500 euro note - why criminals love it so

http://news.bbc.co.uk/1/hi/8678979.stm

by pier0 • 16 years ago

47 25 16 years ago

news.bbc.co.uk

Retric2• 16 years ago

I love how forcing them to replace 2 bags of 500 with 5 bags of 200 is supposed to impact organized crime.

hugh32• 16 years ago

Ian Cruxton of Soca says that's entirely what investigators expect the gangs to do - but there are reasons to be optimistic because they're trying to disrupt the "business practices" of organised crime and force gangs to make mistakes.

It makes life marginally harder for 'em. Instead of walking around with a briefcase you're suddenly walking around with a suitcase. Instead of having to get one guy you really trust to carry the money you have to get two guys you really trust to carry the money. It's twice as hard to hide your huge cash wad when you travel through customs. Mostly though, the main goal is probably just to annoy them.

Retric2• 16 years ago

The main goal is probably just to annoy them.

The problem is it annoys everyone that deals with significant quantities of cash. I keep cash on hand just in case a bank glitch messes with my checking account. Forcing me to keep larger bills reduces my available hiding places and makes it easier to rob me.

PS: I suggest most people without significant debt keep 2 weeks living expences (food/fuel/etc) in cash just in case.

WillyF• 16 years ago

I worry that it won't be long before governments criminalize cash. They want to track everything (for a multitude of reasons ranging from taxes to criminal activity), and cash inhibits this.

splat2• 16 years ago

I remember hearing about a movement in Japan to eliminate cash a while back. (Here's one story from about a year ago: http://business.timesonline.co.uk/tol/business/economics/art...) Has anything happened with this or was the proposal dead on arrival?

nostromo• 16 years ago

Even if cash stays with us for another 100 years -- inflation will make it more and more inefficient over time.

Eg.: around 1970 when $100 became the largest bill, it was actually worth about $500 in today's value. So, it lost 4/5 of it's real value.

If you look another 40 years out, $100 will become the new $20, the government will probably not have introduced any new bills, and the amount of transactions you can actually transact in cash will be even smaller.

sethg2• 16 years ago

I can’t remember the last time I bought something worth more than $100 by paying cash. If every bill with a denomination over $20 went away, or if inflation reduced the largest circulating bill to a value of twenty 2010-dollars, I wouldn’t notice.

Not to say that the government should eliminate the higher-denomination bills—just using myself as a data point to suggest there’s not much consumer demand for them.

euroclydon• 16 years ago

There has got to be some moral boundary on taxes. Most government are perfectly willing to cross that boundary. So I actually think that cheating the government of tax revenue can be okay in certain circumstances, but the government, if they could, would do away will all cash, and make all transaction electronic and auditable. Just look at that new regulation in the U.S. where you technically now have to issue a 1099 to anyone who you do more than 600 worth of business with... gas stations, retailers, etc.

stan_rogers• 16 years ago

This exactly parallels Canada'a elimination of the $1000 note, except that the largest denomination now in circulation is the $100 note. Adding an order of magnitude to the weight, bulk and inconvenience of cash transactions (along with requiring paperwork concerning bank transactions involving $10000 or more in cash) may not have done much about large-scale organised crime, but it certainly did make it more difficult to skirt the goods and services tax.

pmjordan• 16 years ago

So if the primary use of the €500 note in the UK is for money laundering... doesn't that make it easier for law enforcement, too? If they track down the movements of the notes, they should have few false positives.

shykes2• 16 years ago

Will cash be illegal in 10 years?

shykes2• 16 years ago

It's always a pleasure to have a friendly debate.

alexyim• 16 years ago

I don't see why they can't continue to do what they're doing and track big notes. If anything, reducing the size of the note would make it blend in with notes used for legitimate purposes.

Tracking 500 euro notes and finding criminal activity is a means of solving problems. Inconveniencing criminals isn't.

adbge• 16 years ago

Sounds like organized crime simply wants the largest note possible to reduce the raw size of their cash. Not sure how that translates to the fact that "Criminals love the 500 euro note."

xiaoma2• 16 years ago

I remember another high profile case in which Japanese criminals smuggled billions of dollars worth of T-bills. If high denominations of cash are crippled enough, more organized criminals may go that route.

http://www.bloomberg.com/apps/news?pid=20601039&sid=a62_...

500 euro note - why criminals love it so

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