Cuban man accused of laundering $238 million in Medicare payments must face trial

A Cuban businessman charged with laundering $238 million in illicit Medicare payments through South Florida will have to face trial now that a federal judge has rejected his motion to dismiss a massive money laundering case against him.

The motion by Jorge Emilio Perez de Morales to dismiss the indictment was highly unusual because the 52-year-old is considered a fugitive after fleeing to Spain.

Through his Miami defense attorney, the absent Perez asked a magistrate judge to throw out the case, claiming he was running a legitimate remittance company outside the United States so he couldn’t have committed a crime.

But this month, Magistrate Judge Patrick Hunt denied his motion, saying the U.S. money-laundering conspiracy charge filed five years ago extends beyond the boundaries of this country because the alleged offense happened here.

“If he wishes to contest the charges in this case, [Perez] will have to first submit to the court’s jurisdiction,” Hunt wrote in a nine-page ruling. “If he would like to go to trial, the door to the federal court, as always, remains open.”

Perez’s attorney, Stephen Golembe, has until Friday to appeal the judge’s ruling. It came in response to an unusual hearing in March, when the judge, Golembe and federal prosecutor Ron Davidson debated whether Perez is a fugitive — a thorny legal issue arising from the fact that he has yet to be arrested on the money-laundering conspiracy charge. His lawyer said he isn’t; the prosecutor said he is.



Skimming device found at Cocoa Beach gas station

Cocoa police showed off the devices that were helping thieves steal money at a gas station pump.

A maintenance worker discovered credit card skimmers at the Chevron station at 2700 U.S. Highway 1.

Police are not sure how long the device may have been in place.

Authorities are asking customers who made fuel purchases there to contact their credit card company to verify all recent transactions.

Additionally, they are asking people to be on the alert for any other devices that may be in place in the area.


GOLDMAN SACHS: Bitcoin is looking ‘heavy’

Bitcoin has had a blistering start to 2017. It’s up about 180% so far this year. However, its near-term outlook isn’t looking so hot, according to a note released on Monday by Goldman Sachs head of technical strategy Sheba Jafari.

“The market has come close (enough?) to reaching its extended (2.618) target for a 3rd of V-waves from the inception low at 3,134,” Jafari wrote. “It’s on track to forming a bearish key day reversal if today’s close settles below 2,749.”

Bitcoin hit a lifetime high of nearly $3,000 a coin on Monday, but was unable to hold onto those gains. The cryptocurrency finished the day at $2,599, well below the key technical threshold of $2,749 that was singled out by Jafari.

Now, traders should be paying close attention to $2,475 on a weekly basis, as a close below there would cause even more damage to the technical picture, according to Jafari. “Both daily/weekly oscillators are diverging negatively. All of this to say that the balance of signals are looking broadly heavy.”

Jafari isn’t alone in calling for at least a near-term top in the cryptocurrency. “I think it’s in a bubble,” tech billionaire Mark Cuban tweeted last Tuesday. “I just don’t know when or how much it corrects. When everyone is bragging about how easy they are making $=bubble.” Cuban did not say how far he thought bitcoin would fall.

So where will bitcoin go from here? “Wary of a near-term top ahead of 3,134, Jafari concludes. “Consider re-establishing bullish exposure between 2,330 and no lower than 1,915.”




South L.A. charter school founder charged with embezzlement, money laundering

The head of a now-defunct South L.A. charter school has been charged with embezzlement and money laundering, accused of funneling roughly $200,000 from the school to a company she owned, prosecutors said Thursday.

Kendra Okonkwo, 51, was charged with misappropriation of public funds, grand theft by embezzlement, money laundering and keeping a false account, according to a news release issued by the Los Angeles County district attorney’s office. Her son, 29-year-old Jason Okonkwo, is accused of approving fake invoices to further the plot and faces the same charges, prosecutors said.

Kendra Okonkwo founded the Wisdom Academy for Young Scientists near the Watts neighborhood in 2006, but the school quickly became a target of regulators and lost its charter in 2016. She and her son were arrested in Los Angeles on Thursday morning and remain jailed in lieu of $145,000 bail, according to Deputy Dist. Atty. Dana Aratani, who is prosecuting the case.

