Back in 2010, when I was editor-in-chief of the high-net-worth finance magazine Spear’s, I received an invitation from the Jamaican government. Would I like to come to Jamaica for a week-long VIP trip to meet various ministers – tourism and finance – and stay in some pleasant beach hotels to write a piece? On the agenda was the slightly surprising fact that Jamaica’s capital, Kingston, wanted to reinvent itself on the global stage. Instead of being the murder capital of the world – daily shooting figures were published each day in Jamaica’s Daily Gleaner – the idea was to promote the island as an unlikely new international financial centre (ie a tax haven). The piece led to other similar government invitations: Cyprus, and then Malta, which was turning itself into the online gaming finance capital of Europe as host of the SiGMA Europe/Euro-Med offshore gambling conference. What I witnessed over my 15 years as editor of Spear’s was that Somerset Maugham’s famous description of Monaco – “a sunny place for shady people” – was hopelessly out of date. Now it is not just a few places but an entire global digital empire of shadiness. How to Launder Money, written by geopolitical adviser George Cottrell and US fraud investigator Lawrence Burke Files, two seasoned experts in the field of money laundering, is part financial history, part how-to guide and a compelling rollercoaster ride through the dark side of money over several thousand years. It is a cautionary tale for our times that deserves to be read by every OECD and Financial Action Task Force (FATF) employee and anti-money-laundering task force officer. To understand how the world of dirty money has been changed by digital opportunities, we need to go back a decade. In 2016, the Kenyan government came up with new legislation – helped to draft by the City of London Corporation – that would create a new “offshore” centre out of Nairobi, offering the equivalent of a money-laundering safari.

According to Nicholas Shaxson, investigative financial journalist and author of Treasure Islands: Tax Havens and the Men Who Stole the World, this legislation meant that anybody who leaked confidential information about the source of deposited money could be jailed for three years. The government wanted potential offshore clients to know that Kenyan bankers were “old school” – ie they practised the old mantra of banking secrecy for which Swiss bankers were known before they went OECD White List “transparent”. When the new laws were announced, the Kenyan investigative financial journalist and anti-money-laundering campaigner John Githongo described making Kenya a new tax haven as like creating a “financial crime aircraft carrier”. In short, this legislation was a classic example of how the darker underbelly of the global financial system has morphed in the last 20 years. When the old offshore money-laundering channels and routes are closed down, blacklisted or even “grey-listed” by the OECD – such as Liechtenstein, Monaco and Switzerland – new loophole opportunities open up. This point is repeatedly made with colourful historical examples in this book, which carries the subtitle “A Guide for Law Enforcement, Prosecutors and Policymakers”. Its subtitle could equally have been “The Men and Women Who Bent the Financial System”. It offers a unique chance for the lay reader to take a below-deck, captain’s-eye global tour of money laundering on board this so-called “financial crime aircraft carrier” as it cruises around the world, dropping anchor in all the least regulated offshore centres, from Turks and Caicos to Mexico. It is a chilling, eye-opening and fascinating read, and a classic new addition to the literary holy grail of “must-read” books on tax avoidance and money laundering. It immediately joins the likes of Treasure Islands, Misha Glenny’s McMafia: Seriously Organised Crime – turned into a hit BBC television series – and Felix Martin’s Money: The Unauthorized Biography. Russian money-laundering ingenuity is flagged up from the start, an area in which Cottrell has some practical knowledge from his former private “family office” career. Around a decade ago, with most Russians able to wire only up to $10,000 and government permission needed for companies to wire large sums, a loophole was found by Russian oligarchs to siphon billions of roubles out of the country – up to $80 billion – by rinsing the funds through corrupt Moldovan courts, opaque shell companies and complicit banks in Moldova and Latvia. This was facilitated by an elaborate spider’s web of seemingly clean companies registered in the UK, Cyprus and New Zealand. At the root of the laundering operation were fake promissory notes creating bogus debt guaranteed by Russian businesses. Another scheme exposed in the book is how Deutsche Bank, from 2011 to 2015, operated a “systematic money-laundering operation” using mirror trading, allowing Russian clients to convert roubles into real currency while avoiding scrut...