MURCIA GUZMÁN and six others are charged with laundering narcotics proceeds through DMG and DMG’s affiliated companies, using the Colombian Black Market Peso Exchange, an informal value transfer system commonly used to launder illicitly-obtained dollars in the United States, in exchange for pesos taken in for “legitimate” purchases in Colombia. For example, in the fall of 2007, MURCIA GUZMÁN and co-defendant MARGARITA LEONOR PABON CASTRO, 35, approached another individual in Colombia and said that they had cash — apparently in U.S. dollars — that they could not deposit into the Colombian banking system. MURCIA GUZMÁN and PABON CASTRO asked the individual to set up an account in the United States where these funds could be deposited. Thereafter, the individual opened an account at Merrill Lynch in the United States, under the name “Blackstone International Development” (the “Blackstone Account”). Neither MURCIA GUZMÁN nor PABON CASTRO was listed as owners of the Blackstone Account.
In March 2008, MURCIA GUZMÁN and PABON CASTRO told the same individual that they had provided $2.2 million worth of Colombian Pesos to GERMAN ENRIQUE SERRANO-REYES, 45, in Colombia, and, in exchange, SERRANO-REYES had caused nearly $2.2 million to be wired into the Blackstone Account through 18 separate wire transfers.

I think the model was more along the lines of threatening the government out of investigating the fact that drug money was involved AND I think it had the affect (although not perhaps the original intention) of concentrating land into the hands of DMG as hundreds (thousands?) of farmers sold their farms and homes to dmg to invest in DMG.

Those seem to work if your goal is to launder a few million here or there. But what about hundreds of millions, or even billions? (At a time when the drug mafia is undergoing “generational change” and the paramilitary leadership was demobilizing?)

DMG was a pyramid scheme – the inducement to sign up friends makes that apparent. Someday in the future it probably would have collapsed. But I think it was a unique, hybrid pyramid scheme. Its imminent collapse was being delayed almost indefinitely by what appears to have been a steady flow of cash from a source other than its customers’ “investments.”

At what point would DMG have expanded so much that even drug money wouldn’t have been enough to sustain it? Who knows. The collapse was either just around the corner, or there was enough “dirty” money in the queue to keep it going for a while yet.