Category Archives: FINANCE

Going by experience and common sense, it seems that there cannot be any human activity that does not expose the people involved in that activity to some form of risk or the other. Whether it is the common activity of taking food and the possibility that bits of it may get lodged in the windpipe, or it relates to taking a vital investment decision, everywhere we find that risk is unavoidable. Therefore, we can say, “risk taking is a way of life”. It is said: “ a person who does not take risk in life, risks everything in life”.

HSBC money laundering report: Key findings

From among these culprits there was one person whose name was Julio. According to investigating officers, Julio was principal to other culprits who was making the illegal money legal or in a process was involved in the process of money laundering.

It was said by special investigative executive James. The ICI agency is investigating this case. According to a lawyer from Columbia, Julio Chaparo was the middle man in this process of money laundering by these groups of people. The spokes person of HSBC said no comment in this issue. Till now it was not clear that drug traffickers were using as their payment gateway or not.

In the attorney office of New York and California, the secret report that specifically told how HSBC was used for drug is trafficking and money laundering. It was first traced by federal task force of South America, which analyses all wire transfers, e-mail, computer and other resources, how these money laundering and drug trafficking was taken place. In this way federal task force of South America knew the gang that was actively involved in money laundering and drug trafficking. This gang sells narcotics at America, and then the money gathered from this sell was sent to Mexico and then was deposited with HSBC bank there. It was being perceived that at Mexico, if you deposit a huge amount of money then no one suspect you, this is not the case at America so they chose Mexico for this. According to investigating officer of America, Chaparo and others drug traffickers and money launders, deposits all the money that they get from drug selling to Mexico HSBC bank. Then, they send this money to America and to some other places.

One member of that narcotic gang became a seller and they receive the offer from these members and they export all these electrical materials like that of computer and washing machine to South America. According to judiciary of America, due to some loop holes with HSBC transactions, these narcotics gang benefited immensely from this. At HSBC it was not been clearly investigated about the depositors, electronic wire transfer, and other money laundering issues. The task force that was investigating these narcotics group money laundering and drug trafficking issues started investigation of this issue from 2007. From investigation the executive came to light how courier companies from Miami and Houston , indulging sending these ill got money to south American countries. Then, they came to know how HSBC bank of Mexico was being used by these narcotics group and how this money comes again to New York, they knew it in detail.

He was active in spending the money that has been received through illegal drug sale. Fernado got his bail at the cost of two lacs as dollar. There was one criminal conspiracy case against him. Then, the investigative team stopped him and search and at that time from two bags he had 1, 53,000 dollars. Then the investigative team went to his apartment and there they found ledger and other important documents, and after analyzing all these it was understood that was the case of money laundering. Then, he was arrested, after interrogation, they knew about Chaparo and his way of doing these money laundering activities.

This was reported to justice department by investigating team. According to investigating reports, the federal agencies will be investigating about money laundering of HSBC Mexico to HSBC America , about huge sum of money , huge money , and it was said by the investigative agencies that , from 2008 April 5 to 2009 April 13 , with the sell of narcotics by these narcotics groups , then they gained huge money and these money were illegal and they money launder illegally through Chaparo and other narcotics groups.

Summary:

According to investigating officers, Julio was principal to other culprits who was making the illegal money legal or in a process was involved in the process of money laundering.

According to a lawyer from Columbia, Julio Chaparo was the middle man in this process of money laundering by these groups of people.

In the attorney office of New York and California, the secret report that specifically told how HSBC was used for drug is trafficking and money laundering. It was first traced by federal task force of South America, which analyses all wire transfers, e-mail, computer and other resources, how these money laundering and drug trafficking was taken place. In this way federal task force of South America knew the gang that was actively involved in money laundering and drug trafficking. This gang sells narcotics at America, and then the money gathered from this sell was sent to Mexico and then was deposited with HSBC bank there. According to investigating officer of America, Chaparo and others drug traffickers and money launders, deposits all the money that they get from drug selling to Mexico HSBC bank. Then, they send this money to America and to some other places.

At HSBC it was not been clearly investigated about the depositors, electronic wire transfer, and other money laundering issues.

Then the investigative team went to his apartment and there they found ledger and other important documents, and after analyzing all these it was understood that was the case of money laundering.

Sources & References:

https://www.fatf-gafi.org/faq/moneylaundering/

https://www.scribd.com/document/269977477/The-Red-Flags-of-Money-Laundering-and-Malaysian-Cases-on-Money-Laundering

https://legaldictionary.net/money-laundering/

Is money bigger than education?

