Mario 64 sells for $1.56 mil

[VideoGameCritic]

At this rate we're all going to be filthy rich in a few years.

[matmico399]

That's a game that only this guy in the VGC could afford.

[jon]

And you still can’t find Luigi

[goldenband]

I am, emphatically, not saying that the following statement has anything to do with this sale, which I'm sure is 100% above-board.

With that disclaimer: sometimes weird auction results are a giveaway that money laundering is involved. It happens constantly in the art world (paintings, etc.). I'm sure it's happened in the video game market too -- why wouldn't it? Collectibles of any kind are perfect for money laundering.

[ActRaiser]

I am, emphatically, not saying that the following statement has anything to do with this sale, which I'm sure is 100% above-board.

With that disclaimer: sometimes weird auction results are a giveaway that money laundering is involved. It happens constantly in the art world (paintings, etc.). I'm sure it's happened in the video game market too -- why wouldn't it? Collectibles of any kind are perfect for money laundering.

I wondered about that as well. So, for that to actually work the owner of the item being sold would be "in on it" and would get not only the actual price of the object plus a little extra juice for his part in this. Then a majority of the money paid by the "anonymous" buyer would then be handed back to him all cleaned up.

The part that I'm not getting is that the cash or online trade to purchase the item would still be dirty. Which would mean the auction house has dirty money coming in. Going out to the original owner it's all clean money. So, only the auction house is left holding the bag with the dirty, untaxable, ill gotten gains money.

I guess if the auction house doesn't care where the money is coming from and Uncle Sam doesn't either then it's a big don't care. It surprises me though that large items aren't flagged for review at least.

[goldenband]

The part that I'm not getting is that the cash or online trade to purchase the item would still be dirty. Which would mean the auction house has dirty money coming in. Going out to the original owner it's all clean money. So, only the auction house is left holding the bag with the dirty, untaxable, ill gotten gains money.

I don't 100% understand how money laundering works (which is probably for the best!), but I think there are two main options.

One is simple fraud -- to claim transactions that never happened, especially on products that cost a lot more than their raw materials. If you've ever been to a pizza place or sub shop that didn't have anything, it might have been a drug front, but can also be a phantom location where imaginary sales are tabulated to explain the appearance of cash. People will spend $100 on flour and other supplies, and claim to take in $1000 in revenue, but they had it already. The supplies are trashed, or repackaged and resold, or who knows what.

The other option is obfuscation and having as many layers of transactions as possible, just to make it impossible for investigators and forensic accountants to trace everything. My guess would be that the money-laundering taking place in the collectibles market is more along these lines -- that it's a later stage in the process, meant to be the third or fourth layer rather than the first.

And the nature of collectibles provides a ready excuse for why the difference between the purchase price and sale price can be so big. Same with real estate, BTW -- there's no doubt some money laundering going on there too!

[VideoGameCritic]

I tend to go with the simplest explanation being the most likely. A lot of people are rich, with more money that they know what to do with. We've seen a lot of this recently with the proliferation of NFTs; people purchasing next-to-worthless items for large sums of money.

[jon]

Just think if there was 1 cart with a playable Luigi. It could go for a billion dollars.