4-year sentence caps off 18-year-old New Orleans money-laundering case

By: Ramon Antonio Vargas

A dual citizen of the United States and Nicaragua who evaded authorities for nearly two decades received a four-year prison sentence Wednesday after previously pleading guilty in New Orleans to his role in a plot to launder drug money, capping off a case that also involved a disgraced Italian coffee importer and the brother of a famous local mob boss.

U.S. District Judge Sarah Vance additionally ordered Erwin Mierisch, 49, to spend three years under federal supervision.

The case against Mierisch, himself a coffee businessman, dates back to 1999, when a grand jury indicted him in a money-laundering and drug-trafficking scheme. The federal probe led to the conviction of Roberto Gambini, a New Orleans businessman who made a name for himself as the city became the nation’s busiest coffee-importing port.

Charges were also filed against Mierisch’s uncle, Jose Esteban McEwan, who died years ago without ever going to court. A fourth suspect in the case, Joseph Marcello Jr., was the brother of notorious New Orleans mob boss Carlos Marcello, but he died before charges in the case were finalized.

Led by Assistant U.S. Attorney Michael McMahon, the case against Mierisch languished for years as he remained in Nicaragua, which refused to extradite him to the United States. It was revived after Mierisch was captured in Mexico City late last year while in transit between Nicaragua and Tokyo.

He was eventually transferred to New Orleans, where he pleaded guilty, sparing federal prosecutors the challenge of going to trial on an 18-year-old case depending on aged evidence and witnesses who have scattered.

An FBI informant turned authorities onto Mierisch, Gambini and McEwan by introducing an undercover customs agent to Gambini after May 1998, according to a formal admission signed by Mierisch as part of his guilty plea.

The informant told Gambini that the undercover agent had large amounts of drug money needing to be “cleaned up,” and Gambini said he could be of assistance as he had done that kind of thing in the past.

Gambini falsified invoices documenting the wholesale purchase and transfer of coffee, and the list price matched the amount of money that was laundered.

In return for the fake documents, Gambini accepted cash from the undercover customs agent, the “factual basis” filed in court said. Federal officials paid Gambini $45,000 the first time, then returned several more times with similar requests to launder money, according to Mierisch’s factual basis.

Twice, Gambini wired what he thought was drug money to the bank account of a Nicaraguan business using his and Mierisch’s surnames, authorities said.

Meanwhile, Mierisch spoke numerous times with an undercover FBI agent about how he, Gambini and McEwan could supply cocaine. At one point, the agent received 99 grams of cocaine as a sample of the available product, the factual basis said.

Mierisch also acknowledged he paid $20,000 to the agent to arrange an attack on the spouse of an unidentified person who had filed a lawsuit against one of Gambini’s associates.

In the end, Gambini pleaded guilty in 1999 to laundering $900,000 in what he thought was drug money. He was deported to Italy after receiving a prison sentence of 5½ years.

Gambini also admitted he paid undercover agents to incinerate a Miami warehouse full of coffee beans to collect insurance money, and authorities seized an arsenal of more than two dozen guns from his home.

Many were stunned by the fall of Gambini, who arrived in New Orleans in 1990 and would take over more than 200 old grain silos at the Nashville Street wharf, refurbishing them to process and store coffee, according to an account at the time in The Times-Picayune.

Mierisch’s uncle, McEwan, remained on his coffee plantation in Nicaragua and sought to defend himself from the charges remotely.

But McMahon thwarted McEwan’s efforts by arguing that he shouldn’t be able to challenge the indictment in a country where U.S. officials wouldn’t be able to enforce any judgment he might receive against him.

In other cases handled by Acting U.S. Attorney Duane Evans’ office:

• U.S. District Judge Kurt Engelhardt ordered Lionel “Lot” Allen, 23, to spend the rest of his life in prison — and 35 more years after that — for convictions of murder, firearms conspiracy and racketeering following a trial centering around the violent Young Melph Mafia gang, Evans’ office said Wednesday.

