Feds charge 11 for laundering $40M from metro Atlanta to Mexico

Federal investigators have charged 11 people with laundering more than $40 million worth of drug money to Mexico through metro-Atlanta area money transfer services.

The Northern District of Georgia’s US District Attorney’s Office announced Wednesday that the charges came following a three-year investigation focused on money remittance businesses. The nine people in custody are from Gwinnett County, DeKalb County and Atlanta. Two Mexican nationals have been indicted but not yet caught.

The feds began investigating individuals in the metro-Atlanta area in 2014 for suspicion of sending drug money to Mexico, according to a U.S. Department of Justice press release. Federal agent sources infiltrated networks used in small businesses that were funneling money out of the country via money remittance services, the release said. These small businesses allow customers to wire funds to individuals in other countries without using traditional bank accounts.

In exchange for a kickback, managers and employees of nine different businesses allegedly agreed to launder purported drug funds to Mexico by breaking the transactions into smaller amounts and by listing fake sender names, addresses, and telephone numbers. The investigation revealed that the nine money remitters allegedly transmitted more than $40 million over a roughly four-year timeframe.

The release indicates that the suspects tried to conceal the source of the funds by circumventing the Bank Secrecy Act, which requires financial institutions – including money remitters – to monitor their clients for suspicious conduct and to obtain valid identification for high dollar remittances. Multiple suspects were listed as Bank Secrecy Act/Anti-Money Laundering (BSA/AML) compliance officers.

“Using money remitters to launder illegal drug proceeds is just one more way drug cartels fuel their criminal enterprises,” U.S. Attorney John Horn said in the press release. “The business model of many Mexican cartels requires a means to get their cash profits across the border and into the hands of the supervisors and sellers. This investigation shows that they may have found an effective means through unscrupulous money remitters. We hope these cases will help to close this pipeline.”

Nick Annan, a special agent for ICE Homeland Security Investigations Atlanta, said in the release that the criminal network uncovered by this investigation laundered money “provided direct support to the drug trafficking organizations plaguing the region with dangerous illicit narcotics and the violence associated with drug trafficking activities.”


Photo: Thinkstock



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.



U.S. Accuses Chinese Company of Money Laundering for North Korea

TOKYO — United States prosecutors accused a Chinese company on Thursday of laundering money for North Korea and said they would seek $1.9 million in civil penalties, as American efforts to put pressure on the isolated country continue to affect Pyongyang’s neighbor and biggest benefactor.

Prosecutors said the company, Mingzheng International Trading Limited, operated as a front company for North Korea’s state-run Foreign Trade Bank, which since 2013 has been the target of American sanctions intended to choke off funds connected to the country’s nuclear weapons program. The penalty, if approved by the United States District Court for the District of Columbia, would be “one of the largest seizures of North Korean funds by the department,” according to a statement from prosecutors.

In their statement, prosecutors said Mingzheng was created to “surreptitiously move North Korean money through the United States.” In a filing with the court, prosecutors said the funds were being held in a bank account in the United States.

Calls to a Mingzheng phone number in Hong Kong, a semiautonomous Chinese city where the company is registered, were not answered.

The United States has increasingly targeted North Korea’s money sources with the outside world to help tame its ambitions to develop nuclear weapons. That effort has led American officials to focus on companies in China, which acts as North Korea’s protector and is its most important trading partner.

Last year, the United States Treasury said it would cut off from the American financial system any bank or company conducting banking transactions with North Korea. Experts said the move could hit smaller regional banks in China, especially those along its border with North Korea.

China has opposed the effort, saying the United States is imposing its own domestic laws on other countries.

Citing confidential informants, prosecutors said Mingzheng was operated by a Chinese citizen with ties to the Foreign Trade Bank. It did not name the citizen.

Mingzheng’s corporate filings in Hong Kong listed its sole shareholder as Sun Wei, a resident of Benxi, an area near the Chinese city of Shenyang in Liaoning Province. Mr. Sun could not be reached for comment.

Prosecutors told the court that Mingzheng’s financial transactions were closely linked to another Chinese company called Dandong Hongxiang. Last year, the Justice Department filed criminal charges against its top executive and several of her colleagues, accusing them of violating American sanctions through a similar, covert money-transfer scheme.

