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Vaknin, Sam, 1961-

"Crime and Corruption"

It is easy to recognize a laundering
operation. Its hallmark is a pronounced lack of selectivity.

The money is invested in anything and everything, as long as it
appears legitimate. Diversification is not sought by these nouveau
tycoons and they have no core investment strategy. They spread their
illicit funds among dozens of disparate economic activities and show
not the slightest interest in the putative yields on their
investments, the maturity of their assets, the quality of their
newly acquired businesses, their history, or real value. Never the
sedulous, they pay exorbitantly for all manner of prestidigital
endeavours. The future prospects and other normal investment
criteria are beyond them. All they are after is a mirage of
lapidarity.
The Investors
This is the most intriguing group. Normative, law abiding,
businessmen, who stumbled across methods to secure excessive yields
on their capital and are looking to borrow their way into increasing
it. By cleverly participating in bond tenders, by devising ingenious
option strategies, or by arbitraging - yields of up to 300% can be
collected in the immature markets of transition without the normally
associated risks. This sub-species can be found mainly in Russia and
in the Balkans.
Its members often buy sovereign bonds and notes at discounts of up
to 80% of their face value.


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