The trial resulting in the convictions of Allen and several other defendants was largely shadowed by the 2012 murder of Briana Allen at a birthday party in Central City. Lionel Allen was the target of the gunfire that killed Briana as well as a passing motorist named Shawanna Pierce.

Other defendants had pleaded guilty without going to trial.

Allen’s convictions involved participating in the April 22, 2012, shooting death of Vennie Smith as well as the deadly shooting of Deshawn Hartford later that year. He also found to have been an aider and abettor in the shooting death of Travis Thomas on Interstate 10 on May 6, 2013, Evans’ office said.

• Vance sentenced Angie Cambre of LaPlace to 2 years, 9 months in prison after she previously pleaded guilty to embezzling more than $940,000 from a New Orleans commercial printing company that employed her as a bookkeeper and accountant between November 2011 and June 2016, Evans’ office said Wednesday.

Cambre was also told to pay restitution in the amount stolen as well as spend three years under federal supervision following her release.

• Jarvis Wheeler, 29, of New Orleans, pleaded guilty Wednesday to plotting to alter U.S. Postal money orders, Evans’ office said.

Evans’ office said that Wheeler acknowledged he worked with unidentified co-conspirators to buy U.S. Postal money orders worth $1 or other small amounts and then sent them out of state, where they were amended to higher amounts.

Wheeler said he and the others then deposited the modified money orders to local bank accounts, from which the funds were withdrawn and split up once they cleared.

Wheeler faces up to five years in prison as well as a maximum fine of $250,000.

http://www.theadvocate.com/new_orleans/news/crime_police/article_3785f040-e05c-11e7-a1a6-8b207aa3cfe8.html

Turkish gold trader details money laundering scheme for Iran

Brendan Pierson

NEW YORK (Reuters) – A Turkish-Iranian gold trader described in a U.S. court on Wednesday how he ran a sprawling international money laundering scheme aimed at helping Iran get around U.S. sanctions and spend its oil and gas revenues abroad.

Reza Zarrab, who has pleaded guilty and is cooperating with U.S. prosecutors in the criminal trial of a Turkish bank executive, told jurors in federal court in Manhattan that he helped Iran use funds deposited in Turkey’s state-owned Halkbank to buy gold, which was smuggled to Dubai and sold for cash.

The testimony, given through Turkish interpreters, came on the second day of the trial of Halkbank executive Mehmet Hakan Atilla, who has pleaded not guilty.

U.S. prosecutors have charged nine people in the case, although only Zarrab, 34, and Atilla, 47, have been arrested by U.S. authorities. Prosecutors have said the defendants took part in a scheme that involved gold trades and fake purchases of food to give Iran access to international markets, violating U.S. sanctions.

The case has fueled tensions between the United States and Turkey, which are NATO allies. Turkish President Tayyip Erdogan’s government has said the case was fabricated for political reasons.

Standing before the jury in tan prison garb on Wednesday, Zarrab drew a multicolored diagram to illustrate the complex series of transactions he said he used to avoid scrutiny of U.S. banks and regulators. He explained how he falsified customs documents to make it appear that gold was bound for Iran, rather than Dubai.

Zarrab said Atilla was “the most knowledgeable person about the sanction rules” at Halkbank, and that he helped develop the scheme. He said Atilla and Halkbank’s then-general manager, Suleyman Aslan, instructed him how to carry it out.

“He made sure that the system and method worked,” Zarrab said of Atilla.

Zarrab said he began working with Halkbank on the scheme in 2012, after bribing Zafer Caglayan, then Turkey’s economy minister, to broker a deal with Aslan. He said Aslan had initially refused to work with Zarrab because he was too well known.

Zarrab said he paid Caglayan bribes amounting to more than $50 million.

Caglayan and Suleyman have also both been charged in the case. Turkey’s government has previously said that Caglayan acted within Turkish and international law. Halkbank has said that all of its transactions fully complied with national and international regulations.

Zarrab testified that before working with Halkbank, he handled Iranian transactions through Turkey’s Aktif Bank. He said the bank initially refused to let him open an account, but relented after Zarrab asked Egemen Bagis, then Turkey’s minister of European Union affairs, for help.