Citing a confidential informant, prosecutors also said Mingzheng played a role in payments between a North Korean telecommunications company and ZTE, a Chinese maker of telecommunications equipment. In March, ZTE agreed to plead guilty and pay $1.19 billion in fines as part of a settlement for breaking United States sanctions and selling electronics to North Korea and Iran.

The United States Justice Department said the $1.9 million was the amount that Mingzheng transferred on North Korea’s behalf in October and November 2015.

Those payments, made in dollars, were cleared through the United States, the prosecutors said, who are seeking permission from the court to seize the funds.


Photo: Associated Press

Anti-gang cops arrest nine following year-long probe into illegal gambling

Nine people have been arrested by B.C.’s anti-gang task force after a year-long investigation involving illegal gambling houses and millions of dollars in laundered money in Metro Vancouver.

In May 2016, an integrated unit within the Combined Forces Special Enforcement Unit started a probe into a criminal organization allegedly operating illegal gambling houses, loan sharking, carrying out money laundering for drug traffickers, kidnappings, extortions and other violent acts.

“During the investigation, it was apparent there were multiple roles filled by different people (who) enabled or facilitated the organization in laundering large amounts of money through casinos,” said CFSEU Assistant Commissioner Kevin Hackett at a news conference Tuesday at RCMP “E” Division headquarters in Surrey.

Hackett pegged the amount of money laundered into the “millions.” He declined to name any of the casinos, but said they are all in the Lower Mainland.

The investigation by the joint illegal gambling investigation team also uncovered that the Lower Mainland-based organized crime group had operations that extended to China and other countries, he said.

A search of six homes led to the seizure of cash, drug paraphernalia, cellphones, computers, and a number of luxury vehicles, including one that had a sophisticated hidden compartment. Some of the items seized — stacks of bills in clear plastic bags, scales and bill-counters — were on display at the news conference.

The suspects have not been charged but face possible charges of money laundering, drug trafficking and proceeds of crime. They are not in custody. None of them were employed by the casinos.

Peter Goudron, executive director of the B.C. Gaming Industry Association, said it is concerned by the CFSEU’s assertion that large amounts of money were laundered through casinos.

“Given the robust (anti-money laundering) procedures in place at B.C. casinos we are unaware how this could have taken place and expect to learn more about their allegations in the near future,” he said in a statement.

The association said B.C. casinos are required to report any cash buy-in over $10,000 and all suspicious transactions to the B.C. Lottery Corporation and Fintrac, Canada’s money-laundering watchdog.

The task force also executed a raid Monday night at an illegal gambling house in Richmond believed to be associated with the group, said Hackett. About three or four such venues were uncovered during the investigation. Some of them were located in homes.


Photo: Jason Payne PNG 

Money laundering gang smashed and three quarters of a million pounds seized by National Crime Agency

A money laundering gang has been smashed after the UK’s answer to the FBI seized more than three quarters of a million pounds.

Four crooks, including a husband and wife from Sale, Trafford, were snared when the National Crime Agency (NCA) put them under surveillance at a North London hotel.

NCA investigators recovered £760,000 during the undercover sting.

They watched as French national Yongheng Jin met with Albanian Marsel Meco in the car park of the hotel.

From the boot of a vehicle they removed a large black suitcase.

Officers stopped Jin as he entered the hotel with the luggage and found that it contained approximately £420,000.

In Jin’s hotel room, officers recovered numerous items associated with money laundering, including a cash counting machine, bundles of money, a UV counterfeit money detector, scales, rubber bands, cash bags, numerous pieces of paper recording large numbers, bank cards, and several mobile phones.

During the search another man, Luis Martos Gardner, a Spanish national, knocked at the door.

Suspecting he may be involved, officers arrested him and when they searched his car they recovered more than £340,000 split into several bags. They also discovered several mobile phones and a pocket diary which contained multiple bank notes of differing currency.

After gathering further evidence, officers arrested Xiaoqun Tu, a German national and wife of Yongheng Jin, at their home in Sale, Trafford, in March 2017. They recovered mobile phones, a laptop and more cash.

