3 Steps To Take If You Get Sucked Into A Get Rich Quick Scheme

We all hope it doesn’t happen to us, but the fact of the matter is scammers are getting increasingly more clever, and schemes like old fashioned get rich quick are getting harder to spot. So let’s suspend disbelief for a second and say you did get caught in a get rich quick scheme, pyramid, ponzi, or otherwise, and now you’re looking for a way out. What do you do? Let’s take a look.

 

  1. Break Off All Contact

 

The first thing you want to do is secure whatever assets you have. If the scheme needed access to your bank account, whether for withdrawals, deposits, or something else, alert your bank, have your account locked down, and get your money somewhere secure. Cancel any credit cards to which they may have had access. Block their phone number from your phone. Do whatever you need to do to get what you have secure as fast as possible, and don’t let the company or person perpetrating the scheme know what you’ve done or why. The point is to get yourself as secure and far away from them as possible. Do everything in your power to get yourself secure as fast as possible. Then gather any information from your old accounts (deposit records and things of that nature) and get them ready for step two.

 

  1. Gather And Report Data

 

Once you’ve got yourself secure, you’re going to want to get all the information you’ve been given, any contact, promotional info, receipts, bills, invoices, statements, sales info, even copies of things like text messages and screen caps of web pages compiled and ready to present. The more data you have, the better. Take all of that and prep it for submission to a local authority, such as your local Attorney General’s office or tax office. Exactly who you should talk to depends on what type of scheme you got caught in, but you should absolutely let someone in a position of authority know, and provide them with any information you can that may help them track down the scammer. Even if the company is legitimate, their questionable actions could prime them for a class-action or civil lawsuit.

 

Alternatively, if you found out that the company was operating illegally, you may want to pursue litigation of your own. In that case, you’re going to want to get an attorney on your side quick, preferably one that specializes in a subject related to the scheme in which you were caught.

 

  1. Set A Plan For Recovery

 

If you have any major losses, now is the time to start thinking about recovery. Work with a financial planner to help you build a smart savings and investing plan to get back your losses, and be specific about working with trusted names and established brands in any applicable investment. It will take time, but you can get back what you paid in, as long as you’re diligent about your savings and spending plan.

$25 Million Dollars Has Been Recovered From Billions Owed In Ponzi Scheme

A settlement was made by Bernie Madoff’s investors that is earning back the money owed by his famous Ponzi scheme. The Ponzi scheme is considered that it is one of the largest financial frauds in the history of the United States. Madoff was the former NASDAQ chairman who now sits in a federal prison in Butner, North Carolina serving out his 150 years. Madoff plead guilty to the scheme in May of 2009. It’s surprising that he was able to steal that much money before anyone caught on.

 

Madoff owes over 17 billion dollars due to Ponzi scheme. He even had his family involved in the scheme. He falsified trading reports to his clients and put the money they invested with his company into a Chase account. Many New York companies chose not to invest with him due to the suspicion that his numbers did not add up. There were many investigations by SEC already in the works prior to his sons turning him in.His brother Peter has been sentenced to ten years in prison. Madoff confessed to son’s Andrew and Mark that “everything was a lie” His son Mark committed suicide two years after the arrest of his father. His other son Andrew has passed away after battling lymphoma.

 

Irving Picard is a trustee overseeing the liquidation of Bernard L. Madoff Investment Securities LLC, the former company of Madoff and family. In 2009 Vizcaya was sued by Picard in bankruptcy court. Court documents state that Vizcaya had invested over $327 million dollars with Bernard L. Madoff Securities LLC just eight years prior. Vizcaya removed $180 million in their account a few months prior to the demise of Madoff’s Ponzi scheme. Court documents again state that the funds were then hidden in British Virgin Islands and Cayman Islands. Surely they could not file for bankruptcy with millions of dollars hidden in investments around the world.

 

There have been many lawsuits surrounding the Ponzi scheme with banks and investors. In order to receive the recent amount returned the lawsuits had to be dropped in exchange. The settlement is to be reviewed at a hearing in Manhattan on  January 27, 2016.

 

Makes people wary about investing any of their money with investors anymore. So many firms have shown to be untrustworthy. Yes it may take years to catch on to them committing fraud and even longer to get the money owed back. So far in Madoff’s case a reported $11 billion has been returned out of the $17 billion plus owed. It’s not like he will be needing any of the money while sitting the rest of his life in a federal prison. Going from a respected NASDAQ chairman to a white collar criminal. Money will make people do crazy things even when they know it is wrong. It’s sad story regarding his family and how his greed tore his family apart and more than likely led to the death of his son.

