just that.

You've unfortunately been breaking the site guidelines very badly lately, such as here and (even more) here:

https://news.ycombinator.com/item?id=38396197

https://news.ycombinator.com/item?id=38395956

https://news.ycombinator.com/item?id=38395894

If you keep this up, we're going to have to ban you. We've already had to warn you about this more than once in the past.

If you'd please review https://news.ycombinator.com/newsguidelines.html and stick to the rules when posting here, we'd appreciate it. That means no more swipes or name-calling, and definitely no more personal attacks.

My apologies, you're right.

I'll tone it down.

> Could you enlighten us? How does one launder money through some iOS apps?

You use stolen credit cards to purchase the app. It's a very common method of fraud and does not require a criminal mastermind or a group of people to perform.

I have no opinion on what happened in this particular case, but it's crazy to imply that nobody is doing this stuff.

You answered to the wrong comment maybe?

Because that is not money laundering.

> that is not money laundering

I’m willingly jumping into a hornet’s nest, but out of genuine curiosity, why?

Money laundering is not "making money through illicit means" as many people confuse it with. Money laundering is the act of concealing that money, so that it becomes clean money in the face of any curious observer. They often go hand in hand but they are different things.

An example, you have 1M cash but you need it in your bank account, because you want to buy a house or a car or groceries. If you just go to your bank with 1M in a briefcase a lot of people are going to ask you "where did that money came from?". But if you do ???? and you have a legit (or legit enough) excuse for that, you may get away with it and now you can use your money and people think you're a mastermind entrepreneur or something.

There's a reason why the first money launderers were laundromats and similar businesses, anything with plausible cash flow, because then you can go to the bank and tell them "I just run a very successful laundry business, and that's why I have a big bunch of $10 and $20 bills, some of them may have a bit of blood in them, though". Much more complex ways exist but the gist of it is this.

If you take legit money from someone's bank account, move it through Apple, then send it to Chile(?), then take it out(?) that's literally the opposite of what you'd like to achieve, hence why this argument is so absurd.

> Money laundering is not "making money through illicit means"

This is correct.

> Money laundering is the act of concealing that money, so that it becomes clean money in the face of any curious observer

This is the middle step, layering. Before that is placement, introducing the funds into the financial system; after, integration, withdrawing clean money.

Here, stealing the credit cards is the original crime. That per se is not money laundering. Running them is analogous to placement. Mixing those stolen numbers with people who legitimately forgot to cancel their subscriptions is layering. Getting a bank deposit from Apple: integration. (Banks won't question deposits from Apple.) That process, altogether, is absolutely money laundering.

The stolen credit cards are actually irrelevant. If the developer's dirty sources need to layer their funds, they can subscribe to the app and have it laundered for a meagre 30% haircut. Do that across a number of assumed identities and it's a decent cottage money-laundering operation.

> it almost always involves putting cash into a bank account

It very rarely does anymore. Certainly not at scale.

>it almost always involves putting cash into a bank account

Yeah, I edited my comment shortly after but you were already writing this probably.

Only an observation, it almost always starts as money flowing into a bank account, though.

>If the developer's dirty sources need to layer their funds, they can subscribe to the app and have it laundered for a meagre 30% haircut.

No, because you cannot pay for apps with cash. If you already have cash into a bank account somewhere in the world then ... you most likely don't have the need to conceal it anymore. Buy shitcoin, send it to a tax haven, whatever, why would you make it dirty again by sending it to (of all damn options) Apple. Lol.

A (stolen) credit card isn't cash. The whole operation here is to turn someone else's credit line into usable funds.

But also, why would sending funds to Apple make them dirty? That doesn't make sense—as GP pointed out, sending funds to Apple so that Apple sends those funds back to you is what makes the money clean. It's the difference between depositing $50k in your bank account from a drug deal and getting a $50k direct deposit from Apple's developer program. The latter won't raise a single eyebrow.

>sending funds to Apple so that Apple sends those funds back to you is what makes the money clean

No, because it is extremely easy for anyone to see that these funds came from an illegal activity, Apple would just say "these were stolen credit cards" within hours of it happening. That's the literal opposite of concealing the origin of money.