From January 2012 to March 2014, approximately $201,000 was transferred from the school to an unnamed business run by Okonkwo, according to the district attorney’s office. The money was then transferred to her personal bank account, prosecutors said.

Her son approved a number of fake invoices, purportedly for the purchase of school supplies and food from his mother’s “shell company,” that documented the transfer of money, prosecutors said.

Okonkwo did not immediately return a call seeking comment, and it was not immediately clear if she or her son have retained attorneys.

Both face up to six years in prison if convicted. A court date has yet to be scheduled.

The school operated under the authority of the Los Angeles Unified School District until 2011, when the district declined to renew the school’s charter, citing violations of education code and conflicts of interest.

Okonkwo agreed to step down as the school’s director as part of an agreement with the county to stay in operation, but she named several relatives and associates to key positions at the school.

That move, according to the findings of a 2014 state audit, allowed her to retain control and benefit from transactions at the academy.

According to the audit’s findings, Okonkwo, her family members and close associates received about $2.6 million in payments from the school. None of the employees in question indicated any financial interest in school affairs on required conflict-of-interest statements, the audit said.

Among the audit’s findings, the organization leased two properties owned by Okonkwo’s holding company, paying more than $1 million in rent over six years. The school also paid Okonkwo $228,665 in severance, unused vacation and a vehicle lease despite a lack of documents to support the amount.

The audit also found the school had paid more than $158,800 to a company owned by a relative of Okonkwo. The payments were supposedly for school supplies, but state auditors could not confirm that the school received any of the materials for which it paid.

Aratani said prosecutors began reviewing Okonkwo’s conduct and business dealings after the audit results were released. An arraignment could take place as early as Friday, he said.

Last year, Okonkwo agreed to pay $16,000 in fines as part of a settlement with the state’s Fair Political Practices Commission after she was found to have established leases for the school at buildings she owned and used public funds to renovate those properties.

“In this matter, Okonkwo engaged in a pattern of violations in which she made, used or attempted to use her official position to influence governmental decisions involving real property in which she had a significant financial interest,” the commission said last year.

When the county began the process of revoking the school’s charter in 2014, Okonkwo claimed she was being “slandered.”

“I’m not a soldier; I’m not a politician. I’m just an educator,” she said at the time.

Photo: My News LA 

Cyprus bank investigated Paul Manafort accounts for possible money laundering

A bank in Cyprus investigated several accounts tied to President Trump’s former campaign chairman Paul Manafort for possible money laundering, according to a new report.

At least one of about 15 accounts associated with Manafort was used to take in millions of dollars from a billionaire supporter of Russian President Vladimir Putin, NBC News reported Tuesday.

Banking sources said transactions from some of those accounts raised enough concern for the bank to open an internal investigation for potential money laundering.

Once the probe opened, Manafort shut the accounts, the sources said.

A Manafort spokesman said in a statement to NBC News that all of the accounts existed only for “a legitimate business purpose” with clients in Cyprus, a Mediterranean island nation often used for Russian money transfers.

“All were legitimate entities and established for lawful ends,” the statement said, adding that Manafort had “no specific personal recollection” of closing the accounts.

Manafort served as the second of Trump’s three presidential campaign advisers, but the longtime lobbyist resigned after four months when reports emerged of his potentially illegal off-the-books deals for $12.7 million from the party for former Ukrainian President Viktor Yanukovych.

Manafort is now at the center of multiple federal probes — including investigations from the CIA, FBI and the Treasury Department — for potential Russian connections, and more of his money mysteries have emerged just this year.

Manafort’s NYC real estate moves raise money-laundering suspicion

Real estate experts said Manafort made several odd real estate transactions in New York City — spanning a period of 11 years — using tactics that resemble money laundering.

Using limited liability companies to buy real estate is not unusual or illegal — but large loans on properties bought with cash can often be a red flag, experts say.

The Associated Press also revealed that Manafort secretly worked for a Russian billionaire advancing Putin’s interests in 2005.

The AP reported last week that Manafort proposed an ambitious political strategy in a June 2005 memo that was based on work he had done in Ukraine. Manafort described how his plan could be used to influence politics in the United States and Europe to the benefit of the Russian government.