 Zarrab said Bagis set up a meeting between him and Aktif Bank’s general manager and that he was then allowed to open an account. However, Aktif Bank later shut down the account after receiving a warning from the United States, Zarrab said.

Reuters was not immediately able to reach anyone at Aktif Bank for comment after working hours on Wednesday.

Zarrab is expected to continue testifying on Thursday.

Government to set up forum to combat money-laundering and financing of terrorism

 An agreement to set up an inter-departmental forum to combat money-laundering and the financing of terrorism has been reached between Finance Minister Malusi Gigaba and Justice Minister Michael Masutha.

It would replace the Counter Money-Laundering Advisory Council (CMLAC) and would aim to improve the quality of consultation for the implementation of the Financial Intelligence Centre Act.

 Gigaba said in a written reply to a parliamentary question by DA finance spokesperson David Maynier that the mandate of the forum or committee “would be to promote discussion, collaboration and co-ordination between the relevant law-enforcement agencies, government departments and regulatory authorities to ensure the South African authorities are more effective in implementing both the spirit and letter of the complete legal framework against money-laundering and terrorist financing.”
He added that “a consultative structure to facilitate engagements with accountable institutions in the private sector is also being established, with a banking sector anti-money laundering and combating the financing of terrorism steering committee already having been established”.

Gigaba said Treasury had published a consultation document to get public comments on these new consultation mechanisms. “We will monitor how well these consultation forums work over the next year or two and, thereafter, make a decision on how best to formalise the consultation forums.”

“We want to deepen and improve our consultative mechanisms to strengthen implementation,” he said. “The CMLAC played a significant role in the drafting of the initial regulations of the Financial Intelligence Centre Act when it was first enacted in 2003, but was not as effective as a forum for implementation.”

 

Saudi Crown Prince Says Islamic Military Counter Terrorism Coalition Will Eradicate Terrorism

Saudi Arabia’s Crown Prince Mohammed bin Salman (shown) said at the November 26 meeting of defense ministers in the Saudi capital of Riyadh that the Saudi-led Islamic Military Counter Terrorism Coalition (IMCTC) would “pursue terrorism until it is eradicated completely,” reported the Saudi-owned television news channel, Al Arabiya.

Al Arabiya reported a statement released by the IMCTC that quoted the crown prince as follows:

I express today our condolences to our brothers in Egypt, as a leadership and people, for what happened in the past days.

We will not allow them [terrorists] to distort our peaceful religion. Today we are sending a strong message that we are working together to fight terrorism. Today we affirm that we will pursue terrorism until it is eradicated completely.

The prince’s expression of condolences pertained to a November 24 terrorist attack inside a crowded mosque in the Sinai Peninsula that killed at least 305 people, making it the deadliest terrorist attack in Egypt’s modern history.

Arab News reported that Saudi Arabia announced the IMCTC alliance in December 2015. It consists of 41 countries and identifies as a “pan-Islamic unified front” against violent extremism.

The IMCTC, observed Arab News, employs an integrated approach to coordinate and unite its members on the four key domain areas of ideology, communications, counter-terrorism financing, and military strategy, “in order to fight all forms of terrorism and extremism and to effectively join other international security and peacekeeping efforts.”

During the meeting, IMCTC Acting Secretary General, Lt. Gen. Abdulelah Al-Saleh, outlined the coalition’s strategy, governance, activities and future plans.

Arab News, reported that the keynote speakers presented their perspectives on counter terrorism efforts in each of the IMCTC’s four key domains:

• “Dr. Mohammad Al-Issa, Secretary General of the Muslim World League, introduced the ideology domain, and the necessity of promoting a message that counters the narrative of violent extremist ideology and reaffirms Islamic principles of tolerance and compassion.”

• “Dr. Mohammad Al-Momani, Minister of State for Media Affairs of Jordan discussed the communications domain, and the importance of producing and disseminating factual, scholarly, and engaging content to undermine and counter the appeal of violent extremism.”