All four pleaded guilty to money laundering offences at Kingston Crown Court and were sentenced to a total of 11 years and 10 months imprisonment.


Govt seeks anti-money laundering compliance info from brokers

Stock brokers have been directed to furnish details about their compliance with various anti- money laundering requirements as the government steps up efforts to deal with the black money menace.

Amid the crack down on shell companies, the Finance Ministry has sought detailed information with respect to stock brokers in order to understand their compliance levels in terms of norms pertaining to curb money laundering and terror financing activities.

Following a directive from the Department of Economic Affairs, markets regulator Sebi has now asked stock brokers to submit the relevant details as early as this month itself.

Information has been sought with respect to “Anti-Money Laundering and Combating Financing of Terrorism (AML and CFT) areas to assess the technical compliance with the global FATF recommendations and effectiveness of AML/CFT systems”.

Details have to be furnished by the stock brokers for the last three financial years.

Complying with Sebi directions, leading exchange BSE has asked stock brokers registered with it to provide the information.

The details are required to be submitted for 2014-15, 2015-16 and 2016-17, according to a circular issued by BSE.

Stock brokers have to keep these details ready in a prescribed format separately for each financial year.

The brokers are required to be given information on total number of employees with the organisation, number of employees who acquired certification in AML/ CFT areas, per- centage of employees who were imparted ‘in-house’ training in AML/CFT areas and percentage of employees found to be familiar with AML/CFT guidelines from surveys conducted, for each of the last three financial years.

Total number of employees include those in clerical and supervisory cadres up to the level of senior management but should exclude those in subordinate cadre as well as officials in top executive grades.

“In-house training indicates learning sessions of a minimum one-hour duration on AML/CFT areas, conducted by the organisation for the benefit of their employees as part of their internal training programmes/ workshops,” BSE said.

“Employees found to be familiar with AML/CFT guidelines can be ascertained from conducting surveys across different verticals and geographies. The survey reports must include the size of the group studied. Copies of such survey reports should be attached with this return,” it added.

Financial Action Task Force (FATF), an inter-governmental body, sets global standards for anti-money laundering and countering financing of terrorism regulations for governments worldwide. India has been its member since 2010.



DeLand man arrested in drug distribution, money laundering operation tied to Mexican…

Federal agents said a DeLand man arrested Friday distributed drugs in Volusia County and then transported the money to a Mexican drug group in Arizona.

Wilfredo Arroyo and an accomplice, Patricia Catron, conducted the drug operation in Volusia and the Central Florida area between Nov. 1, 2015 and Oct. 21, 2016.

Arroyo was charged with conspiracy to traffic marijuana 25 pounds or more, conspiracy to commit money laundering $100,000 or more and the unlawful use of a two-way communication device to facilitate the commission of a felony. Arroyo was being held Sunday at the Volusia County Branch jail without bail.

It was not immediately clear Sunday if Catron had been arrested.

According to reports, the Federal Bureau of Investigations Safe Street Task Force, which includes a Volusia County Sheriff’s Office investigator, asked Volusia and federal judges to grant authorizations to intercept the suspects’ telephone calls from members of the Mexican Transnational Criminal Organization.

Court documents did not name the specific gang affiliation, but U.S. Drug Enforcement documents list the notorious Sinaloa Cartel as the dominant transnational organization in Central Florida.

Task force investigators listened to telephone calls from Arroyo and Catron between September and October 2016 as they chatted with Josue Hernandez, who guided them to Arizona, transporting money believed to be the proceeds from drug sales, investigative reports said.

Hernandez was arrested Oct. 21, 2016 in Lake County and admitted that he and Arroyo were involved in a long-term marijuana trafficking organization that shipped hundreds of pounds of marijuana from Mexico to Central Florida, federal agents said.

According to reports, Hernandez also said he and his accomplices arranged the return of more than $100,000 in cash — the proceeds from marijuana sales to the drug trafficking organization.

Agents surveilling Arroyo and Catron executed a search warrant at Arroyo’s Forest Ridge Road home in DeLand and found 42 pounds of marijuana and pieces of metal containers similar to those used by Hernandez to transport marijuana, agents said.

