California woman sentenced for money laundering in local meth ring

By Jeff Reinitz

WATERLOO – A California woman has been sentenced to prison for running a money laundering operation as part of her husband’s drug ring that shipped meth into Iowa.

Judge Leonard Strand sentenced Janeth Amelia Pineda, 36, of Chula Vista, to three years in prison on Wednesday following a plea to one count of conspiracy to commit money laundering. She will be on supervised release for two years after she completes her prison sentence.

Her husband, Michael Pineda, 34, has pleaded guilty to money laundering and meth conspiracy charges and is awaiting sentencing.

Others indicted include Brandon Neil Harders, formerly of Waterloo; Samuel Arias, Michael Pineda’s stepfather; Robert Lewis of Janesville and Jeffery “Slim” Westberg, and authorities sought to seize Harders’ rural Gladbrook home as part of the investigation.

Authorities said Michael Pineda’s operation shipped ice methamphetamine from California hidden in auto accessory parcels destined for Iowa.

Janeth Pineda, instructed by her husband, opened accounts at Wells Fargo Bank that the Iowa meth customers would use to deposit drug money they owed the husband. The operation moved more than $370,000 worth of drug money in less than two years, according to prosecutors.

Court records state Michael Pineda traveled to Coralville in 2014 to deliver meth and met with Harders. After the meeting, police stopped Harders when he was traveling back to Waterloo and found about 3 pounds of meth.

In August 2018, Harders was sentenced to 11 years in prison following a plea, and Westberg was sentenced to seven years in October. A jury found Lewis guilty of meth charges conspiracy charges following a trial in August.

Venezuela’s ex-treasurer sentenced to 10 years for South Florida money-laundering scheme

By Jay Weaver

A former national treasurer in the socialist government of Venezuelan President Hugo Chávez was sentenced to 10 years in prison Tuesday by a U.S. judge for his central role in a $1 billion bribery and money-laundering scheme that enabled him to acquire luxury real estate and other assets in South Florida.

Alejandro Andrade, 54, sold access to the Venezuelan government’s lucrative foreign-currency exchanges both before and after Chávez’s death in 2013, enriching himself and an elite circle of other senior officials and a prominent businessman, according to court records.

U.S. District Judge Robin Rosenberg imposed the maximum sentence for Andrade’s money-laundering conspiracy conviction in West Palm Beach federal court, rejecting a proposal by his defense attorneys to give him seven years in prison for accepting responsibility for his crime in a plea deal. The judge did not impose a fine because Andrade has no money to pay one. He was allowed to surrender to prison on Feb. 25 instead of immediately because he has been assisting federal authorities in the massive corruption and money-laundering investigation.

Andrade apologized to the judge, his family and the Venezuelan people for his crime, and then described how he became involved in a “movement” led by Chávez that he believed would benefit his country. Soon, however, the national treasurer acknowledged that he betrayed the public’s trust.

“I made some very bad choices when I was treasurer, and for that I am very sorry from the bottom of my heart,” said Andrade, who served as the top financial official in Venezuela’s government from 2007 to 2010 before moving with his family to South Florida in 2014. “To this day, I am convinced the decision I made [to cooperate] is the right one.”

Before his sentencing, Andrade owned several properties in the wealthy equestrian community of Wellington in the western part of Palm Beach County. In a $1 billion forfeiture judgment, the U.S. attorney’s office and Homeland Security Investigations have begun the process of taking those tainted properties, along with his vast collection of high-priced cars, show-jumping horses and watches.

At Tuesday’s sentencing, federal prosecutor Vanessa Snyder said Andrade conspired with three other key players in the money-laundering ring by giving them access to the Venezuelan government’s favorable dollar-to-bolivar currency exchange. Snyder said the scheme generated about $2.4 billion in illicit profits for Andrade’s three co-conspirators and they agreed to share half of their money with Andrade while keeping it in European and U.S. banks.

“Mr. Andrade abused the trust of the people of Venezuela,” Snyder said, describing how his crime contributed to the longstanding economic crisis in the South American country. “The amount of money he agreed to receive was staggering.”

But Andrade’s defense attorneys, Curtis Miner and Bob Martinez, said the co-conspirators controlled the bank accounts and that their client received about $70 million in bribes — not $1 billion.

Andrade, who pleaded guilty to a money-laundering conspiracy charge last December, has provided insider information to Snyder and fellow prosecutor Michael Nadler to assist them in building a sprawling criminal case against some of Venezuela’s richest people. Among them: TV network tycoon Raúl Gorrín, 50, who was indicted last Monday, one day before the case against Andrade was unsealed in federal court in West Palm Beach.

The indictment charges Gorrín, a politically connected Caracas businessman, with conspiring to bribe Venezuelan officials and commit money laundering by hiding embezzled government funds in South Florida and New York real estate over the past decade.

The international money-laundering scheme allegedly led by Gorrín transpired over a period of extreme economic hardship for everyday Venezuelans. Oil rich and once wealthy, Venezuela is staggering under an economic collapse that has led to hyperinflation and food and medicine shortages. More than three million people have fled the country in recent years, according to the United Nations.

The national political coordinator for Venezuela’s opposition Voluntad Popular party, Carlos Vecchio, said Andrade’s web of corruption is tied directly to current President Nicolás Maduro and his wife, Cilia Flores.

“All of them are responsible for the deep crisis that Venezuela is living through,” Vecchio said in a statement, adding that the one billion dollars that Andrade amassed “is money that was stolen from the Venezuelan people.”

The South Florida probe of Andrade was first reported by the Miami Herald and el Nuevo Herald in March. Andrade, a former Chávez bodyguard who rose to become national treasurer, faced up to 10 years in prison under his plea agreement — substantially less prison time than Gorrín now faces as a fugitive wanted by federal authorities in Miami.

Andrade was staying at his equestrian farm in Wellington while assisting the feds in the case against Gorrín and others. In mid-November, federal agents seized his Wellington properties, including 17 prized show horses.

The warmblood horses, with names like Bonjovi, Hardrock Z and Tinker Bell, were imported from various parts of Europe, court records show. Andrade’s son, Emanuel, used them to compete in show-jumping events in South Florida and other parts of the world.

Agents also seized Andrade’s fleet of luxury vehicles, from a 2017 Mercedes-Benz GLS 550 to a 2015 Bentley Continental Convertible, along with numerous U.S. and Swiss bank accounts, and a vast collection of high-end watches.

Andrade, Gorrín and other associates in Venezuela’s government, banking and business sectors are accused of enriching themselves by capitalizing on favorable foreign currency exchanges and concealing their staggering profits in European and U.S. bank accounts and investments, according to Gorrín’s indictment. Andrade used his official position to give Gorrín access to the government’s preferred exchange rates to maximize profits on currency transactions. The funds to fuel the scheme were generated by the national treasury’s issuance of bonds.

Gorrín is accused of paying hundreds of millions of dollars in bribes to Andrade and another former high-ranking official in the national treasury office by funneling the money to them through a Venezuelan banker in the Dominican Republic. The banker, Gabriel Arturo Jimenez Aray, 50, controlled the Dominican bank with Gorrín.

Jimenez was charged with conspiracy to commit money laundering earlier this year, pleaded guilty in March and awaits sentencing on Thursday as he cooperates with federal authorities. He faces up to 10 years in prison. His defense attorney, Marissel Descalzo, declined to comment.

In addition to wiring millions through Swiss and U.S. banks to those two former high-ranking Venezuelan treasury officials, Gorrín paid for an array of lavish expenses for Andrade, including three jets, a yacht, champion show horses and high-end watches, according to Gorrín’s indictment and other court records. He even paid some of Andrade’s veterinarian bills.

Gorrín’s indictment and the cases against Andrade and Jimenez are unrelated to a $1.2 billion South Florida money-laundering case filed in July that charged nine defendants, including some close to President Maduro, with embezzling vast sums of money from Venezuela’s national oil company and washing it through foreign currency exchanges to inflate profits. Millions in ill-gotten funds were invested in South Florida’s real estate market, including luxury high-rise condos and waterfront mansions in the Cocoplum section of Coral Gables.

Two defendants in that case — Gorrín’s personal banker Matthias Krull and former Venezuelan national oil-company executive Abraham Ortega — have pleaded guilty to money-laundering conspiracy charges and are cooperating with the U.S. Attorney’s Office and Homeland Security investigations.

Gorrín, owner of the Globovisión network in Caracas, has not been charged in that case. He is suspected of steering $600 million from the country’s state-owned oil company, PDVSA, to a European bank to enrich himself, Maduro’s three stepsons and other members of Venezuela’s political elite, according to court records and multiple sources familiar with the federal probe in Miami.

Maduro’s stepsons and the president himself are also under investigation in that case.

Here’s how criminals use Bitcoin to launder dirty money

By David Canellis

Since 2009, estimates suggest criminals have used the hyper-connected cryptocurrency ecosystem to launder well over $2.5 billion worth of dirty Bitcoin $BTC▼1.83%.

Contrary to popular opinion, it’s actually quite easy to link Bitcoin transactions together in order to identify you. This should be obvious, considering public blockchains are totally transparent and browsable by anyone.

Still, dumb criminals are constantly caught for using Bitcoin in illicit activities.

This is because Bitcoin is not anonymous. In fact, there are barely any cryptocurrencies on today’s market that are capable of masking identitieswhen sending, receiving, and spending cryptocurrency.

So, ever wonder how these cyberbaddies are turning ill-gotten money, too sketchy for use in the real world, into clean cryptocurrency?

Let’s take a quick look at how they do it, for science!

Mixing services split up Bitcoin, only to reassemble it

Bitcoin mixers (also known as “tumblers”) purportedly clean dirty cryptocurrency by bouncing it between various addresses, before recombining the full amount through a Bitcoin wallet hosted on the dark web.

They’re a little painstaking to use, and definitely not free (standard fees will range from 1-3 percent of the cryptocurrency to be mixed).

You’ll need one Bitcoin wallet hosted on the ‘clearnet,’ (a fancy word for the standard internet). Also, you should open two or more Bitcoin wallets that run exclusively on the dark web (there are a few of these wallets available, but be careful!).

And of course, some Bitcoin to mix.

To start, Bitcoin is sent from a clearnet wallet to one of the hidden Torwallets. These kinds of transactions are called ‘hops,’ and can be done multiple times across dark web Bitcoin addresses, adding a layer of obfuscation with every ‘hop’.

With it stored on a dark web wallet, it’s time to run it through a tumbler. There are many mixing services that claim to be reputable, and charge various fees depending on the level of anonymity requested by the user, but it’s not up to me to show you where they are.

The tumbler will automatically split the Bitcoin up across multiple transactions, sending it at randomized intervals to enough Tor-hosted Bitcoin addresses that the ability to link the transactions together in a meaningful way is removed.

Once the tumbling is complete, the Bitcoin supposedly ‘clean’ enough to deposit on a cryptocurrency exchange to be traded for other cryptocurrencies, or even fiat.

It should be noted that researchers have studied these mixing services to determine just how effective they are. Unfortunately, they found even the most well-known and established ones had serious security and privacy limitations, highlighting the danger of using such services for criminal activities.

Bitcoin is easily laundered through unregulated exchanges

Unregulated cryptocurrency exchanges (those without Know-Your-Customer and Anti-Money-Laundering (KYC/AML) procedures, such as identity checks) can also be used to ‘clean’ Bitcoin, even without using a cryptocurrency mixing service beforehand.

This is done by simply trading the Bitcoin a number of times across various markets. For example, a user can deposit onto an unregulated exchange, swapping it for various altcoins.

Each time a trader exchanges cryptocurrency for another, they are adding degrees of privacy similar to ‘hopping’ between wallet addresses. Although, how effective this is depends heavily on the exchange’s monitoring technology, so this might not be a totally airtight solution.

The user can then withdraw their cryptocurrency to an external cryptocurrency wallet via other anonymous exchange accounts they own. Depending on the exchange, they could convert it to allegedly ‘clean’ fiat, but fiat markets on unregulated exchanges are hard to come by, and often shortlived.

Inevitably, money launderers turn to shady peer-to-peer markets and other nefarious deeds to turn their Bitcoin into cash. In 2016, Dutch police swooped on an international money laundering ring, seizing bank accounts, Bitcoin, luxury cars and ingredients for ecstasy.

Still, a few months back, researchers found unregulated cryptocurrency exchanges receive an overwhelming majority of the internet’s dirty Bitcoin. Even worse, the exchanges in countries where there is little-to-no AML regulations actually receive 36-times more Bitcoin from money launderers than those with appropriate rules in place.

Researchers estimated that after Bitcoin has been cleaned on exchanges, 97 percent of it ends up in countries with extremely lax KYC/AML regulations.

It’s also worth mentioning there are slightly less illegal (but still questionable) uses of these mixing services. In particular, regulated exchanges like Coinbase monitor their networks for possible interactions with prohibited cryptocurrency gambling sites.

As such, cleaning digital funds exposed to blockchain casinos before depositing to Coinbase and the like is an often-cited use-case, beyond the ultra illegal money laundering.

Man suspected of money laundering after $400,000 found in washing machine

By Tara John

CNN- The term “money laundering” was never more appropriate than this week, when Dutch police found around $400,000 stuffed inside the drum of a washing machine.

A man present in the house during Monday’s raid was arrested on suspicion of — yes, you’ve guessed it — money laundering.
Authorities were checking for unregistered residents in western Amsterdam when they found the load.
“The municipal administration revealed that no one lived at the address,” the police told CNN in a statement. “When the police did a search through the house they found €350,000 hidden in the washing machine.”
The police also confiscated several mobile phones, a firearm and a money-counting machine during the raid. The suspect, who is 24 years old, has not been named.
The police news release included a picture of bundles of €20 and €50 bills crammed into the washing machine.
They said in a statement that the raid was part of an investigation into “housing fraud, money laundering and other [signs] of crime.”

Feds tie another alleged $1B money laundering scheme to Porsche Design Tower, along with NY properties

By Keith Larsen

Federal authorities charged a Venezuelan TV magnate for his role in a billion-dollar money laundering and currency exchange scheme involving real estate around the world, including two dozen properties in Miami and New York.

The indictment follows a separate billion-dollar money laundering scheme in July that included real estate in South Florida. In that case, federal prosecutors say top Venezuelan officials siphoned funds out of the state oil company, and into assets throughout the world.

In both cases, some of the money is alleged to have been poured into two units at Dezer Development’s luxury Porsche Design Tower in Sunny Isles Beach.

In the most recent case, authorities are now seeking to seize 24 properties allegedly tied to billionaire Raúl Gorrín. Those residences also include luxury homes in Miami’s Cocoplum neighborhood and six in Manhattan.

One of the New York homes is a four-bedroom, five-and-half bathroom penthouse at 60 Riverside Boulevard; another is a unit in the Baccarat Hotel and Residences at 20 West 53rd Street, which last sold for $18.8 million.

The government alleges Gorrín, president of the news channel Globovision, bribed top Venezuelan officials to gain access to the country’s special fixed-currency exchange rate. Gorrin allegedly tapped into this special rate by bribing the officials with at least $161 million in contracts with Venezuela’s treasury department.

He also allegedly paid his co-conspirators with three jets, a yacht, multiple champion horses, and numerous high-end watches, according to the indictment, unsealed in U.S. District Court in West Palm Beach. He was charged with multiple counts of conspiracy and money laundering.

The indictment was filed in August 2017, but only unsealed Monday. As part of it, prosecutors unsealed cases against Alejandro Andrade, a former Venezuelan national treasurer who pleaded guilty in December 2017 to his role in the scheme; along with Gabriel Arturo Jimenez, a Venezuelan living in Chicago, and former owner of Banco Peravia bank. He pleaded guilty in March.

The condo in the Porsche Design Tower, unit 4406, was purchased in 2016 under pre-construction through a Delaware LLC called POSH 8 DYNAMIC for $12.8 million, according to Miami-Dade property records. The 6,121-square-foot condo has four bedrooms and four-and-half bathrooms and is a two-story penthouse, according to Realtor.com.

It is on the market for $9 million, or $950 per square foot, accordant to Zillow, and is being listed by Jill Eber of Coldwell Banker. The condo was previously listed for $13.9 million or $1,467 per square foot, in January. Eber did not immediately respond to a request to comment through a spokesperson.

In July, federal prosecutors sought to seize a different condo in the Porsche Design Tower, alleging a money laundering scheme that involved Venezuela’s state oil company, PDVSA. That larger alleged scheme also included assets spread throughout the world. In that case, prosecutors allege Porsche Design Tower unit 2205  was one of the assets bought by the former general counsel to Venezuela’s oil ministry for $5.3 million, and used as a fee to pay an alleged money launderer.

About that case, Dezer Development’s Gil Dezer has said he never met the buyer of unit 2205 and has cited the Fair Housing Act as a requirement to sell when a buyer signs a contract and sends over a deposit. Housing authority and anti-money laundering experts have disputed this interpretation of the Fair Housing Act.

In November, Matthias Krull, a wealth manager with the Swiss bank Julius Baer Group, was sentenced to 10 years in prison for his role in that scheme, after pleading guilty in August.

Gorrín was not a defendant in that case, but the Miami Herald — which first reported on the most recent indictment — reported that he is suspected of moving $600 million from PDVSA, to a European bank for his own benefit as well as other members of Venezuela’s elite class.

Gorrín’s attorney, Howard Srebnick, did not immediately return a request for comment. Dezer Development also did not immediately return a request for comment.

U.S. prosecutors accuse Venezuela media mogul of bribery, money laundering

By Luc Cohen

(Reuters) – The U.S. Justice Department has accused a Venezuelan television mogul of bribing officials in the South American country and helping them launder the funds through assets in the United States, according to charges made public this week.

Raul Gorrin, owner of Venezuelan television channel Globovision and insurance firm Seguros La Vitalicia, was charged in an indictment unsealed on Monday in federal court in West Palm Beach, Florida, with violating U.S. anti-corruption laws in efforts to win contracts to carry out currency exchange operations for the government.

The indictment was filed under seal in August after prosecutors said it was necessary to protect the “integrity of the ongoing investigation.”

Gorrin was declared a fugitive in September, and the charges were unsealed on Monday after prosecutors said it would help law enforcement arrest him, court records showed.

Venezuela’s exchange controls, created under late President Hugo Chavez, have for 15 years sold heavily subsidized dollars through state currency agencies or government auctions.

But dollars on the black market have fetched at least double and sometimes 10 times more, allowing the well-connected to buy cut-rate dollars and resell them at a huge profit.

The mechanism has been one of the principal forms of illicit enrichment under the ruling Socialist Party. U.S. federal prosecutors over the last year have issued a string of indictments of Venezuelan officials for using the U.S. financial system to launder the proceeds of those operations.

According to the indictment, between 2008 and 2017, Gorrin facilitated more than $150 million in bribe payments to multiple officials in Venezuela’s treasury for the right to participate in the currency deals. Much of the money was wired from Swiss bank accounts to accounts in Florida, prosecutors said.

Gorrin, 49, allegedly also bought officials jets, yachts, “champion horses” and luxury watches in Florida and Texas.

A biography on Gorrin’s personal website describes him as a salsa-loving “humanist,” lawyer and businessman. He bought a 25 percent stake in an insurer that would later be known as La Vitalicia in 2008, 10 years after Chavez came to power.

Globovision overhauled coverage and softened criticism of Chavez’s successor, Nicolas Maduro, after Gorrin purchased the channel in 2013, reporters said at the time.

Neither Globovision nor La Vitalicia responded to requests for comment. Gorrin’s defense attorney, Howard Srebnick, did not immediately respond to a request for comment.

Gorrin’s whereabouts were not immediately clear. He faces a maximum penalty of 45 years in prison if found guilty.

In a separate case last month, a former finance executive at Venezuela’s state-run oil company PDVSA pled guilty to taking bribes and attempting to launder $12 million of the illicit payments, the U.S. Attorney’s Office for the Southern district of Florida said.

Olivet charged in $35 million money laundering scheme

By Nina Schutzmann

Olivet University and several of its top executives have been indicted in a $35 million money-laundering scheme, according to the Manhattan District Attorney’s Office.

Olivet, a San Francisco Bay Area evangelical college, owns the former Harlem Valley Psychiatric Center in Dover.

The defendants are accused of fraudulently obtaining millions in financing under Olivet’s name, and laundering the money to obscure its origins and fund operations there, the prosecutor’s office said.

The Christian college “denies the charges … and will vigorously defend itself against these unsupported allegations,” spokesman Ronn Torossian wrote in an email to the Poughkeepsie Journal.

Defendants in the indictment announced Thursday include Olivet; Andrew Lin, chairman of the Olivet board of trustees; Lingyi Xiao, Olivet’s finance director and dean of its business school; and William Anderson, an Olivet trustee and chief executive officer of Christian Media Corp.

The 16-count indictment includes felony charges of first-degree scheme to defraud and counts of second-degree money laundering, fourth-degree conspiracy, first-degree falsification of business records and second-degree criminal contempt.

It supersedes a previous indictment announced in October, and includes charges from it — in which Newsweek Media Group (also known as IBT Media), Christian Media Corp. and Oikos Networks were charged in a $10 million fraud probe.

Anderson was also charged in the previous indictment, along with Etienne Uzac, co-owner and chairman of IBT Media.

“After unmasking the scheme to keep Newsweek and Christian Media Corp. afloat, (the district attorney’s) Major Economic Crimes Bureau skillfully followed the money, revealing an even larger scheme to defraud lenders throughout the country, and cycle the ill-gotten gains through a maze of corporate bank accounts,” District Attorney Cyrus Vance Jr. said in a statement. “This investigation remains ongoing, and anyone with relevant information is encouraged to contact us.”

Torossian, the spokesman, said Olivet “stands strongly by the individual members of its team who have been wrongfully accused.”

The school is “dedicated to providing educational and spiritual opportunities to students around the globe — including in locations that are hostile to Christianity and Christian practice,” Totossian added. “Olivet is no stranger to adversity and looks forward to being fully vindicated in court.”

Details of the claims

Vance’s office said Lin, Xiao, Anderson and Uzac worked together to get loans from financial institutions, purportedly to buy computer servers valued from $130,000 to $180,000.

To secure financing, Anderson and Xiao overstated Olivet’s financial health to prospective lenders, giving them false financial statements, prosecutors said. The defendants — and unindicted co-conspirators — created a fictitious auditor to make their false financial statements appear legitimate, Vance’s office said.

Over the course of the scheme, lenders gave Oikos at least $25 million to provide high-capacity computer servers to Olivet, prosecutors said, and the defendants engaged in “sham computer sales transactions” and transferred nearly all of the funds to accounts controlled by Olivet, Xiao, Anderson and the unindicted co-conspirators.

The money was then allegedly transferred through multiple accounts, and used to buy real estate, fund day-to-day operations at Olivet and other unrelated purposes, prosecutors said. All told, “defendants are alleged to have obtained approximately $35 million in funding through their scheme,” Vance’s office said.

Searched in Dover

The prosecutor’s office, with help from state police, conducted a search at Olivet’s Dover campus in March.

At that time, Marian Rebro, president of Dover Greens — the company that focuses on property maintenance and development of the campus — said the search was for “Newsweek servers.”

Nothing was removed from the campus, Rebro said at the time.

Newsweek articles have chronicled financial dealings between its parent company, Newsweek Media Group, and Olivet University at a time when Newsweek Media Group was in financial straits.

Vance’s office raided Newsweek’s offices in January.

Officials in Dutchess County, meanwhile, confirmed in February that the county had accepted free advertising from Newsweek Media Group. But county officials said nothing was offered in return, and there were no promises of favorable treatment in Olivet’s plans to develop a satellite campus in Dover.

https://www.poughkeepsiejournal.com/story/news/crime/2018/11/16/olivet-charged-35-million-money-laundering-scheme/2027705002/

U.S. Expands Coverage of Real Estate Anti-Money Laundering Program

By Samuel Rubenfield

The U.S. Treasury Department said Thursday it has expanded an anti-money-laundering data program that requires title insurance companies to reveal the owners of shell companies buying luxury real estate.

The changes lower the value threshold of potential acquisitions subject to the requirement and expands the coverage to five new cities.

Leaders looking to hide money stolen from their countries, human traffickers and other criminals have bought property in the U.S. using these types of companies to legitimize their ill-gotten gains, analysts say. Law enforcement has seized property ranging from Manhattan apartments to California mansions in their pursuit of laundered money through real estate.

The program, called a geographic targeting order, was launched in January 2016 and is subject to renewal every six months. As of Thursday, the order requires title-insurance companies to file reports to the federal government on “all-cash purchases” through limited liability companies of $300,000 or more of residential property in 12 metropolitan areas. Previously, the value threshold had varied by city and the program covered seven cities, as well as some surrounding counties.

“Reissuing the [geographic targeting orders] will further assist in tracking illicit funds and other criminal or illicit activity, as well as inform [Treasury’s] future regulatory efforts in this sector,” the Treasury said in a statement.

The new order covers purchases made, at least in part, using cash or a cashier’s check, certified check, traveler’s check, personal check, business check, money order, funds transfer or virtual currency. It involves deals made in the metropolitan areas of Boston, Chicago, Dallas-Fort Worth, Honolulu, Las Vegas, Los Angeles, Miami, New York, San Antonio, San Diego, San Francisco and Seattle.

After the program first went into effect, all-cash purchases by companies dropped nationally by about 70%, even in areas not subject to the requirements, according to a paper from economists at the Federal Reserve Bank of New York and the University of Miami.

An effort to nationalize the program was included in a bill in Congress that imposed sanctions on Russia. But lawmakers said this week the clock is running out and the legislation may not pass in time.

FBI raids Wadsworth home in connection with money laundering, selling guns illegally to felons

By Drew Scofield

WADSWORTH, Ohio – The FBI descended on a Wadsworth residence early Wednesday morning that authorities say is connected to an investigation for laundering money and selling guns to felons, according to an FBI spokesperson.

The raid occurred around 4 a.m. in the 2500 block of Blake Road on the city’s West Side, authorities said.

Authorities arrested Francisco Flores, 39, during the raid.

Federal authorities also took 21 “illegals” into custody, according to the Department of Homeland Security.

The U.S. Attorney’s Office said Flores has been indicted on one count of the transfer of firearms for use in drug trafficking, three counts of selling firearms to felons, four counts of money laundering and one count of operating an unlicensed money transmitting business.

Flores is accused of selling various rifles and handguns to individuals who would use them in connection with illegal activities, authorities said.

Between August 2017 and January 2018, authorities say Flores made several financial transactions to “disguise” money he believed were made from drug trafficking. Attorneys said Flores also used his flooring business — Flores Flooring — to “engage in the unlicensed transmitting of money.”

“This is a man who put heavy firepower on the streets for drug dealers, and also helped them launder their drug money,” U.S. Attorney Justin Herdman said. “Ohio is a safer place with him behind bars.”

“Francisco Flores may be known to some in the community as a business owner but to law enforcement, he is known as someone engaged in dangerous unlawful activities,” said FBI Special Agent in Charge Stephen D. Anthony. “These actions will not be tolerated in our community. The FBI’s Northern Ohio Law Enforcement Task Force will continue to disrupt individuals that are a threat to our everyday lives.”

Theft, money laundering allegations sparked raid at Woodfill law office

By Robert Downen and Lise Olsen

Former Harris County Republican Party Chairman Jared Woodfill is being investigated on theft and money laundering allegations, accused of misappropriating funds of at least two of his law firm’s clients, according to an affidavit by the Harris County District Attorney’s office.

Authorities on Monday seized 127 boxes of files, six computers and disk drives from the Houston high-rise office of the Woodfill Law Firm at Three Riverway, according to the returned search warrant filed in Harris County district court on Tuesday.

In his affidavit for the search warrant, which also targeted computer logins, passwords, memory devices, and telephones owned by Woodfill or the law firm, fraud examiner Bryan Vaclavik indicated authorities were seeking evidence used to commit felony offenses of misapplication of fiduciary property, theft and money laundering.

No charges have been filed against anyone in connection with the ongoing investigation. The Harris County District Attorney’s office declined comment on the investigation.

Investigators seized financial records, legal files, documents and correspondence on Monday related to two divorce cases handled by the firm, the search warrant documents show.

The ongoing investigation has nothing to do with Woodfill’s party activities, his attorney Jimmy Ardoin told the Houston Chronicle Tuesday.

Woodfill was chairman of the county Republican Party for 12 years, before losing the post in 2014.

Ardoin said his client had no advance notice of the search and had no details about the allegations beyond the content of the search warrant.

Ardoin said he had been in contact with the district attorney’s office about its review of finances in a divorce case for three to four months and was dismayed that Woodfill was not allowed to provide information voluntarily.

“We believe there’s an accusation of misappropriation of client funds,” Ardoin said. “We have yet to get confirmation of what it is.”

The search warrant indicates the district attorney’s investigation began in February 2017, after Woodfill’s former client, Amy Holsworth Castillo, alleged that Woodfill’s firm misused funds from her divorce case. Castillo filed for divorce from her husband Juan Castillo in 2012 and hired Woodfill in December 2013, court records show.

Juan Castillo later had the divorce case moved to bankruptcy court in Texas’ Southern District in part, he claimed, because of excessive legal fees. Woodfill’s firm filed a motion accusing Juan Castillo of filing his bankruptcy case to skirt payments to his estranged wife, federal court records show.

At one point, Amy Holsworth Castillo’s trust account had less than $650 in it, according to a fact-finding ruling in 2016, in which U.S. Bankruptcy Court Judge Jeff Bohm outlined a year’s worth of transactions and “discrepancies” between bank statements and ledgers for the trust. Based on those records, Bohm concluded that Woodfill’s firm had “taken funds from the (trust) account that have not yet been earned and, thus, several thousands of dollars have been unaccounted for.”

He put the amount of unaccounted funds or overpayments to Woodfill’s firm at more than $140,000.

Woodfill’s firm disputed the findings and planned to appeal Bohm’s finding, court records show.

Both Castillos later filed separate complaints against Woodfill with the State Bar of Texas. In September, the bar publicly reprimanded Woodfill and ordered him to pay $3,490 in attorneys’ fees and direct expenses.

“Woodfill had direct supervisory authority over members of his firm who violated the disciplinary rules during the representation in a divorce,” the State Bar of Texas wrote, “and Woodfill failed to take reasonable action.”

The district attorney’s office also cited a second complaint in the search warrant involving Woodfill’s representation of a woman named Teresa Ribelin Cook, who hired the law firm in June 2013 to represent her in a divorce. The search warrant alleges Woodfill “had used more than $45,000 of Ribelin Cook’s retainer for purposes not related to her case.”

The warrant also cites an interview with a man identified as Woodfill’s controller, Kenneth Kennedy, who is quoted claiming that Woodfill often moved money around between client accounts and his own bank accounts.

Richard Orlando Rodriguez, whose ex-wife also used Woodfill as her divorce attorney, has separately accused Woodfill of taking at least $300,000 from a trust account in a divorce case, according to a March 2017 complaint he filed with the Houston Police Department. That complaint is not mentioned in the search warrant.