US government securities worth US 134.5 billion seized from Japanese nationals

bubblesmoney

US government securities seized from Japanese nationals

why the f*ck doesnt such stuff ever come to view first in the FT, bloomberg, bbc etc when it is of such a massive scale and in hundreds of billions of dollars worth.

got alerted to this via denningers website originally.



just 2 options as i see it

• forgeries - in which case of enormous importance due to the quality and amount
• real bonds and due to the huge amounts involved then a soverign like china or other big holder is dumping them to the shadow market to offload their dollar holdings off the radar and news isnt making it to big news channels as govts pressurising them to keep quiet as will upset the bond market if news of sovereign dumping of dollar holdings gains ground

i think 2nd scenario is more likely.

Italy’s financial police (Guardia italiana di Finanza) has seized US bonds worth US 134.5 billion from two Japanese nationals at Chiasso (40 km from Milan) on the border between Italy and Switzerland. They include 249 US Federal Reserve bonds worth US$ 500 million each, plus ten Kennedy bonds and other US government securities worth a billion dollar each.
Italian authorities have not yet determined whether they are real or fake, but if they are real the attempt to take them into Switzerland would be the largest financial smuggling operation in history; if they are fake, the matter would be even more mind-boggling because the quality of the counterfeit work is such that the fake bonds are undistinguishable from the real ones.
What caught the policemen’s attention were the billion dollar securities. Such a large denomination is not available in regular financial and banking markets. Only states handle such amounts of money.

purch

real bonds and due to the huge amounts involved then a soverign like china or other big holder is dumping them to the shadow market to offload their dollar holdings off the radar and news isnt making it to big news channels as govts pressurising them to keep quiet as will upset the bond market if news of sovereign dumping of dollar holdings gains ground

There is a 3rd option. (not involving any conspiracy theories)

They could just have been stolen :rolleyes:

bubblesmoney

purch wrote: »

There is a 3rd option. (not involving any conspiracy theories)

They could just have been stolen :rolleyes:

would still have been worth a mention by main news channels even if it was a theft when the value runs above a hundred billion dollars.

ruggedtoast

Good find OP.

tomterm8

If they are real, and they've been seized by Italy, does that mean they get to keep them? Did Italy just get enough money to repay its national debt?

dopester

Seems a bit unrealistic.

Biggest (honest) robbery with bonds I know of was the £292 million bearer-bond snatch in 1990 in London..... with a 58 year old lone bank courier mugged at knife-point on his walk across the City... carrying a case of Bank of England Treasury Bills and certificates of deposit from the banks and building societies.

"As good as cash to anyone holding them."

The mugger was later found dead, and the organising gang had already been infiltrated before the heist went ahead. All but a few 1m bonds recovered in the interception process, although some shooting executions along the way.

Generali

purch wrote: »

There is a 3rd option. (not involving any conspiracy theories)

They could just have been stolen :rolleyes:

That was my first thought.

Small beer compared to this lot but I once cancelled (I think) US$27,000,000-worth of bearer bonds. I asked what would happen if I stole them. My ex-Marine boss assured me I wouldn't make it as far as the door but if I did my biggest problem would be selling them as you can hardly take them in to NatWest and ask them to swap them for fivers.

Apparently one African bank would have been prepared to pay $10,000 for each $1,000,000 of face value.

Generali

PS It's on Bloomberg now:

http://www.bloomberg.com/apps/news?pid=20601101&sid=a3Yvk_JGbfL4

dopester

Generali wrote: »

My ex-Marine boss assured me I wouldn't make it as far as the door but if I did my biggest problem would be selling them as you can hardly take them in to NatWest and ask them to swap them for fivers.

Apparently one African bank would have been prepared to pay $10,000 for each $1,000,000 of face value.

Hardly seems worth doing for just $10,000 per $1million bond. That is theft. According to that newspaper cutting I kept from the 90s heist.

At 9:30am on 2 May 1990, John Goddard, a 58-year old messenger with money broker Sheppards was mugged at knifepoint on a quiet City side street. As on many previous mornings, Goddard was taking the same route carrying Bank of England Treasury bills and certificates of deposit from banks and building societies. The bonds were in bearer form and as good as cash to anyone holding them.

The mugger escaped with 301 Treasury bills and certificates of deposit, mostly for £1 million each. The total haul was £292 million. Within hours the Bank of England notified financial institutions around the world to be alert for attempts to cash or use the bonds.

Cheeseman confirmed that the heist of the century was far from an opportunistic street crime. `I knew it was coming off. I had 10 days' notice,' he admits. `I knew we would be offered the bonds.'

A veteran of two jail terms for fraud and with a degree in plausibility, Cheeseman, 51, is recognised by the police as a major league operator in the world of stolen and counterfeit securities. `I could shift it now, $200 million, $300 million, Cheeseman boasted, sitting in Manhattan's bleak Metropolitan Correctional Center. `It's so easy to put them down, You can get 60 per cent as collateral for loans.

Police believe the City mugging was carried out by Patrick Thomas, a petty crook from south London. Thomas was found dead from a gunshot wound to the head in December 1991. He was never charged with the robbery.

Cheeseman says his plan was to move the bonds through Indonesia. `I had already arranged it.' Because the Bank of England had acted so quickly it was necessary to try `far away so the banks would not be alerted'.

Stolen bonds are a highly perishable item. Those moving them must get them to a bank or broker before the word is out and they become worthless.

The police do not deny that their remarkable success in recovering all but two of the 301 bonds was due to an informant. Less than three weeks after the robbery, 86 Treasury bills and certificates of deposit were seized in Northern Cyrpus. Eight days later 80 bonds were seized at Heathrow. Another 15 bonds were retrieved in London during June. In July, 12 were seized in Germany. US Customs officers at Miami airport seized 70 stolen bonds destined for Peru. Smaller seizures were made in in Switzerland, Singapore and Holland.

Only two weeks after he started co-operating Osbourne was found in his car in Houston shot twice in the back of the head gangland style.

The Observer. 11th April 1993.

Generali

I remember it. HSBC led the banks in requesting the Bank of England to change the system of moving bonds around. The fear was a messenger would have his hand cut off.

inspector_monkfish

Generali wrote: »

Apparently one African bank would have been prepared to pay $10,000 for each $1,000,000 of face value.

that does not surprise me !!:eek: