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Smooth Criminals

From the Wolf of Wall Street in New York to Jho Low in Malaysia, globalization unleashed a world of well-connected and superrich con artists.

The man responsible for what the FBI called the “largest kleptocracy case to date” threw himself a hell of a thirty-first birthday party. A grab bag of Hollywood party clichés, Malaysian businessman Jho Low’s 2012 Las Vegas bash included a bespoke aircraft hangar, a Ferris wheel, a cigar lounge, Cirque-du-Soleil-esque performers, “Oompa Loompa” impersonators, and booze served by gorgeous women clad in red dresses.

What the party lacked in creativity, it made up for in cash thrown down. As Tom Wright and Bradley Hope describe in Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World, dozens of A-list celebrities, including Leonardo DiCaprio, Jamie Foxx, and Kim Kardashian, came out, many of whom were paid big money to attend. Swizz Beatz, Kanye West, and Ludacris provided musical entertainment, with Britney Spears bursting from a cake to sing “Happy Birthday.” Jho Low himself was gifted a bright red Lamborghini by nightclub owners Noah Tepperberg and Jason Strauss, as a thank you for the millions of dollars he had spent in their establishments over the years.

Low Taek Jho, Wharton business school graduate and professional hanger-on, allegedly bluffed his way into the corridors of power in Malaysia and masterminded the theft of $4.5 billion from 1Malaysia Development Berhad, the state investment fund for which he served as unofficial special adviser. And he didn’t work alone. Low developed connections around the globe — with the likes of the now-former Malaysian prime minister, middling Saudi elites, washed-up rappers, and a dozen Goldman Sachs bankers — using them to successfully implement the swindle and stash the cash in offshore bank accounts.

Like Jordan Belfort, whose antics apparently impressed Low enough that he bankrolled the DiCaprio-led biopic Wolf of Wall Street, Low’s excesses caught up to him. Clued in by the Malaysian playboy’s extravagant spending and mysterious origin story, investigators eventually connected the dots, forcing him into hiding in 2019, where he remains to this day. But the significance of Low’s crime feels deeper to many observers. For Wright and Hope, “Jho Low’s story epitomizes the shocking power of those who learn how to master the levers of international finance in the twenty-first century,” indicative of a “failure of global capitalism.”

If the spate of books released in recent years is any indication, the sense that globalization and financialization have spurred an upsurge in transnational crime is widely shared. In The Laundromat: Inside the Panama Papers Investigation of Illicit Money Networks and the Global Elite, Jake Bernstein details just how easy it is for elites to hide their money, through a history of the now-dissolved Panamanian law firm Mossack Fonseca. For a relatively small fee, the company would set up an anonymous corporation in an offshore tax haven such as the British Virgin Islands or Bermuda, and for a little bit more, it would have one of its employees pretend to be the owner so the real money holder could remain a secret.

“Mossfon,” as it was affectionately called, was the company implicated in the 2016 Panama Papers scandal, triggered by the release of a trove of documents by an anonymous whistleblower detailing the dodgy financial dealings of the global elite. According to Bernstein, in its four-decade run, Mossfon alone “flooded the planet with more than 210,000 anonymous companies, trusts, and foundations” — all vehicles to help the wealthy hide their money.

Elites and corporations looking to hide their earnings are usually engaged in unethical but legal tax avoidance rather than illicit activities. But the secrecy afforded by this global architecture makes it difficult to tell the difference. Indeed, Jho Low, whose friends called him Panda in a nod to his “plump frame and cuddly demeanor” as well as his love for the movie Kung Fu Panda, was a relatively benign crook compared to many who employ “corporate service providers.” Guadalajara Cartel cofounder and “Mexico’s first narcotics billionaire” Rafael Caro Quintero was a Mossfon customer. Known for the gruesome torture and murder of undercover DEA agent Enrique “Kiki” Camarena in 1985, Quintero, like many other drug lords and mobsters, utilized the shadow banking structure to hide and launder dirty money.

The State of Crime

It is these criminal acts — drug dealing, sex trafficking, weapons smuggling, cyber scams — rather than Jho Low’s Cristal blowouts with Paris Hilton that usually occupy our mental slideshow of global crime. Indeed, the international crime boss has become a staple in the popular imagination. David Cronenberg’s 2007 film Eastern Promises captures the archetype, telling the fictional story of Semyon, a cultured Russian restaurateur who rapes and pillages, preying on the desperation of Eastern European women and the depravity of Western European men to line his pockets. Semyon and countless others like him, we’re told, were unleashed upon the world after the collapse of the Soviet Union, fueled by greed and anger, eager to bend the new rules of global capitalism to their advantage.