• “Dr. Ahmed Abdulkarim Alkholifey, Chairman and Governor of Saudi Arabian Monetary Authority, discussed Counter Terrorist Financing and the need to promote best practices and advance legal, regulatory, and operational frameworks in prevention, detection, and seizure operations.”

• “Pakistani General Raheel Sharif (Commander-in-Chief of the IMCTC) presented the military domain, which aimed to assist in the coordination of resourcing and planning of member country military CT operations; facilitate the secure sharing of military information; and encourage military CT capacity and capability building to ultimately deter aggression and violence.”

There are currently 41 nations that are members of IMCTC, all of which have Sunni-dominated governments. The alliance does not include any countries with Shia-dominated governments, such as Iran, Iraq, and Syria. Because of this makeup, Hakeem Azameli, a member of the Security and Defense Commission in the Iraqi parliament, called IMCTC “a sectarian coalition.”

A Reuters report noted that Qatar, which is a member of the coalition, was not present at the meeting. Qatar was not invited to the meeting after Saudi Arabia led a group of states seeking to isolate its small Arab neighbor on the Arabian Peninsula, charging that it supported terrorism. Qatar denies this assertion.

The report cited Abdulelah al-Saleh’s explanation that Qatar was excluded to help build a consensus among member countries.

We observed in a report on November 7 that Crown Prince bin Salman has assumed a more important role in Saudi Arabia since his father, King Salman bin Abdul Aziz, issued a royal decree on November 4 that named his son as the head of a newly established anti-corruption committee. The committee headed by the crown prince has the authority to investigate, arrest, issue travel bans, and freeze the assets of those it deems corrupt.

Muhammad bin Salman had been a key figure in Saudi Arabia for months before he was placed at the head of the anti-corruption committee and has been described as the power behind the throne of King Salman.

U.S. foreign bribery cases fast-tracked due to statute of limitations ruling – SEC enforcement chief

NEW YORK (Thomson Reuters Regulatory Intelligence) – A recent decision by the U.S. Supreme Court that places a five-year limit on payments of disgorgement will require the Securities and Exchange Commission to speed up its pending Foreign Corrupt Practices Act cases, a top agency official said on Thursday.

The court’s June ruling(here) affects many parts of federal law enforcement in which prosecutors require firms to pay back ill-gotten gains. But the cases under the FCPA anti-bribery law will be disproportionately affected because they take more time to investigate and often are based on repaying illicit gains, SEC Co-Director of Enforcement Stephen Peiken said.

“We have no choice but to respond by redoubling our efforts to bring cases as quickly as possible,” Peiken told a New York University Law School conference on the FCPA.

He said he supported the spirit of the court’s ruling since “litigation efforts are most effective, when we bring our cases close in time to the alleged wrongful conduct.” The Supreme Court in Kokesh v. SEC decided claims for disgorgement are subject to a general five-year statute of limitations from the date of the violation.

“In many instances, by the time a foreign corruption matter hits our radar, the relevant conduct may already be aged,” Peiken said. “And because of their complexity and the need to collect evidence from abroad, FCPA investigations are often the cases that take the longest to develop.”

The SEC brought a record number of FCPA cases last year, but the number has slowed sharply this year. Lawyers attending the conference said in private comments that the slowdown is part of a normal cycle at the agency as new leadership is installed, and the prior year’s cases were likely sped up by agency enforcement staff planning to exit.

Peiken told the group of compliance and legal professionals, including several international representatives, that the agency remains committed to pursuing FCPA violations. Speculation that enforcement would be eased was raised after President Donald Trump questioned its effect on U.S. business early in his election run. His appointment to head the SEC, Jay Clayton, during his career as a Wall Street lawyer had criticized enforcement of FCPA as overly zealous and suggested the possibility of placing curbs on the statute.

“Will the SEC continue to be committed to robust FCPA enforcement? My answer to that question is simple: Yes,” said Peiken. He cited Clayton as saying during his confirmation hearing that bribery and corruption undermine and distort the marketplace, and ultimately harm investors.

The enforcement head told the group that “the trend of the enforcement division is working closely with foreign law enforcement and regulators in anti-bribery actions to continue its upward trajectory in the coming years.” U.S. investigators and lawyers attending the conference, who asked not to be named, said there are a number of significant cases in the pipeline.

 But the gap with past administrations is widening. The New York Law Journal in September published a study by two lawyers from Fried Frank, Steven M. Witzel and Arthur Kutoro, which said the FCPA slowdown has been marked in the present year, with just three FCPA cases filed, compared with 24 for the first nine months of the Obama administration and 17 for the same period in the George W. Bush administration.

(By Richard Satran of Regulatory Intelligence, New York. Richard Satran is a financial journalist covering daily and emerging issues for Thomson Reuters Regulatory Intelligence)

Anti-Money Laundering Update: FinCEN Makes Small Texas Bank Pay Big Fine

This post at a glance.

  • FinCEN imposes $2 million penalty against community bank
  • Bank failed to conduct appropriate due diligence related to Mexican customer
  • Small banks, other financial institutions need to recognize obligations under Bank Secrecy Act

On October 27, 2017, the U.S. Financial Crimes Enforcement Network (FinCEN) announced a $2 million fine against Lone Star National Bank, an independent community bank in Texas, for “willfully violating” anti-money laundering (AML) requirements of the Bank Secrecy Act (BSA). FinCEN, which is part of the U.S. Treasury Department, has a primary role in safeguarding the U.S. financial system against money laundering and other illicit uses.

FinCEN: Lack of Due Diligence Leads to Bank Secrecy Act Violations

According to FinCEN, Lone Star accepted a Mexican bank as a customer without conducting any significant due diligence on the bank or its owner. FinCEN asserted that, if diligence had been conducted, Lone Star would have discovered the owner’s alleged involvement in securities fraud. FinCEN also determined that Lone Star had opened and operated other high-risk accounts without conducting appropriate due diligence.

This is a problem under the BSA. Under the regulations issued to implement the BSA, U.S. financial institutions must perform due diligence and, in some cases, enhanced due diligence, with regard to correspondent accounts established or maintained for non-U.S. financial institutions and private banking accounts established or maintained for non-U.S. persons.

Bank Secrecy Act Compliance Necessitates Policies to Avoid Money Laundering Activities

According to FinCEN, the Mexican bank moved hundreds of millions of U.S. dollars in suspicious bulk cash shipments through the U.S. financial system in less than two years. FinCEN asserted that the movement of such large amounts of money should have alerted Lone Star of the need for greater scrutiny. Yet according to FinCEN, Lone Star never verified the accuracy of the Mexican bank’s assertions as to the source of funds, account purpose, or anticipated activity.

The BSA implicitly acknowledges that huge amounts of money flow through the U.S. financial system every day. Correspondingly, financial institutions are required to establish appropriate, risk-based policies designed to enable them to detect and report known or suspected money laundering activities. According to FinCEN, Lone Star failed to ask even obvious diligence questions to the Mexican bank and did not follow up on inconsistencies in the answers to the few questions it did ask.

Lone Star has apparently gotten the message. In announcing the penalty, FinCEN acknowledged that Lone Star has now ended its problematic correspondent banking activities. FinCEN also highlighted the fact that Lone Star has engaged outside consultants to conduct independent testing and to focus on customer due diligence and reviews of suspicious activity.

Key Takeaway #1: Size Does NOT Excuse Financial Institutions from Complying with the Bank Secrecy Act

Especially for community and other local banks, the Lone Star matter serves as a valuable reminder that small size is not a defense to financial crimes under the BSA or other U.S. laws. FinCEN specifically stressed that Lone Star’s size did not excuse its failure to comply with the BSA.

The action against Lone Star is also a useful reminder to those financial institutions that are covered by the BSA but are not banks. For example, certain broker dealers and commodities traders are considered to be “covered financial institutions” under the BSA, and thus, have the same diligence obligations as Lone Star.

