How the US is Using Money Laundering Laws to Imprison Political Dissidents
Political prisoners, in common parlance, are people imprisoned as a result of their political activity. Places such as Nazi Germany, the Soviet Union, and North Korea come to mind when we think about the practice. But more and more, the US is imprisoning people, as well as silencing speech, and telling companies who they can and can’t do business with for political purposes.
Probably the best recent example of US political imprisonment is also the most tragic. When internet activist Aaron Swartz committed suicide, he faced up to 25 years in prison for what appears to be a politically motivated crime. When Swartz downloaded files from online database JSTOR, there’s no indication the multi-millionaire intended to sell the files. In fact, JSTOR had little interest in pressing charges against him. But they ultimately complied with the prosecutor’s wish to make an example out of Swartz for his disregard for copyright legislation. It’s an open question whether the fact that Swartz led a successful crusade against additional, sweeping copyright legislation played any role in the prosecutor seeking unprecedentedly harsh sentence for the man not yet in his 30’s.
Besides imprisoning political dissidents who actually break laws, the Department of Justice has also begun punishing people its bureaucrats just don’t like. Take, for example, guns and pornography — two legal entities which are part of a DOJ list of “bad” businesses. Instead of outlawing these activities clearly and transparently, the DOJ is threatening banks with money laundering investigations in order to coerce them into cutting off services to disfavored customers. It’s called Operation Choke Point and the results have been exactly what you’d expect. Thousands of gun businesses and porn stars have lost their bank accounts, caught in the crosshairs of a political war.
When they’re not cutting off services, the government is suppressing disfavored speech by seizing web sites. Most recently, the FBI seized sex-worker support site My Redbook. The FBI regularly takes over websites, essentially taking property from citizens, before convicting them of any crimes. And like many instances, the charges include money laundering. Why, it isn’t clear, since the site mainly operated as a place for sex workers to share health and safety information and to find clients in a safe environment.
Money laundering itself is the victimless crime of sending or receiving money without telling government bureaucrats much about it. Laws against it were sold initially as add-on charges for prosecutions of mob bosses and crime ring participants. However, they’ve increasingly been used as primary charges for, essentially, earning or spending money in ways government doesn’t like.
Examples of this include alleged Silk Road head honcho Ross Ulrich and bitcoin entrepreneur Charlie Shrem. Both are in custody awaiting trial, Ulrich in jail and Shrem under house arrest, for no other crimes except money laundering. It appears the murder-for-hire charges were invented to conceal the political motivation behind Ulrich’s arrest, as they’ve since been dropped.
Again, both men appear to have been engaging in legal, but unfavored activity, at the time of their arrests. And both men are outspoken libertarians. Ulrich is accused now of narcotics trafficking, computer hacking, money laundering, and engaging in a criminal enterprise for his alleged involvement in Silk Road.
Silk Road is a website which removed the violence from the drug trade. It replaced broken kneecaps for bad user reviews, and in doing so helped reveal the futility of the drug war. But its shutdown revealed something even worse. In order to continue the rights-violating drug war which has created the world’s largest prison population, alienated communities from police, and created urban zones so violent they produce people with worse PTSD than is seen in people who serve in Afghanistan, the DEA shut down the safest way for people to buy and sell drugs.
The charges against Ulrich don’t even pass the common-sense test. He’s accused of running Silk Road, on which crimes might have been committed by other people. Running a website where narcotics are sold, computers are hacked, money is laundered isn’t selling narcotics, hacking computers or laundering money. So far the government has produced zero evidence Ulrich actually engaged in any of these activities.
There is nothing illegal about operating an online marketplace, nor should these marketplaces have to take on responsibility for the legality of each of the millions of transactions which occur on their sites.
Charlie Shrem is in custody for trading bitcoin for US dollars without the proper paperwork. Though he’s accused of laundering one million dollars, he’s unable to move freely. By contrast, megabank HSBC was convicted of laundering millions of dollars for known violent criminal gangs and terrorist organizations. They received a small fine.
Money laundering laws are not and never have been necessary, and are built on the troubling premise that we owe the government information about our money. Until recently, they were always used to help prosecute people for breaking other laws, mostly non-violent and victimless crimes such as illegal gambling and buying and selling drugs. That they’re now being used to punish dissidents for legal but unliked activity is evidence that they are not worth their cost in terms of enforcement or the erosion of our right to dissent.
The FBI, DEA, and DOJ must be reined in before we create more political prisoners and deprive more citizens of their right to free speech.