Agents also found a buried freezer at the home used to store drugs, federal investigators said.


Cuba warns of human trafficking risk due to frosty U.S. ties

Cuba and the United States have dramatically reduced the rate of human trafficking since reaching a landmark accord in January but risk losing those gains if the two neighbors fail to resume high-level talks, Cuban Interior Ministry officials said in an exclusive interview.

During bilateral talks in the final days of former U.S. President Barack Obama’s administration, the United States agreed on Jan. 12 to end a longstanding policy of admitting Cubans who set foot on U.S. soil, a move aimed at discouraging them from taking a dangerous voyage on the high seas.

 The “wet foot, dry foot” policy was one example of the special welcome the U.S. government extended to Cubans as it sought to isolate the island’s Communist government, and its repeal marked the culmination of Obama’s rapprochement with America’s former Cold War rival.

Since President Donald Trump assumed power on Jan. 20 with promises to review the detente, high-level bilateral talks have ground to a halt. In the meantime, smuggling rings have been trying to reorganize and consolidate, Cuban officials said, seeking new ways to sneak Cubans and other foreign nationals into the United States.

Although U.S. and Cuban law enforcement agencies maintain direct communications with each other, the high-level talks are essential, the Cubans say.

“It’s of great importance for both countries because the security of both is put at risk,” Lieutenant Colonel Dalgys Lamorut said. “Cooperation is important to safeguard the advances we have made.”

Lamorut, representing the immigration directorate, and two other lieutenant colonels in the Interior Ministry, representing the police and coast guard, spoke to Reuters on Wednesday in a rare opening to the foreign media, limiting their comments to human trafficking and immigration fraud.

The interview took place as the Trump administration nears completion of a policy review to determine how far it will go in rolling back Obama’s engagement with Cuba, according to current and former U.S. officials and people familiar with the discussions. The announcement of any policy change could come in June, they said. Trump, a Republican, has been critical of the move by his Democratic predecessor on the grounds it did not push Cuba hard enough on human rights issues.

At a meeting of senior officials from major U.S. government agencies in mid-May, Justice Department and immigration service officials were among those who expressed support for continuing law enforcement engagement implemented under Obama’s rapprochement, according to people familiar with the discussions. However, Trump’s senior national security aides have yet to take up the issue in detail, the sources said.

Bilateral talks enable multiple agencies from both sides to coordinate and update strategies against criminal organizations, said Lieutenant Colonel Marco Rodriguez, representing Cuban police.

“These organizations are not going to cease their criminal activity, which undoubtedly is going to involve Cuba and the United States,” Rodriguez said.

“Together we can continue neutralizing these structures,” he said.


Photo: Reuters 

Senators Call for Digital Currency Oversight in Anti-Money Laundering Bill

A pair of US senators have filed a new anti-money laundering bill aimed at beefing up oversight of digital currency activities.

The bill – the Combating Money Laundering, Terrorist Financing and Counterfeiting Act of 2017 – was filed last week by Senator Chuck Grassley of Iowa and Senator Diane Feinstein of California.

Among the changes, according to a draft text of the bill, are additions to definitions for “financial institutions”, which, if the bill is passed, would include “any digital currency exchanger or tumbler”. Additionally, the bill clarifies that any “issuer, redeemer or cashier” of a “digital currency” is also covered.

While not explicitly spelled out as such, the bill moves bitcoin and other digital currencies closer to being defined as a “monetary instrument” under US anti-money laundering statutes, as it targets “funds stored in a digital format”, according to a summary published by Grassley’s office.

Beyond the regulatory adjustment, the bill seeks information from the US Department of Homeland Security’s Customs and Border Protection (CBP) agency about its policies on digital currencies.

Specifically, it calls for a report “detailing a strategy to detect prepaid access devices and digital currency at border crossings and ports of entry”. This report – which would be due 18 months after the ostensible passage of the bill – is also required to include details about how such a strategy would be implemented.

The bill’s release comes shortly after a member of the US House of Representatives called for a study into virtual currency use for terrorism financing.


Photo: CoinDesk