Key Takeaway #2: Maintain Robust Policies and Procedures to Avoid BSA and other AML Violations

This action provides more evidence that the U.S. government is continuing to aggressively enforce its AML and other financial crimes laws. (See here for another penalty FinCEN announced earlier this year.) There is no indication this enforcement initiative will change any time soon. Banks and other financial institutions need to act accordingly, and ensure their policies and processes are adequate to meet BSA standards and protect against money laundering.

Follow the money: Here’s how money laundering works

, USA TODAY

Special counsel Robert Mueller followed the money to file a criminal conspiracy and money laundering indictment against President Trump’s former campaign manager Paul Manafort and his associate Richard Gates for activities predating their joining the campaign.

Simply put, money laundering is a common technique used by financial criminals and others to hide illegal gains.

“You’re taking ill-gotten gains and ‘washing’ them by transforming them into funds that can’t easily be connected to the original source,” said John Byrne, the former executive vice president of the Association of Anti-Money Laundering Specialists, a crime prevention group.

More than 200 federal crimes can be legal predicates for money laundering Byrne added in a Monday interview.

Placement

After amassing illegal gains, financial criminals typically place the money into the financial system in ways designed to avoid drawing the attention of banks, financial institutions or law enforcement agencies. This is the stage of the washing process most vulnerable to detection, according to a 2014 federal inter-agency manual compiled by the Federal Reserve, Office of the Comptroller of the Currency and other agencies.

Placement techniques include structuring currency deposits in amounts below the $10,000 reporting requirement for banks, or commingling the illicit funds with money from legal activities.

The indictment filed by Mueller’s team alleges that Manafort laundered more than $18 million he received for acting as an agent of a pro-Russia political party in Ukraine and failed to report the work and income as federal laws require. Gates allegedly transferred more than $3 million from offshore accounts to other accounts he owned.

Layering

After the funds enter the financial system, the money is layered, or shifted through a series of transactions designed to create confusion and complicate the paper trail for investigators.

Examples include exchanging monetary instruments for larger or smaller amounts, or wiring or transferring funds through numerous accounts in one or more U.S. or foreign financial institutions.

Some foreign accounts may be so-called “shell companies” — entities that have no physical presence apart from a mailing address and generate no independent economic value, according to advisories from the Financial Crimes Enforcement Network, part of the U.S. Department of the Treasury.

The indictment filed by Mueller’s investment team lists 17 domestic businesses or limited liability companies allegedly owned or controlled by Manafort and Gates. The indictment also identifies 12 entities in Cyprus, and three others in the United Kingdom or the Caribbean islands of the Grenadines.

The indictment also identifies scores of transactions from 2008-2014 in which Manafort allegedly wired more than $12 million from the foreign accounts to vendors for personal expenses without paying taxes on the income.

Integration

This final stage is used to help shield financial criminals by providing a plausible explanation for where the money came from. Examples of integration include purchasing and reselling real estate, investment securities, or other financial assets with money from illicit activity.

The indictment lists four Manafort real estate properties and a life insurance policy that collectively are subject to forfeiture because investigators linked them to his alleged illegal activity and money laundering.

The properties include a luxury home in Water Mill, N.Y., part of the Hamptons area on Long Island’s East End, as well as residences in Brooklyn, Manhattan and Arlington, Va.

Trying to crack down on money laundering through real estate transactions, the Financial Crimes Enforcement Network in February renewed requirements for title agents to identify all people behind shell companies involved in all-cash deals for expensive properties in New York City, the Miami, Fla., San Francisco, and San Diego area, along with San Antonio, Texas.

https://www.usatoday.com/story/money/2017/10/30/follow-money-heres-how-money-laundering-works/813379001/

Paul Manafort, Once of Trump Campaign, Indicted as an Adviser Admits to Lying About Ties to Russia

WASHINGTON — President Trump’s campaign chairman, Paul Manafort, was indicted Monday on charges that he funneled millions of dollars through overseas shell companies and used the money to buy luxury cars, real estate, antiques and expensive suits.

