HOW McGEE COULD LAUNDER GANG MONEY

The Milwaukee Journal Sentinel noted today, Tuesday, July 1st, 2008, that jailed former alderman Michael McGee told a fellow inmate he used wire transfers to launder Vice Lords drug money. A headline referred to $15,000 McGee wired illegally to an agent to book rapper "The Game" [a.k.a. Jayceon Taylor] at the Rave nightclub. This transaction is similar to a concert money-laundering scheme explained to me by law enforcement officials about a year ago when McGee was first busted, and has been sitting in my files awaiting today's story.
The process is not exclusive to Milwaukee, is widespread, and explains how gangs, the music industry and the "don't snitch" counterculture are intertwined.
Generally speaking, a concert promoter with gang ties contracts to rent a concert hall for an evening at an agreed-upon rent. A performer or deejay, usually also with ties to the gang, is engaged for the evening's performance, and the event is promoted, usually by word-of-mouth and with inexpensive "rave cards" dropped off at suitable locations, announcing the event and its admission cost.
On the night of the performance, thousands appear for the concert, and virtually all are admitted for free as part of the scheme. (A few kids from the suburbs might pay to get in, but not many more.) Let's say that 2,500 people attend a concert in a large hall, with a list ticket price of $20, although most pay nothing. The next morning, the promoter makes out a deposit slip for $50,000 representing the night's receipts, grabs $50,000 drug money from under the mattress, brings it to the bank, and voilla! The money is laundered.
--Michael Horne