> If you already have cash into a bank account somewhere in the world then ... you most likely don't have the need to conceal it anymore

This is where you’re going repeatedly wrong. Most money laundering doesn’t involve cash.

If you embezzle funds, or defraud an investor, you wind up with dirty money in a bank account. While it’s there, it’s hot. You could do the crypto trade, but you’d still be in a position of holding cash (even in a tax haven, depositing loads of cash is expensive) and/or having a tainted account.

Running it through Apple yields a bank account tied to a developer entity that receives deposits from Apple. You can leave your money in that account without too many worries for extended periods of time, and produce KYC receipts to wary counterparties when asked to. That’s valuable.

It sounds like you have no idea what money laundering actually is, to be honest. Money laundering is concealing the source of illegally obtained money.

You use stolen credit cards to buy gift cards (or just defraud people to obtain gift cards). This is dirty money.

You pay it to yourself on the App Store by getting an app listed and buying it. Apple then deposits money (minus their 30% cut) in your bank account, which is clean money.

How is that not money laundering?

The stolen CCs are not part of the laundering (that's just fraud/theft). I think it's easier to talk about laundering cash from drug sales. You buy an Apple Gift card with the cash. Use the gift card to buy jewels in an app you control, and now you have cleaned your drug money.

The challenge with doing this at scale on the App Store is the account requirement. Apple also likely has controls on how many gift cards you can redeem over a period of time. You also need an app that looks plausibly functional. The amount of money people supposedly spend on gems or whatever will help though.

That's the dumbest way one could launder money. You left a trace everywhere and the vast majority of people with money taken away from their accounts are going to tell their bank that same week. You literally triggered all the alarms. Then it gets sent to your Apple developer account? The one that has your face, your name, your bank details, etc...

Wtf man, use your neurons a bit.

Wait, your argument is

"this suspension by Apple couldn't be due to Apple catching them laundering money"

because

"this isn't money laundering"

because

"if someone laundered money this way, they would get caught"?

Do you not understand that you just destroyed your own argument?

And I have inside knowledge that you're wrong at least much of the time. This particular case, I have no idea, but extremely competent teams inside FAANG believe that there are many billions of dollars of attempted money laundering of this form, that they catch and stop.

> That's the dumbest way one could launder money.

So now you’re admitting the scenario I proposed is money laundering.

Have a nice day :)

It's not, that's just regular racketeering.

You didn't even get the nuance of my sentence there, it's like if you draw a computer in a piece of paper and you tell me "it is a computer", then I tell you "welp, then that's the shittiest computer I've ever seen" and you're like "hurr durr, you see, it's a computer". Lol.

I can now see clearly why you are just unable to grasp the concepts discussed here. :)

How would you get the money you possess and want to launder on the stolen credit card? That more sounds like a method to extract money from stolen credit cards, but not a valid way to launder money.

> Could you enlighten us? How does one launder money through some iOS apps?

It’s super obvious, but here you go:

Step one: Trick old people into sending you iTunes gift cards or buy iTunes gift cards with stolen credit cards

Step two: Get an app in the App Store and use the iTunes gift cards to buy it many many times

Step three: Receive 70% of the money you laundered through the App Store from Apple. Pay taxes on it, and you’ve got clean money.

Funny how a "super obvious" thing is out of your reach, though ...

That is not money laundering.

Come on guys, read a bit, don't just parrot back what you see on Netflix.

There are "companies" in developing countries that you can send money to who, if you send a large enough amount, will create and publish an app on the app store in your name and use a portion of the funds you give them to purchase stolen credit cards and/or apple store gift cards (usually obtained by some form of credit card fraud), and make purchases of that app, thus washing your original dirty funds.

This is money laundering.

You can also just buy mass amounts of stolen credit cards that have some moderate odds of successfully accepting some number of small ~$100 charges, so you can just do all this yourself. And folks do.

Nope, that's still not money laundering.

If you obtain funds illicitly and transmit them round-trip through a 3rd party, lossily, such that the 3rd party and any outside observer such as the government are unaware that you are both sides, you are laundering money.

But please tell me what money laundering is and is not. It's not like I have a close to a decade of real world experience in an industry whose primary goals include combating it and working with relevant authorities.