Photo: Reuters


21 charged in casino-based money laundering scheme

Federal authorities are moving to dismantle what they describe as a multistate, multimillion-dollar money laundering operation with the indictments of 21 people accused of using counterfeit cards and stolen account numbers for cash withdrawals and retail purchases at casinos and luxury stores.

The case is the latest in an FBI crackdown on money laundering in Las Vegas, but the alleged criminal behavior extended far beyond city borders, according to the 47-count indictment unsealed last month in federal court.

Eleven of the defendants are in custody, being held on money laundering and related charges, and 10 are fugitives.

Authorities say the scheme lasted from 2013 until the arrests, which occurred earlier this year in several states across the country. Prosecutors are seeking upward of $6 million in forfeiture — a response, they say, to fraudulent proceeds obtained through the use of counterfeit cards and “card skimming” technology.
The indictment details a lavish lifestyle enjoyed by those charged in the conspiracy, and legal filings reveal that Las Vegas served as the operation’s home base.

Most of the alleged criminal activity occurred in casinos and popular nightspots throughout the city. The government asserts that the players used swindled funds to run up annual tabs of $95,000 at each of two of Las Vegas’ trendiest social destinations: Hakkasan and XS nightclubs.

When they weren’t paying for bottle service, drinks and other gratuities during late-night escapades, the indictment alleges, the defendants were casino hopping — up and down the Strip, and across the country — to New Orleans; Biloxi, Mississippi; and Detroit. The casino trips might have been a legal gamble, but, according to authorities, they certainly were not a financial risk.

Photo: Think Stock

Big U.S. banks to push for easing of money laundering rules

America’s largest banks are to propose a complete overhaul of how financial institutions investigate and report potential criminal activity, arguing that rules imposed in the years after the Sept. 11, 2001 attacks and strengthened during the Obama administration are onerous and ineffective, sources said. The Clearing House, a trade association representing the largest U.S. banks including Goldman Sachs (GS.N), JPMorgan Chase & Co (JPM.N) and Bank of America (BAC.N), has long raised concerns about the effectiveness of the current rules, but this will be the first time the group has publicly called for them to be revamped.

The proposal, which could be published as soon as Thursday, will set the stage for an intensive lobbying effort targeting bank regulators and members of the Senate and House of Representatives finance committees. President Donald Trump has said he wants to cut costly regulations for Wall Street.

To keep drug traffickers and terrorists from laundering money through the U.S. financial system, federal law mandates that bank employees file a Suspicious Activity Report (SAR) with authorities if they suspect transactions could be part of a crime.

Federal Reserve Gov. Daniel Tarullo, Submitted His Resignation and Will Leave His Post on April 5.


Source: The HILL  2/10/2017

Federal Reserve Gov. Daniel Tarullo, the central bank’s dominant voice on financial regulation, has submitted his resignation and will leave his post on April 5.

Tarullo’s exit will create a third opening on the Fed’s board of governors. He had served on the Fed’s board since January 2009.

“Dan led the Fed’s work to craft a new framework for ensuring the safety and soundness of our financial system following the financial crisis and made invaluable contributions across the entire range of the Fed’s responsibilities,” Chairwoman Janet Yellen said. “My colleagues and I will truly miss his deep expertise, impeccable judgment, wise insight, and strategic counsel.”

Tarullo was a central figure for the Fed in crafting and implementing the Dodd-Frank financial reform law, and his departure makes clear that the Trump administration will soon dictate the direction of regulation at the agency going forward.

In his brief resignation letter, Tarullo said it was a “great privilege to work with former Chairman Bernanke and Chair Yellen during such a challenging period for the nation’s economy and financial system.”

Tarullo’s exit came days after the Fed’s longtime general counsel, Scott Alvarez, also announced he was planning to leave the institution. Both were key figures in helping the Fed navigate its broad new powers to monitor the financial system following the financial crisis.

With Tarullo’s exit, President Trump will have the opportunity to fill three vacancies at the seven-member Federal Reserve Board. He also has the ability to name a vice chair for supervision at the Fed. That position, created by Dodd-Frank, is meant to serve as the point person for all regulatory matters at the central bank. However, such a role was effectively filled by Tarullo, and President Obama never named someone to that post.

Tarullo’s exit does not come as a major surprise, although his term as governor did not expire until the end of 2022.