 

What You Should Understand About White Collar Crimes

When you think about a legal term that is broad, you think about white collar crime. It goes beyond a wide range of non-violent criminal offenses. These crimes will typically involve fraudulent activities such as credit card frauds, bank frauds, money laundering, trading inside, forgery, identity theft, forgery, and social security fraud. The federal and state lawyers take this crime very seriously and will prosecute to the full extent of the law.

On the Scene

In 1939, Edwin Sutherland, a famous sociologist was the one who first came up with this phrase, ‘white collar crime.’ The distinction was made between different crimes and the differentiation now had to follow where crimes like robbery, murder and burglary could not be in the same class because they were classified as blue collar crimes that can cause bodily injury. White collar crimes, though not physically related can also injury individuals and society at large, even more than blue collar crimes. It appeared in most cases that the court system treated offenders of white collar crime with more compassion. However, that is debatable.

Financially Motivated

Most white collar crimes are motivated by money with the intention of taking finances from another person and in most cases, the person may be an elderly, disabled or financially uneducated. In many instances, this crime is committed by someone of high social status and respected by peers. It is never usually the lay person. As society evolves, the defining boundaries that separate white collar crimes and corporate crimes have been blurred. These days, however, corporate crimes are monitored by government regulations.

Illegal Offenses

The terminology of white collar crimes is usually intended to classify the offender. The Department of Justice calls these crimes non-violent offenses of illegal actions, which involves manipulation, trickery, deception, ploy, breach of trust and deceit. The various white collar crimes include:

  •       Fraudulent misrepresentation of facts in order to force certain individuals to make a bad choice in investment.
  •       Corruption where someone gives a gift to a person of influence in exchange for favor or use of influence
  •       Embezzlement, which is hiding funds discretely for themselves
  •       Someone inside of a company such as an employee shares stock trading information
  •       Fraudulence where someone uses the Internet to steal another’s personal information such as a bank account or password
  •       Money laundering

The most common white collar crime is embezzlement. This criminal offense occurs when an individual uses dishonest means to handle money that has been assigned to their care and responsibility. This will usually happen when an employee mishandles funds from a corporate account and spends it for personal gain. Another common white collar crime is fraud, which could include healthcare fraud, mail fraud, credit card fraud and insurance fraud.

 

If someone notifies you that law enforcement is investigating you for a white collar crime, seek legal counseling from a criminal defense attorney immediately before speaking to law enforcement. Under the Miranda Rights Act, you have that right to speak to a lawyer first.

 

Street Gangs Drop Drugs To Turn to White-Collar Crimes

An increasing number of street gangs can now be observed migrating from the drug business to other white-collar crimes. Take for instance, the Van Dyke Money Gang in New York, which gathered more than $1.5 million this year through the Western Union money order scheme.

 

Or, how over hundred Neighborhood Crips are minting endless cash by making dozens of fake gift cards for supermarkets, pharmacies and hardware stores in New Jersey. They even made money out of tax returns. Four of the twelve were charged with murder and with an attempted murder in separate incidents and both the cases are still pending.

 

At the same time, the so-called, Outlaw Gangsta Crisps in Brooklyn managed to make more than $500,000 in a paycheck fraud scheme, which typically involved obtaining a legitimate pay check and accordingly using it to further create and cash phony checks before they were caught.

 

An increasing trend of street crews and gangs earning unaccountable money through white – collar schemes like identity theft and credit card fraud can slowly be observed. In fact, Florida has reportedly charged over four hundred people for causing a loss of up to one forty million dollars. Most of them, as what is observed, are members of gangs. A trial to these members is scheduled for any time early next year.

 

Moreover, as  an increasing number of gangsters are engaging themselves in white-collar frauds, a decline in the cause of turf wars can also be seen.

 

Al Pasqual, director of fraud security, at Javelin Strategy and Research, a leading consulting firm in the U.S., said, “Why would you spend time on the street slinging crack when you can get 10 years under federal minimums when in reality you can just bone up on how to make six figures and when you get caught you’re doing six months? For some, it’s a supplement. They’re earning the money to grow the other side of their business, using white-collar crime to fund gun running. For a lot of them this becomes their day to day. They travel the country when they get really good at it.”

 

These crimes are very organized in nature, wherein the crew actually recruits bank account owners to help them pose as holders of phony checks that can be subsequently cashed. They later on pay off the crooked employees and buy identities online.

