Money laundering

Neatly pressed lucre.

Dear Word Detective: I heard someone say that the term “money laundering” originated with Mafia ownership of laundromats in the United States. I think the speaker was clearly hitting the suds that day. Do you know when and how the term “money laundering” came to be? — Chris.

Oh boy, a Mafia question. Always fun. Back in the 1990s, I wrote a weekly column for the New York Daily News called “City Slang,” in which I answered readers’ questions about the rich and varied vernacular of the city. Since the Mob is a popular obsession in NYC, a lot of the queries I received were about organized crime slang I’d never heard, so I’d ask crime reporters at the paper and some retired NYPD detectives I knew if they’d ever heard the term. I also discovered that a couple of guys I knew knew guys who were “connected” in the Mob sense, and they’d ask around for me. More often than not, the search turned up bupkis, and I had to assume that the word in question was some screenwriter’s invention. It wasn’t a total wash, however. I did learn who to call if I needed somebody’s legs broken.

The verb “to launder,” meaning “to wash or clean,” is an interesting word. It first appeared in the mid-17th century, but the antiquated noun form “launder,” meaning “someone who cleans clothes,” dates back to the 14th century. The ultimate root of both words is the Latin “lavare,” to wash, which also gave us “lavatory.” But the word “launder” is actually a contraction of the earlier (and now obsolete) word “lavender,” which meant “a washerwoman” in the 13th century. Various theories have been proposed over the years attempting to connect this washing “lavender” to the shrub known as “lavender,” such as the aromatic flowers of the lavender being used to scent freshly-washed clothes. But it now appears that they are two completely separate words, and that the “lavender” shrub takes its name from the same roots that gave us “livid,” i.e., “bluish,” as are lavender blossoms.

The term “money laundering,” defined by the Oxford English Dictionary as “the process of concealing the origins of money obtained illegally by passing it through a complex sequence of banking transfers or commercial transactions,” seems to have first appeared in the early 1960s, though it only became widely known during the Watergate investigations of the 1970s, in which suitcases full of cash played a role in forcing the resignation of President Richard Nixon. While organized crime has long used legitimate businesses to “launder” dirty money, “money laundering” simply employs an established figurative use of “launder” meaning “sanitize, render acceptable” (“House votes to launder report before publication,” UPI headline, 1/30/76). So laundromats are not the root of “money laundering,” and I guess you’re right about the suds.

Although “money laundering” is nowhere near as intriguing as it should be (I’ve always pictured industrial Maytags full of cash), the practice has spawned at least one amusing term. In the wake of US law enforcement attempts to prevent money laundering by requiring any bank deposit of more than $10,000 to be reported to the government, criminals looking to hide cash began breaking up large sums into a series of small deposits, just under that limit, in different banks. By 1985, this tactic was known as “smurfing,” after the then-popular TV cartoon series The Smurfs, which featured numerous and highly-animated small blue people running around. It’s an inspired bit of slang for an otherwise dry and probably tedious activity (“To be more efficient, smurfs target areas where several banks are close to each other and, like most people, they avoid busy banks. ‘There is very little smurfing in New York City,’ says Charles Saphos, an Assistant U.S. Attorney in Florida, ‘because the lines are too long.'” Business Week, 1985). There are now laws against “smurfing,” which is more soberly called “structuring” by bankers. But I really like the sound of “Anti-Smurfing Law.”

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