At this weekends daddy has a lot of time and in the evening we all family have a seat at the balcony at a very brilliant cool weather and with some sort of breakfast we chat together. The climate is brilliant and with it we together began to talk on one subject after the other and then at one point of time and on one subject I could not recall immediately, the source of the conversation starts with and it is being first taken by mummy and then daddy get into discussion about is money bigger than education?

It seems to be a tricky one but it is a good subject and mummy stresses always about that education has always greater significance than that of money but daddy supported mummy’s suggestion but also said that it is now a concept which is thing of the past and in modern times it is the money that matters and education comes into back burner. It seems a bit of tricky situation and the matter and the crux of discussion goes on. It is for sure if you have money then you can share some of those as many said ill got ill spent but many people are spending in terms of benefits to others and so that they think God will always be with them if they had done any sort of wrong way in getting the money back.

There are also many examples can be taken into consideration , as with the real estate boom in housing sector where we can find lots of significance elements where the person without any sort of education and formal knowledge are getting richer day in day out and even they cannot speak but they are travelling all around with the main cause of money and this is surprising and on the other hand , there are also some cases when the person with gifted education qualities but it trying very hard but not earning any sort of money in the farthest of imagination. They are not getting any money with their education and they have been at the stringent end to meet their ends and these are very surprising and also painful but all have been true.

All has been of great significance where the old adage is simply fading into oblivion that money is the greatest wealth now wealth can get you education and certificates and this is the most damaging and bad side of any sort of money earnings. What these should be done and how these are happenings. There are many countries where the politicians with no knowledge and there are instances that they cannot even write their names but they are now more richer than even a highly educated person can aspire to be and these are all some sort of the way the world is heading into and all these aspects has been significantly very sort of most distressful anticipated.

The more you think on this subject the more you get entangled into all these and it is always better to have a good perspective and always on attitude but all have to be reached and concluded with the same sort of tag line that starts and ends with money. It is the money matter and if you have money and education then it does stick to you and with this you can rise higher but not higher than the person with money and no education. This is surprising but it is true , if you can venture to glance upon the real estate boom in some of the Asian counties you will soon realize and found that most of the major success of these are with illiterate who have ventured into all these and have successfully and sufficiently gained from all these.

It is true and if you follow the world headlines you can know from it and all these has been surprising and it is the most underrated and not so elegant part but it is true. The din and the bustle of real estate and the power that is inherent within all these has been the similar dream stories where not so educated persons has been getting the money and they are the real winner and mostly they are the champions of all cause in the society as they are simply distributing the money . These thoughts are like that of leaving from all sources but all has been some sort of greater significance that has been carried into where the educated person is always being harassed though they are not getting their due with due course of time and situations.

All these thoughts can be negated but when I realized that the taxi driver is highly educated person and then daddy on the way to airport surprisingly asked him why you have chosen this method, the response was he want to get to the top from the down side of the ladder though it is very technical but the education is being wasted here with full swing and part. This is not the only line that has been in the prominence there are several lines and the attitudes that meets and in this way the whole concept of education is diluting and these all making the mockery of education and if I am correct with some period of time people will question education and they will drive out and move beyond from these concepts and this can have some sort of humongous catastrophic effect and all these has been bad and going worse.

Take one example , there was the florist family , as they are very poor and even they do not have sufficient money for two daily foods and they have been living very miserably , they think that at some point of time education is important and that is why , they have been placing hard but after twenty and thirty years they are now one of the richest family as they are now importing and exporting flowers and these are very cash rich and they have been doing all these simultaneously and these proves the point that education does not matter to them to earn money it is the sheer mind that is getting them reach and now they are entering into real estate market as they have been richer and stronger and they can now have more and more power to exercise so much so that they will earn more money.

So, where is the role of education in all these aspects then? Is education is diminishing day by day as with this sort of education and writing can you earn more and all these has been getting into some sort of very dangerous trend where the education is slowly fading into oblivion and we are getting into that age of the history where once it has been called as the dark age is that sort of panel of thoughts I being rehearsed now a days things to ponder upon.

Slowly in money making and earning education has been limited and the role of education is not making you rich and known to all societies is not happening instead persons far more poorer than you is getting the limelight and money , a very serious trend and slowly can the education is getting out of hand . All these had obstacles to education can it jump all these hurdles to get back its number one position the time will tell for sure.