 

Bill Maddalena, assistant special agent in charge of the white-collar branch of the Miami FBI office, said, “They’re very well organized. They have to recruit people to help steal devices, cash the checks. There’s still an element of violence, there’s less head-to-head competition. They’re attacking the government.”

 

What’s more? These crime lords have become consistent in what they do. If they are cracked down for one type of scam, they come up with another almost immediately. Since, they are born and raised in a computer aged technological environment, they know and understand how one can make use of it, especially in their own favor.

 

House Bill to make it harder to prosecute white collar crime

Law

White collar crimes are ones that are financially motivated, and nonviolent. These types of crimes are usually committed by business or government officials. Because these crimes are nonviolent in nature, some believe that they should not be treated as harshly, when it comes to prosecution. House Republicans unveiled a bill, which would eliminate a number of white collar crimes, when the crimes are merely reckless, negligent, or grossly negligent. This bill would actually make it harder to prosecute for white collar crimes.

 

Criminal justice reform

There has been public debate over the criminal justice, and how sentences should be reduced for nonviolent drug offenses. Because of overcrowding prisons have developed into a huge problem throughout the nation, this change might reform the criminal justice system. A bill would use a “three strikes” rule of life imprisonment for those who commit nonviolent drug crimes.  Judges would be given the flexibility to alter mandatory minimum sentences. White collar crime do not fall far behind when it comes to this criminal justice reform. Actions that led to the financial crisis were the fault of multiple business owners, however these people were not imprisoned for their actions. Why continue to overcrowd prisons with white collar criminals? The House Judiciary Committee will take all of this information into account, as they begin creating the criminal justice reform package.

 

What a passing bill would mean

Putting this bill into place would make it more difficult for federal authorities to pursue executive wrongdoing for white collar crimes. These crimes can range from financial fraud to environmental pollution.  The Senate Judiciary Committee approved a similar reform legislation in October, but did not include white collar crime prosecution. White collar decriminalization supporters are pushing for a “mens rea” reform. This means that the defendant can only be convicted of a crime, if there is intent. Currently, prosecution against those who have committed negligent or reckless behavior is permissible. The new House legislative bill would require that these offenses have intent, and that executives were aware of criminal activity being conducted by employees in the workplace. Prosecutors would even have to prove that an executive was aware of illegal activity going on.

 

White collar crimes rarely pinned on big executives

Adding white collar crime to the criminal justice reform bill would be beneficial since corporations already tend to diffuse responsibility for illegal activities. This already makes it difficult for prosecutors to prove executives knowingly violated the law. According the Brandon Garrett, a law professor at the University of Virginia, executives usually don’t take the fall in corporate crimes anyway. The blame is usually placed on a lower level employee, who is then charged for the crime.

 

Is it better to give white collar criminals a slap on the wrist and call it a day? Many think it is unfair for white collar crimes to go unpunished. With the amount of violent crimes, overcrowding prisons, and money & time it costs for prosecution maybe the new bill, making white collar crime harder to prosecute, isn’t such a bad thing after all.

 

Medicare Fraud

Why should you care about Medicare fraud? After all, what’s the big deal about losing few dollars here and there in such a massive government program?

In fact, some people might try to tell you that Medicare fraud is the only way for physicians to be fairly reimbursed for their time attention in caring for some of our country’s most vulnerable people.

But they are wrong. Runaway Medicare fraud costs taxpayers hundreds of billions of dollars each year. If you are a taxpayer, you are on the hook for part of that bill.

Medicare is a government health insurance program for U.S. citizens aged 65 and older, and for people under age 65 who have certain disabilities. It covers hospitalizations, medical treatment and prescription drugs.

It is a massive program covering millions of Americans and used in nearly every community in the country. Because of its size and the sheer number of people participating in the program, it also can be particularly vulnerable to fraud and abuse.

The types of Medicare fraud are limited only by the human imagination. Some common types are medical providers improperly coding claims in order to get Medicare to reimburse claims that are not covered, or performing unnecessary services in an attempt to rack up the charges. Providers might double bill their services to private insurance and to Medicare, or unbundle services that normally should be charged as one group of services in order to jack up the prices. Medical providers have gone as far as to falsify patient records, documenting phony tests, visits, treatments and services that never happened in order to cash in on the taxpayers’ dime.

Some providers have been caught taking kickbacks from drug company representatives for writing unnecessary prescriptions, or from specialists for making referrals for further testing or treatment when they aren’t warranted by the patient’s condition.

