Sep 10, 2015
U.S. charges three in multibillion-dollar drug money laundering scheme
By Joseph Ax and Nate Raymond
U.S. authorities have charged three Colombian nationals with helping to run a global money laundering network that processed billions of dollars in drug trafficking profits through bank accounts in China and Hong Kong.
The Guangzhou, China-based organization brought in at least $5 billion in drug proceeds from the United States, Mexico, Colombia, Panama, Guatemala and Canada, as well as parts of Africa and Europe, according to an indictment unsealed on Thursday in federal court in Brooklyn, New York.
One of the three men, Henry Poveda, appeared in court on Thursday; the other two men, Christian Duque-Aristizabal and John Jairo Hincapie-Ramirez, are in custody in Panama and Colombia, respectively, awaiting extradition proceedings.
All three face a single count of conspiracy to launder money.
Assistant U.S. Attorney Amir Toossi told U.S. District Judge Carol Begley Amon that other defendants remain at large. They have not been publicly identified.
According to the indictment, the Guangzhou organization used Chinese casinos, currency exchange houses, export companies and factories to receive billions of dollars in drug proceeds.
The money traveled through accounts in Hong Kong and China and eventually was used to purchase products, often counterfeit consumer goods, that were shipped to Colombia and other countries, prosecutors said.
Poveda's court-appointed lawyer, Mia Eisner-Grynberg, declined to comment on the case. She and Toossi told Amon they have engaged in preliminary plea discussions.
The banks involved were not identified in the indictment.
U.S. authorities have pressed banks in recent years to improve anti-money laundering safeguards. In 2012, HSBC Holdings Plc paid $1.9 billion to resolve claims it allowed drug cartels in Mexico and Colombia to launder proceeds through its banks.
Jodi Avergun, an attorney at Cadwalader, Wickersham & Taft and a former U.S. Drug Enforcement Administration official, said U.S. authorities might be able to go after the Chinese banks if U.S.-based branches were used in the alleged transactions.
"It really depends on what banks were involved, whether the money movement triggered any alarms," she said.
A fourth defendant connected to the case, a Hong Kong woman named Yuling Luo, previously pleaded guilty in April to conspiring to launder money.
Luo faces up to 20 years in prison when she is sentenced. She was arrested in September 2014 at Newark Liberty International Airport in New Jersey during a layover between Panama City and Hong Kong, according to prosecutors.
(Reporting by Joseph Ax and Nate Raymond; Editing by Bernard Orr and Phil Berlowitz)