This is not just a Hollywood story. Bill Clinton’s 1995 speech commemorating the fiftieth anniversary of the United Nations charter warned of the dangers lurking at the end of history. While “the Cold War ha[d] given way to freedom and cooperation,” the “new forces of integration also carr[ied] within them the seeds of disintegration and destruction.” Clinton praised the wonders of free trade, fluid capital markets, and technological advance, but he worried that “new technologies and greater openness make all our borders more vulnerable to terrorists, to dangerous weapons, to drug traffickers.” He named new enemies — including “international criminals and drug traffickers who threaten the stability of new democracies and the future of our children.”

Misha Glenny, author of the best-selling book McMafia: A Journey Through the Global Criminal Underworld and dedicated cold warrior in his youth, echoes Clinton’s sentiments. In Glenny’s account, the “collapse of the Communist superpower, the Soviet Union, is the single most important event prompting the exponential growth of organized crime around the world.” The proliferation of failed states, Glenny argues, created a violent vacuum, a criminal “badlands” in which “economic survival frequently involved grabbing a gun and snatching what you could to survive.” In this worldview, modern international crime is largely a side effect of the headlong rush toward freedom and connectivity engendered by globalization and the chaos that resulted from the collapse of communism — a cancer we must root out so the market can function properly and the rest of us can prosper.

This Manichaean framing makes for a tidy narrative, temporally and otherwise, but it hides as much as it reveals. Cronenberg sheds some light on the matter. At the end of Eastern Promises, Nikolai, the undercover FSB agent who has successfully taken over the London bratva, broods in an empty restaurant, seemingly pondering the vicious crimes he has committed in the name of justice and whether he is, in fact, one of the good guys. His uncertainty is a helpful reminder of how state-making is intimately entangled with crime-committing, as much a part of global crime as the cinematic villains we hate to love.

In the Name of Capitalism

Crime is a trusted instrument in the geopolitical tool kit. Consider the Central Intelligence Agency, formed in 1947 out of the ashes of the Office of Strategic Services. The CIA is a shadowy government agency tasked with making the world safe for US-led capitalism. From its founding, it has pursued this mission by any means necessary, including the funding and facilitation of some of the world’s worst criminals and most heinous crimes.

CIA fingerprints can be found on criminal activity around the world. In the immediate postwar years, President Harry S. Truman was already channeling money through the CIA to fight communism in Europe. Alfred McCoy tells how in 1950 the CIA, through its intermediaries, hired a crew of local Corsican criminals to suppress a dockworker strike in Marseille. In solidarity with the Vietnamese communists fighting the French Expeditionary Corps, the dockworkers were refusing to load supplies headed for Indochina. In due course, the local mafia crushed the dockworkers’ strike, and, thanks to the CIA’s money and support, the Corsican syndicate forged a heroin production and smuggling operation in Marseille that thrived for decades.

In Vietnam, the CIA ran the Phoenix Program, an illegal torture and assassination effort. According to Sergeant Ed Murphy, a counterintelligence specialist interviewed by Douglas Valentine in The CIA as Organized Crime: How Illegal Operations Corrupt America and the World, “Phoenix was a bounty-hunting program, an attempt to eliminate the opposition, by which I mean the opposition to us, the Americans, getting what we wanted, which was to control the Vietnamese through our clients — the Diems, the Kys, the Thieus.” The undercover agents picked up anybody deemed a Viet Cong suspect, then tossed them into barbed wire cages too small to stand up in until they got around to interrogating and torturing them. Any Vietnamese person could be apprehended, for any reason. “Murphy told how one female suspect was raped and tortured simply because she refused to sleep with an agent.”

In the decades since the Vietnam War, kidnapping, torture, murder, and narcotics — with some blackmail thrown in — has remained the CIA’s go-to formula. An extremely short list includes Operation Condor, MK-Ultra, Iran-Contra, “enhanced interrogation” and death squads in Iraq, as well as black sites and “ghost detentions,” resurrected warlords, and more death squads in Afghanistan.

Do CIA agents and their shady international counterparts stand alongside Russian mobsters, Mexican drug lords, Israeli sex traffickers, and Nigerian cyber scammers in the global criminal lineup?

The crimes of the CIA are not a secret. They exist in a gray zone where enough people know about them that they can’t be denied, yet they are rarely, if ever, the subject of polite discussion and debate. The crimes of gangsters, drug traffickers, and embezzlers are set apart from the war crimes perpetuated by the US government. One set of crimes and criminals is defined as a problem to be eliminated, while the other is ignored and hidden — it’s not a crime to murder and torture as long as it’s in the service of American capitalism.

