Did War on Drugs Lead to Surfside?

Wednesday, October 27, 2021

A lengthy and somewhat repetitive story from USA Today considers evidence that money laundering, necessitated by our country's ill-advised, immoral, and anti-freedom "War on Drugs" might have led to some of the design flaws and structural defects in Champlain Towers South, which collapsed in June:

Image by Marcello Casal Jr./ABr - AgĂȘncia Brasil, via Wikimedia Commons, license.
The reporting reveals for the first time that early condo sales exhibit telltale signs of a money laundering scheme. Experts said cutting corners on construction often accompanied money laundering. At Champlain South, engineers noted an incorrectly designed pool deck and improperly constructed support columns. Money laundering might have meant that some early buyers weren't living in the condo building or concerned with its long-term maintenance.

"The era we're talking about is when Miami suddenly came out of the ashes. So how do you rush to fulfill the demand? You cut corners. You attached roofs with paper clips. You bribe the inspectors," said Jorge Valdes, who was not involved in Champlain South but helped build dozens of homes, apartment complexes and high-rises in the Miami region as a chief money launderer for the Medellin Cartel. [bold added]
And later:
If they took part in money laundering in the sales, experts said, the developers were probably cutting corners on construction and anywhere else they could boost profits.
It is disturbing to contemplate that the artificially high recreational drug prices (and need to hide income from such sales) created by the War on Drugs might have led to criminals, with their short-range mentalities, becoming widely and deeply involved in the construction industry as this story argues.

Even if we assume that the story is sensationalizing the severity or extent of the problem and that it was not a factor in this particular disaster, it certainly stands as a plausible, cautionary example of the maxim Controls breed controls.

-- CAV


Greg said...

Based on my limited knowledge of money laundering, doing it with real estate seems unlikely. To my knowledge laundering goes like this: You have $500,000 in drug profits that you can't spend without being caught. But how do you "rinse" it? It starts by owning a strip joint or a bodega, or a casino, legitimate businesses that collect a lot of cash. Then you gradually add the drug profits to the daily deposits, report it on your income tax return, and viola! the drug profits (less taxes) are ready to be spent on your yacht or mansion.

Real estate is not a cash business. I'm not saying it can't be done, I just can't imagine how.

Gus Van Horn said...

Thanks, Greg. In support of your contention: Why haven't we had more collapses?

The way the interviewee spoke, the fact that so many buildings are still standing is near-incredible.