Physicians aren’t the only ones who commit Medicare fraud. Medical suppliers, individuals and other companies all have been caught trying to take advantage of the system. Some people will steal others’ Medicare numbers in order to rack up phony charges. That’s why it’s important to always check your Medicare Summary Notice or similar statements to be sure that services aren’t being falsely charged to the government using your name and account.

Anyone can report Medicare fraud, and whistleblowers who do so are protected by law from any retaliation for their actions – whether it be from their employer, a medical practitioner or other provider. Not only that, you may be eligible for a reward of up to 30 percent of the recovered funds, if your report leads to a conviction of Medicare fraud.  You can learn more about how to prevent, identify and report Medicare fraud at the government’s Medicare web site: www.medicare.gov or by calling 1-800-MEDICARE.

If you do get fired from your job for making a good-faith report of potential fraud, you are eligible for reinstatement and damages, including double back pay, with interest, the costs of litigation, attorney fees and hardship compensation. An employment attorney can advise you about the details.

Alleged White Collar Criminals Walk Due to Dropped Insider Trading Charges

Law

Over the past six years, the government has been cracking down on insider trading on Wall Street. But U.S. Attorney Preet Bharara will not win this one, not after the government has declined to hear an appeal for an overturned court decision that has freed multiple individuals from their previous convictions. Michael Steinberg, a former hedge fund manager for SAC Capital along with six others who had previously pled guilty to insider trading charges, will walk free.

Steinberg’s Scheme

Steinberg managed SAC Capital’s Sigma Capital Management Unit, specifically managing stocks in the technology, media and communications sector. He was convicted in 2013 of insider trading and sentenced to 3 ½ years in prison.

Steinberg, along with Anthony Chiasson and Todd Newman, two other technology hedge fund investors, were accused of passing along tips about technology companies to their bosses in order to maximize the returns on stock investing. Altogether, the funds Steinberg managed accrued over $1.8 million in profits.

New Ruling in the 2nd U.S. Circuit Court of Appeals

Chiasson and Newman were tried and convicted in 2012, but the ruling in an appellate court overturned these original convictions. The 2nd U.S. Circuit Court of Appeals decided that insider trading can only be found if the defendant knew that they received their information from someone who was required to keep the data private, but would personally gain by leaking the information. Passing along simple tips isn’t enough to gain a conviction – prosecutors must provide facts about the inside source and prove what the defendant knew at what time.

Newman, Chiasson, Steinberg and six others who had originally pleaded guilty as government witnesses will all walk free, with all charges vacated. Attorney Bharara states that further pursuing charges against them “would no longer be in the interests of justice.” While it is extremely rare for courts to let those who have pled guilty walk free, it does happen on occasion when the initial subject is cleared of their charges.

How Will This Precedent Affect Wall Street?

Bharara has led the charge against corruption on Wall Street, targeting consultants, insiders and fund managers. Of the 87 convictions gained during the past six years, 14 have been vacated either due to an appeal or dismissal.

It remains to be seen whether the new ruling by the appellate court will affect any other pending cases, but it will definitely make it more difficult to charge individuals for insider trading and hold up the charge with enough data and witnesses over the course of a trial.

Will this decision affect how Wall Street workers act? While many believe this ruling is a severe blow to the side of the prosecution in their efforts to limit insider trading, hopefully insider trading is still considered a risky, dangerous and illegal move and many are deterred by the government and Bharara’s persistence to keep pressing on despite changing guidelines presented by the appellate courts.

Is Japan’s Monetary Easing Policy Working?

Over the last half-century, Japan has definitely proved itself as an economic power to reckon with. Its vehicles, machines, and electronic equipment are among the finest in the world, and we consume them happily here in the US. Americans are in constant awe of Japanese innovations (just think of the traffic-directing robots).

Unfortunately, it isn’t sunshine and rainbows all the time. Even Japan has to make tough calls regarding fiscal policy.

That was the case in 2013. In order to make Japanese products more competitive overseas and to stimulate domestic consumption, Japanese Prime Minister Shinzo Abe pressured the Bank of Japan (BoJ) to begin a policy of monetary easing—printing more money to create inflation and devalue the national currency.

The strategy behind the Abe administration’s agenda is simple: by devaluing the yen, the price of Japanese exports in foreign countries should go down. Thus, consumers in those countries are more likely to buy. Also, a diminished yen should produce lower interest rates, leading to increased bank lending and consumer spending.

Response to Abe’s initiative was mixed, but the BoJ followed the directive after the Prime Minister threatened to change the laws under which the nation’s central bank operates.