Muddy Waters

Adding the CIA and similar entities into the picture of global crime muddies not only our moral framework for categorizing crime but also how we imagine strategies to combat it. Granted, “cracking down” on crime demands an honest assessment of how crime, norms of morality, and the carceral state interact in the real world. The horrors of sex trafficking have been used by local law enforcement to push for longer sentences for sex workers trying to make a living. For decades, the so-called war on drugs has been used as an excuse to police and warehouse poor people, particularly people of color, and to justify repeated violations of other countries’ sovereignty. Decriminalization needs to be part of any conversation about crime, whether national or international.

The fact remains, however, that global crime hurts communities. Opioid addiction is directly related to availability. Unsuspecting women are swept up into an unending nightmare of sexual violence. Assassinations by shadowy government agents (and the military) wreak havoc, destroying the sense of safety and security that people need to thrive.

Jettisoning Manichaean narratives highlights how the structures of global capitalism that facilitate transnational crime, like the money-laundering infrastructure, are used by a wide range of actors, from narco-traffickers and mobsters to CIA agents, from major corporations to millionaires trying to hide money from their spouse ahead of divorce proceedings.

The CIA was an enthusiastic early adopter of the shadow banking system. According to Bernstein, by the early 1950s, the CIA needed a way to pay its covert operatives, and secret bank accounts proved to be the perfect thing. “In 1952, the agency’s disbursements had grown to such an extent that it became unwieldy to hand-carry the amounts of cash required. It needed a bank account that could be kept hidden.” So the agency set one up, using a pseudonymous account holder to hide the US government’s role.

Needless to say, there is very little appetite for eliminating tax havens and shadow banking. This doesn’t mean we shouldn’t try. By the same token, we should call out the CIA as the criminal organization that it is, loudly and often, and demand its immediate elimination, along with a public admission of its long list of crimes and misdemeanors.

But even if we were able to shut down tax havens and disband the CIA, there is a deeper challenge in tackling global crime. Crime is historical, integral to capitalism, and fueled anew each day by the logic of our global for-profit system. This is not to say that we should settle on the banality that capitalism is a violent system that begets crime — or the naive belief that, if we can just get rid of capitalism, we’ll eliminate crime. It is simply to say that if we truly want to reduce global crime, it is necessary to comprehend how the internal logic of our for-profit system continually re-creates the conditions for crime to thrive.

The Penthouse View

In pondering how it has come to pass that the great majority has “nothing to sell except their own skins” while a select few have wealth that “increases constantly although they have long ceased to work,” Karl Marx warned against the “insipid childishness” of bourgeois origin stories: “In actual history it is a notorious fact that conquest, enslavement, robbery, murder, in short, force, play the greatest part.”

“Primitive accumulation” isn’t relegated to the distant past — it remains an integral component of modern-day profit-making. As Jason W. Moore argues, accumulation in capitalism relies on constantly evolving combinations of exploitation (paying workers less than the value of what they produce) and appropriation (taking, often through violence, the fruits of labor and nature): “Absent massive streams of unpaid work/energy from the rest of nature . . . the costs of production would rise, and accumulation would slow.” Capitalism cannot survive by exploitation alone; profit-making requires appropriation.

These historically grounded combinations of exploitation and appropriation carve the landscape of global capitalism — a landscape fed by the currents of criminality that connect Montecito, Monte Carlo, and the British Virgin Islands to Tijuana, Chicago’s South Side, and Rio de Janeiro’s City of God. And it is in these latter peripheries that the greatest victims of capitalism’s crimes often reside — the “monetary subjects without money,” as Marxist philosopher Robert Kurz called them.

In his essay on Paulo Lins’s cinematic masterpiece Cidade de Deus, Roberto Schwarz discusses the “mesmerizing rhythm” of violence perpetrated by and visited upon residents of the Brazilian favela:

Events are portrayed on a grand scale, but the space in which they unfold is far more limited than the social premises on which they rest. The higher spheres of drug and arms trafficking, and the military and political corruption that protect them, do not appear . . . On their own patch — that of the excluded — the gang leaders are powerful figures, men with brains and hard experience who can withstand the highest levels of nervous tension. Yet they are still poor devils, dying like flies, far from the opulence the drug trade generates elsewhere.

The pitied victims of crime, and the mobsters and thugs who do the work of committing the crimes and often die “like flies,” are visible for our inspection and condemnation. Higher up the chain of appropriation, the elites who buy the coke, the venture capitalists who gamble the laundered money, and the elected officials who spend the bribes are much harder to see.

Reckless profligacy like that demonstrated by Jho Low can momentarily bring this world into view. But for the most part, the greatest beneficiaries of crime are blurry or invisible. From the penthouse, the violence and lawlessness experienced daily by those at the bottom are nothing more than evidence of a system working according to design.