The charges against Mr. Manafort and his longtime associate Rick Gatesrepresent a significant escalation in a special counsel investigation that has cast a shadow over Mr. Trump’s first year in office.

Separately, one of the early foreign policy advisers to Mr. Trump’s presidential campaign, George Papadopoulos, pleaded guilty to lying to the F.B.I. about a contact with a Russian professor with ties to Kremlin officials, prosecutors said on Monday.

The special counsel, Robert S. Mueller III, was assigned in May to investigate whether anyone close to Mr. Trump participated in a Russian government effort to influence last year’s presidential election. Monday’s indictments indicate that Mr. Mueller has taken an expansive view of his mandate.

The indictment of Mr. Manafort and Mr. Gates makes no mention of Mr. Trump or election meddling. Instead, it describes in granular detail Mr. Manafort’s lobbying work in Ukraine and what prosecutors said was a scheme to hide that money from tax collectors and the public. The authorities said Mr. Manafort laundered more than $18 million.

Manafort used his hidden overseas wealth to enjoy a lavish lifestyle in the United States without paying taxes on that income,” the indictment reads.

Mr. Gates is accused of transferring more than $3 million from offshore accounts. The two are also charged with making false statements.

“As part of the scheme, Manafort and Gates repeatedly provided false information to financial bookkeepers, tax accountants and legal counsel, among others,” the indictment read.

Mr. Papadopoulos admitted that in a January interview with the F.B.I., he lied about his contacts with a Russian professor, whom he knew to have “substantial connections to Russian government officials,” according to court documents. Mr. Papadopoulos told the authorities that the conversation occurred before he became an adviser to Mr. Trump’s campaign. In fact, he met the professor days after joining the campaign.

The professor took interest in Mr. Papadopoulos “because of his status with the campaign,” the court documents said.

Mr. Manafort and Mr. Gates surrendered to the F.B.I. early on Monday and were due in court in the afternoon. Money laundering, the most serious of the charges, carries a potential prison sentence of up to 20 years.

Mr. Manafort has expected charges since this summer, when F.B.I. agents raided his home and prosecutors warned him that they planned to indict him. That warning raised speculation that Mr. Manafort might try to cut a deal to avoid prosecution. A senior White House lawyer, Ty Cobb, said last week that the president was confident that Mr. Manafort had no damaging information about him.

People close to Mr. Manafort, including his former business partner Roger J. Stone Jr., have said he had nothing to offer that would help prosecutors build a case against Mr. Trump.

“He’s not going to lie,” Mr. Stone said in September.

Mr. Gates is a longtime protégé and junior partner of Mr. Manafort. His name appears on documents linked to companies that Mr. Manafort’s firm set up in Cyprus to receive payments from politicians and businesspeople in Eastern Europe, records reviewed by The New York Times show.

Attempts to reach Mr. Gates on Monday were not successful. A spokesman for Mr. Manafort did not immediately respond to a request for comment.

Mr. Manafort, a veteran Republican strategist, joined the Trump campaign in March 2016 to help keep delegates from breaking with Mr. Trump in favor of establishment Republican candidates. Mr. Trump soon promoted him to chairman and chief strategist, a job that gave him control over day-to-day operations of the campaign.

But Mr. Trump fired Mr. Manafort just months later, after reports that he received more than $12 million in undisclosed payments from Viktor F. Yanukovych, the former Ukrainian president and a pro-Russia politician. Mr. Manafort spent years as a political consultant for Mr. Yanukovych.

American intelligence agencies have concluded that President Vladimir V. Putin of Russia launched a stealth campaign of hacking and propaganda to try to damage Hillary Clinton and help Mr. Trump win the election. The Justice Department appointed Mr. Mueller III as special counsel in May to lead the investigation into the Russian operations and to determine whether anyone around Mr. Trump was involved.