So how did that work out for Japan?

According to plan, apparently.

From the beginning, the result of the monetary easing was a significant devaluation of the yen to the dollar, accompanied by a rise of the stock market (NIKKEI).

Mere days after Abe announced his plan, the NIKKEI jumped 234 points. Meanwhile the yen fell to a 33-month low.

The initial fear surrounding the issue was that Japan’s move would spark an international “currency war.” When any given nation lowers its currency, it has the potential to threaten the exports of other countries unless they do the same. The problem is that when everyone starts doing it, international trade takes a beating, which is what happened in the 1930s.

Fortunately, the nations of the G-20 decided from the outset to not take any such action. The G-20 nations have a collective understanding to not participate in competitive devaluations, and they weren’t going to break it for Japan’s relatively small-time action.

Those trends have continued over the course of the last two years. The NIKKEI has seen a steady rise to 25,000 points. Just compare that to the 11,000 it was at when the BoJ began the monetary easing in early 2013.

Meanwhile, currency depreciation has continued. While this has the potential to continue stimulating the Japanese economy as originally planned, it can have negative effects if not controlled. About 9% of Japanese imports come from the US—a value of $73 billion dollars. This includes billions of dollars worth of oil, meat, pharmaceuticals, and aircraft equipment. As the value of the yen goes down relative to the dollar, these goods will become more expensive for Japanese citizens and businesses.

Although Japan is currently enjoying the benefits of monetary easing, it’s yet to be seen whether the current policy will prove a help or hindrance to the country.

 

Did Donald Trump Run a Scam University?

Wealthy CEO turned-celebrity-turned-presidential candidate, Donald Trump, has been accused of many things; from racism and sexism to bribery. But the most recent allegations and lawsuits circling the celebrity businessman are about Trump’s “scam” university.

New Lawsuits Against Donald Trump Allege He Scammed His Students

A new class-action lawsuit in California and an ongoing civil suit in New York against the now-defunct “Trump University,” later known as “The Trump Entrepreneur Institute,” claims that Donald Trump defrauded as many as 5,000 of his students. Many angry students have accused the entire operation of being a scam from the beginning.

The victims paid up to $35,000 each to learn the secrets of Trump’s real estate investment techniques and strategies, and learn how to become successful entrepreneurs and business leaders; as Trump had promised that anyone could do. But these students never received the education they said they paid for.

According to the National Review, one couple, Shelly and Richard Hewson, paid $21,490 for what they thought would be classes that would teach them how to buy and “flip” houses for profit. But a Trump University instructor took them out to look at a couple run-down homes in a bad part of Philadelphia, made a few general statements, and never actually explained how to find properties to buy or sell.

Trump University Relied on Donald Trump’s Image, But Failed to Deliver Results

The Hewsons are irate that they paid so much money to an institution that didn’t deliver what was promised. They claim that they and the other 5,000 students are victims of Trump’s scam. What prompted them to spend so much money on these scam classes? “Because we had faith in Donald Trump,” Richard explains in his 2015 affidavit against the Trump Entrepreneur Institute.

Hewson goes on to say, “We realized that Trump was not teaching us how to find these needles in a haystack. We concluded that we had paid over $20,000 for nothing, based on our belief in Donald Trump…”

The Trump Institute promised that everyday Americans could achieve wealth and success if they followed his tips for real estate investment and business strategies. But more students of Trump’s university are coming out against the billionaire as victims of his scam organization.

Trump’s University Ruled to Be “Operating Illegally”

Between 2005 and 2011, Trump’s organization earned $40 million in revenue from students who bought into Donald Trump’s personal image and brand. In October of 2015, a New York trial court ruled that both the organization that is Trump University as well as Donald Trump himself were liable for restitution for every students who had taken the course since May 2010, “because it was operating illegally without a state license.”

While this ruling was easy to make based on the evidence, it may prove difficult for the victims to win a case against Trump on only the claims that they never received the education that was promised when they paid their many fees. But there are accounts of the aggressive tactics used on the victims at these Trump University seminars.

‘Aggressive’ Tactics Allegedly Coerced Students Into Paying Thousands

According to New York State’s complaint, “Trump University speakers repeatedly insinuated that Donald Trump would appear at the three-day seminar, claiming that he ‘is going to be in town’ or ‘often drops by’ and ‘might show up’ or had just left.” There would be a fleet of salespeople milling around, convincing students to pay an additional $1,495 to attend a special three-day conference. Many students were eager to sign up, including the Hewsons.

For an additional $34,995 students could sign up to join Trump’s “Gold Elite Program.” But the cases against Trump allege that the victims who paid the money never received the insinuated or promised results. The New York State case alleges that some students emptied all their savings or went heavily into debt to cover the cost of Trump’s classes. But instead of receiving Trump’s advice, students were allowed to take a picture with a cardboard cutout of Trump and were then persuaded to charge more money onto their credit cards.

The Trump Institute Is One of Several Recently Highlighted Falsehoods

Trump University was one of many of Donald Trump’s failed enterprises that quickly went bankrupt and left a wake of unsatisfied customers, including his many casinos in Atlantic City. With the increased press surrounding the businessman’s intent to run for President, other aspects of Trump’s business dealings have been more closely inspected, including the possible hiring of illegal immigrants on his construction projects.

In a recent press release, Trump said his net worth was $10 billion, but Forbes magazine has pegged it at just $4 billion. Earlier this summer, a California federal judge ruled that Donald Trump has to testify about both his fraudulent claims about his net worth and his earnings from the real-estate classes, alleging that the blatant lies about the numbers persuaded the student victims to invest in his classes, only to be scammed.

The lawsuits are a combined result of several students’ claims of the Trump University being a scam and the state finding the university to be operating without a license and with fraudulent and exaggerated claims. But as Hewson says in his affidavit this January, “We never tried to get our money back because at that point we thought the whole thing was a scam and that we would not be able to fight Donald Trump.”

Chinese Money Laundering in A Neighborhood Near You

Last December, a Chinese buyer dropped $51 million on a Vancouver estate, making it the most expensive property sold. And in just the first half of the year, the Chinese have spent more than $3.8 billion on Manhattan real estate, more than triple what they spent in all of 2014, according to data from Real Capital Analytics.

The foreign investor boom in high-end property in cities like San Francisco, New York City, London and Vancouver in the last few years is a boon to real estate brokers and developers. Overpriced properties are no longer a problem—marketing them to a wealthy Chinese buyer is the solution for a quick, all-cash sale.

These type of sales are creating a housing boom. While the perceived boom offers signs of an improving economy, the reality is the opposite. Foreign property investment is affecting property values in top US and Canadian cities and it’s pricing out local residents who can’t afford to pay top dollar to compete. Many of the purchased properties sit vacantly. Analysts wonder how long the market can sustain inflated prices before the bubble bursts. The more relevant and concerning question is how are Chinese investors funding the bubble?

A Bloomberg report found that “China’s foreign-exchange rules cap the maximum amount of yuan that individuals are allowed to convert at $50,000 each year and ban them from transferring the currency abroad directly.”

Despite these caps, China tops the list of developing countries sending illicit money abroad, according to a study by Global Financial Integrity. Illicit money out of China topped $2.7 trillion for the decade ending in 2010. That doesn’t bode well for Chinese policymakers trying to boost China’s rapidly slowing growth. Clearly things are serious enough—China devalued its currency in August by 1.9 percent against the dollar in the biggest single-day markdown since 1994. The attempt appears designed to curb capital outflows from China, but is a 2% devaluation enough to stop the funneling of billions dollars? Unlikely, when you consider a Barclay’s poll that found that nearly half of Chinese millionaires plan to emigrate in the next five years.

So how are Chinese millionaires and billionaires doing it? In several ways. The largest institutions responsible for capital funneling are the Chinese banks themselves. Some allow money to leave China while looking the other way, although the Chinese government is making this less likely with a public crack down on corruption. More “reputable” banks have loopholes that allow a Chinese national to physically open an account in Hong Kong, where unlimited money can be wired. There is often an intermediary money exchange service that exchanges the currency into US dollars to deposit into the Hong Kong account.

Hong Kong money services are feeling the Chinese government crackdown pressure and making the Hong Kong solution inconvenient. The newest laundering option is the controversial Bitcoin, which has seen a sharp rise in Chinese momentum in the last couple of years. Bitcoin is a digital currency that operates independently of a bank.

Traditional investors that find Bitcoin too esoteric get money out of China by not bringing it in, in the first place. Many businesses avoid the money exchange inconvenience by accepting payment in foreign currency like US dollars or Euros exclusively to their worldwide banks of choice.

For now, it’s a battle between government regulation and money preservation. It looks like the Chinese millionaires and billionaires are winning by creatively finding ways to pull their money out of China and investing it in offshore havens like your neighborhood. Get ready for a bumpy ride.