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Sources & References:

https://www.npr.org/2016/11/11/501165834/weve-always-had-a-seat-at-the-table-solange-on-conversations-that-heal

Basel Framework on Capital Adequacy or Measurement

Basel committee was established in the year 1974 by major economic powers. The main of establishment is to synchronise each financial and banking decisions into common ground of decision making. It aims to stabilise international currency management and secure each and every banking decision making process.

It is a collective decision-making process. Meeting held regularly since its first meeting in the year 1975. The committee can take decisions but these are not binding for member countries. It provides advises and provides valuable suggestions and helps in speeds up the decision-making process to a logical conclusion.

It provides adequate room for decisions by looking at each and every nation’s inline banking practices and then remove the obstacles which are common in every nation’s banking practices. The governors of each and every central bank of participating nations come forward and provide decision-making process.

Capital Adequacy Framework:

it all started in the year 1987 when the significant factors in decision making come across about reaching logical conclusion into the topic of capital adequacy. It is about capital measurements and member nations aimed to reach a standard point of view. Member nations also stressed the fact that the topic of discussions about capital adequacy or capital measurements needs to be changed through customisation of banking and financial environment.

Through 1991 and then on 1995 the more important stress on the factor in the presentations of devising how capital measurements can be at the state of bilateral relations and how can these perform in terms of competitive environments. In 1995 other than the known banking risks such as credit risk other factors of risks come into features and these are classified in the scope of market risks.

Market Risks:

Since in these times there is the competitive environment in terms of incoming of private banking industries and all of these comes in terms of the superior fascination of loans and provide enhancement of performance. With the advent of computerisation and efficient banking practices, the definition of traditional banking practices undergoes sea-change. Within market risks comes the bank’s international practices in managing foreign funds that pour into banks and the sources which at any point of time that needs to check and then get associations from major banking countries. It searches for any such rigidness that banking standards and practices perform and then try to solve this through consolidated discussions among member countries.

In the year 2005, it started another level or upgradation of capital measurements which were in application still the time from 1997. The new accord is constructed on the basement of three pillars approach to understand what were the main reasons for capital accord and how these are impacting the process of banking and financial decision-making process.

The first one is the minimum capital requirement for banks to operate in financing institutions. It needs to have its own capital in order to survive the struggle in the case inflations and other difficult circumstances. It is not put a stronger pillar for management but also it does not unnecessarily dependant upon outside resources.

In any financial institution, the prominent part is the risk factors. There are three risks such as credit risk, market risk and operational risk available. it was decided that the operational risks are variable. It can provide multiple endorsements of augmentation and speeding up market resources in making banking practices perform stronger. One example of the advent of core banking which at first considers by public sector banks as the most destructive element and can incur a higher amount of cost to the banking industries.

It is long term decision as it speeds up banking and enables customers to go for their devices without incurring additional resources. Shifts from legacy banking system towards modernised banking systems become easier as well as fast backing up and constant use of banking from different devices make it most suitable as well as cost-effective banking practices.

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difference between absorption costing and marginal costing

Inventory consists of assets to organisation. In the normal business environment it is there to sold to market.In the second category the throughput methods inventory gets ready to sell In the third alternative for the production of materials raw materials to the production material stays inside inventory.

Marginal costing is the cost incurred for inventory. Inventory consists of above three processes. Thus it might consists of more than one production unit.

Absorption costing is the cost incurred to all production units. Variable costs vary with costs. It varies with the volume of a production unit or attached services. If at all any point of time there is no production volume or services then the question of variable costs diminishes.

Under marginal costing which relates to cost differences the variable cost is applicable there. While calculating marginal costing only variable costs in terms of productivity and services is applicable.

Fixed overhead costs are opposite to variable costs and they do not vary remains constant. Management beforehand decides about the total aggregation of variable costs. From it, the constitution of contribution margin such as product price is made of. It minuses the variable costs to inventory in marginal costing. It includes fixed overheads plus contribution margin.

In absorption costing fixed overhead costs are applicable. While calculating total profits of the product, if it is going through marginal costing then it appears higher as the minuses of variable costing is not performed. While calculating profits under absorption costing, the fixed overhead minuses available costs so profit appears lower in this case.

Under marginal costing overhead costs are charged as expenses, in the case of absorption costing they are charged under products. Marginal costing is for internal management purposes they are not significant to show in accounting frameworks.

Absorption costing is included in financial reporting as it includes direct labor and direct materials that show how much exact amount is spent for productivity. Marginal costing includes factory overheads that do not include a practical production process that includes direct labour and direct materials of different units.

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