Mr. Trump has denied any such collusion, and no evidence has surfaced publicly to contradict him. At the same time, Mr. Trump and his advisers this year repeatedly denied any contacts with Russians during the campaign, only to have journalists uncover one undisclosed meeting after another.

The New York Times revealed in July that Mr. Manafort and others close to Mr. Trump met with Russians last year, on the promise of receiving damaging political information about Mrs. Clinton.

Nine in Broward arrested in $94M money-laundering scheme

By Tonya Alanez – Sun Sentinel

Nine Broward County residents have been federally charged along with six others in a $94 million international money-laundering and fraud scheme, federal prosecutors announced Thursday.

The fraudulent operation ran from 2008 to the present and involved romance frauds, email hacking schemes, as well as inheritance and lottery scams, prosecutors said.

Arrested from Broward County were: Jose Daniel Estrella, 38, of Hallandale Beach; Robinson Castillo, 32, and Jamie Vives, 42, Gary Alberto Camillo, 26, Jean-Phillipe Etienne, 25, all of Pembroke Pines; Karina Marie Ocasio, 24, of Weston; Luis Angel de Jesus Alfonseca Pujols, 24, of Sunrise; Randy Eliessel Santos, 29, of Hollywood; and Cosme Daniel Enrique Vasquez, 36, of Miramar.

Arrested from Miami-Dade County were: Alfredo Tovar, 36, of Miami Gardens; Quiana Velasco, 35, of Miami; and Pedro Reyes, 38, of Hialeah.

Rio Olympic head leaves prison; will face corruption charges

By STEPHEN WADE AP Sports Writer

RIO DE JANEIRO (AP) — Carlos Nuzman left prison on Friday after his arrest two weeks ago on eventual charges that he arranged bribes to land the Olympics he headed last year in Rio de Janeiro.

Nuzman walked from a Rio prison wearing a white polo shirt, accompanied by his defense team and watched by a handful of curious bystanders.

The 75-year-old Brazilian is to stand trial for money laundering, tax evasion, and racketeering, though it’s unclear how long that will take under Brazil’s slow-moving justice system.

 Brazilian and French authorities say Nuzman helped direct about $2 million to Papa Massata Diack to win votes to land the 2016 Olympics.

In the 2009 vote by the International Olympic Committee, Lamine Diack — Papa Massata Diack’s father — was a powerful IOC member from Senegal with sway over Africa’s voting bloc.

Rio’s Olympics, although a sporting success, left behind a half-dozen empty sports venues. The subsequent Paralympic Games needed a government bailout to be staged just weeks after the Olympics ended.

Nuzman’s local organizing committee still owes creditors between $30-40 million, and many of the projects built for the games are linked to corruption scandals blanketing Brazil.

Brazil’s Superior Court of Justice ordered Nuzman’s release, but his passports are being held — he is reported to hold three — and he cannot leave the country. He is also barred from contact with the IOC, the Brazilian Olympic Committee, and the local organizing committee.

He resigned last week from the Brazilian Olympic Committee, and his honorary membership has been suspended by the IOC.

Nuzman’s defense argued that the elderly Brazilian is in poor health and should not be held in prison.

The filings against Nuzman say he has undeclared assets in Switzerland, including 16, 1-kilogram gold bars. Prosecutors estimate his net worth increased 457 percent in his last 10 years as the Brazilian Olympic Committee president.

He headed that body for 22 years and also headed Rio’s 2007 Pan American Games.

“While Olympic medalists chased their dreams of gold medals, leaders of the Brazilian Olympic Committee stashed their gold in Switzerland,” prosecutor Fabiana Schenider said when Nuzman was arrested earlier this month.

Schenider added that the “Olympic Games were used as a big trampoline for acts of corruption.”

Leonardo Gryner, Nuzman’s right-hand man at the organizing committee, has also been charged by Brazilian prosecutors. So have both Diacks, former Rio governor Sergio Cabral, and businessman Arthur Cesar de Menezes Soares Filho.

Brazilian authorities say the country spent about $13 billion to organize the Olympics — a mix of public and private money — though one estimate suggested it spent $20 billion.

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