The Americas Post » Money Laundering

Mexican cartel leader gets off easy in US court

tlc — Fri, 06 Jan 2012 02:18:30 +0000

The Americas Post - The Tijuana cartel leader got off with a lighter sentence than his underlings

Former drug capo Benjamin Arellano Felix pleaded guilty this week to federal racketeering and money-laundering conspiracy charges, putting an end to a long case against Mexico’s formerly most powerful organized crime group.

Arellano Felix, 58, the former leader of the Arellano Felix drug cartel, converted Tijuana into a major trafficking route to the U.S. during a 16-year run before his arrest in Mexico in 2002.

His group, also known as the Tijuana cartel, funneled tons of drugs into California, terrorized rivals, bribed Mexican law enforcement officials and financed luxurious lifestyles that became symbolic of Mexican organized crime.

According to the plea deal with federal prosecutors in San Diego, Arellano Felix admitted making hundreds of millions in profits, exchanging weapons for drugs from a rebel group in Colombia and training teams to assassinate competitors and witnesses.

Extradited from Mexico in April, he now faces a maximum penalty of 25 years in prison, according to the agreement. Under terms of the extradition agreement with Mexico Arellano Felix was not subject to the death penalty, but many expected him to receive a life sentence.

His organization introduced paramilitary tactics, including .50-caliber machine guns and armored cars with oil and smoke dispensers to evade arrest.
The cartel regularly used chemicals to dispose of enemies, dissolving bodies in vats of acid.

As part of the plea agreement, four of the five original charges were dismissed. Arellano Felix pleaded guilty to only two counts: racketeering and conspiracy to launder monetary instruments. He also agreed to forfeit $100 million, according to the agreement.

The U.S. attorney for San Diego, Laura Duffy, called the case historic.

“Arellano-Felix led the most violent criminal organization in this part of the world for two decades. Today’s guilty plea marks the end of his reign of murder, mayhem and corruption, and his historic admission of guilt sends a clear message to the Mexican cartel leaders operating today: The United States will spare no effort to investigate, extradite, and prosecute you for your criminal activities.”

US loaned surveillance plane for Jamaica raid

tlc — Tue, 13 Dec 2011 04:06:49 +0000

The Americas Post - Plane? What plane? Oh, you mean THAT plane...

An American military aircraft helped monitor the deadly 2010 raid by Jamaican security forces to capture a fugitive crime boss, that country’s prime minister has admitted, in spite of earlier denials by his government.

The U.S. P-3 Orion provided aerial surveillance of the operation to arrest Christopher “Dudus” Coke, Prime Minister Andrew Holness told reporters on Thursday. The raid ignited a vicious battle in a West Kingston slum that left over 70 dead.

Holness insisted that the U.S. played no other role in the raid in the Tivoli Gardens neighborhood. ”We would want to reaffirm our position that the U.S. Government or its military did not participate in the operations in West Kingston,” he said.

His statement came just one day after National Security Minister Dwight Nelson claimed that the U.S. had not provided any surveillance of the raid, in spite of a report in The New Yorker magazine.

Holness said that Nelson made the statement in error because he was unaware of the U.S. assistance. Prior official statements had also denied any U.S. role in the raid. The prime minister said the surveillance was coordinated between the Jamaican Defense Force and the “relevant government agency” in the U.S.

“The United States Government initially made an offer to provide surveillance and technical equipment,” he said. “We accepted and followed the normal protocol of exchanging diplomatic notes to provide the government-to-government cover for such assistance.”

Ocsar Derby, director of Jamaica’s Civil Aviation Authority, said Friday that officials with the island’s Defense Force had notified him the U.S. craft would carry out a surveillance mission.

“We made sure to keep other aircraft away from the area,” he said.

The hunt for Coke in his West Kingston slum stronghold provoked fighting that killed 73 civilians and three security officers over the next four days. He was finally arrested by Jamaican authorities and extradited to the U.S., where he pleaded guilty in August to racketeering and assault charges. Coke faces up to 23 years in prison when he is sentenced.

Brazilian mafia links to Uruguayan casinos probed

tlc — Tue, 13 Dec 2011 02:39:07 +0000

The Americas Post - Illegal lottery results are openly posted in Rio de Janeiro.

Brazilian police are investigating possible connections between the organized crime groups controlling illegal gambling in Rio de Janeiro and Russian and Israeli mafias, with casinos in Argentina, Ecuador and Uruguay.

According to daily newspaper O Globo, the legal casinos play a key role in laundering money for operators of illegal lotteries and slot machines in Rio. Other crimes under investigation by Brazilian Federal Police include tax evasion, smuggling and homicide.

According to the police, the Israeli Abergil and Russian Bratva organized crime syndicates were sought out by the Brazilian operators of the illicit Bicho lottery, for their expertise in money laundering. Evidence of the connection came to light during investigations of cash remittances to foreign bank accounts, mainly in Uruguay and Panama, associated with various hotels operating casinos in South America.

Investigations over the last two years have produced 21,000 hours of recorded telephone calls between known criminals such as Israeli Yoram El Al, Meir Zloff, Tal Amir, Genrich Birman and Vitaly Okorov.

Illinois governor gets 14 years for corruption

tlc — Thu, 08 Dec 2011 01:30:53 +0000

The Americas Post - Blagojevich keeps up with Illinois governor tradition by going to jail.

Former Illinois governor Rod Blagojevich, who was convicted of attempting to barter President Barack Obama’s U.S. Senate seat for campaign cash or personal favors, has been sentenced to 14 years in prison.

Blagojevich led the fifth-most populous American state from January 2003 to January 2009, one month after his arrest for what Chicago U.S. Attorney Patrick J. Fitzgerald called “a political corruption crime spree.”

Blagojevich, 54, was found guilty of 17 charges in June. Prosecutors asked U.S. District Judge James Zagel for a sentence of 15 to 20 years in prison, arguing it would set an example in a state where four of the nine most recent governors have been convicted for crimes committed before, during or after they held office.

The twice-elected Democrat received the longest sentence among the four Illinois governors sent to prison in the last four decades. He is the second in a row to go to jail; his Republican predecessor, George Ryan, is now serving 6 1/2 years. The other two did three years or less.

Blagojevich made a last plea for mercy, telling the judge he’d made “terrible mistakes” and admitted for the first time that he broke the law.

“I caused it all, I’m not blaming anybody,” Blagojevich said. “I was the governor and I should have known better and I am just so incredibly sorry.”

It didn’t help.

“Whatever good things you did for people as governor, and you did some, I am more concerned with the occasions when you wanted to use your powers … to do things that were only good for yourself,” Zagel said.

“The governor was not marched along this criminal path by his staff,” the judge concluded. “He marched them.”

U.S.- Paraguay: Ciudad del Este is a center for international illegal activities.

Carbonero — Mon, 28 Nov 2011 01:51:23 +0000

Paraguay and the United States have good relations, cooperating extensively on counternarcotics and counterterrorism efforts. The United States strongly supports the consolidation of Paraguay’s democracy and continued economic reforms. Following the April 2008 election, then-U.S. Ambassador to Paraguay James Cason congratulated Lugo and the APC on their victory and expressed a commitment to work with them to strengthen bilateral relations. U.S. imports from Paraguay totaled $78.4 million in 2008 while the value of U.S. exports to Paraguay was over $1.6 billion.44 Machinery and electrical machinery account for the lion’s share of U.S. exports to Paraguay.

The protection of intellectual property rights (IPR, e.g., fighting piracy, counterfeiting, and contraband) has been a U.S. concern. The Duarte government made significant efforts to improve IPR protection, but the United States Trade Representative maintains that the country continues to have problems due to its porous border and ineffective prosecutions. In 2003, U.S. and Paraguayan officials signed a Memorandum of Understanding (MOU) to strengthen legal protection and enforcement of intellectual property rights in Paraguay. In December 2007, the MOU was revised and extended through 2009, and in November 2009 the agreement was extended again through 2011.45

U.S. Assistance

The United States provided about $13.1 million in foreign assistance to Paraguay in FY2008 and an estimated $26.1 million in FY2009.46 The increase in FY2009 was due to a one-time addition of $10 million for health and economic growth assistance resulting from the October 2008 meeting between President Lugo and former President Bush.

Under the Obama Administration’s FY2010 request, Paraguay would receive $13.9 million in assistance, with $2.1 million to support Global Health and Child Survival, $5.8 million in Development Assistance, $425,000 in International Military Education and Training, $750,000 for Foreign Military Financing, $500,000 in International Narcotics Control and Law Enforcement assistance, and $4.3 million for the continuation of a Peace Corps program in the country, with approximately 200 volunteers.

In 2009, the Department of Defense also provided Paraguay one-time security and stabilization assistance authorized under Section 1207 of the National Defense Authorization Act (NDAA). In FY2009, Paraguay received a total of $6.69 million in “Section 1207” funding divided between counternarcotics and development accounts to support democratic consolidation and reduce violence in eastern Paraguay during the country’s transition from one-party rule to multi-party democracy.47

In addition to regular foreign assistance funding, Paraguay signed a $34.65 million Threshold Program agreement with the Millennium Challenge Corporation (MCC) in May 2006. Those funds, which are administered by the U.S. Agency for International Development (USAID), are targeted to strengthen the rule of law and build a transparent business environment.48 The program has been credited with reducing the time it takes to start a business in Paraguay by half, among other accomplishments. In May 2009, the USAID-administered program was renewed with the signing of a second two-year MCC Threshold program for $30.3 million.49 The program supports anti-corruption efforts by Paraguay’s government in law enforcement, customs, health care, and judicial sectors. The MCC program also aims to increase public support for anti-corruption efforts.50 Paraguay also signed an agreement with the United States in 2006 under the Tropical Forest Conservation Act that provided Paraguay with $7.4 million in debt relief in exchange for the Paraguayan government’s commitment to conserve and restore tropical forests in the southeastern region.

Counternarcotics Cooperation

Paraguay is a major transit country for illegal drugs destined primarily for neighboring South American states and Europe. It produces over half of the marijuana grown in South America. The Chaco region in the northwestern part of the country adjacent to Bolivia is a major transshipment point for illegal drugs, along with the tri-border area (TBA) with neighboring Argentina and Brazil. A 1987 U.S.-Paraguay bilateral counternarcotics agreement was extended in 2006.

U.S. counternarcotics efforts in Paraguay have focused on providing training, equipment and technical assistance to strengthen the country’s National Anti-Drug Secretariat (SENAD), and to combat money laundering and corruption. The United States assisted in the completion of a helicopter pad and support facilities for SENAD. According to the State Department’s February 2009 International Narcotics Control Strategy Report, SENAD continued to make progress against illegal narcotics trafficking in 2008 with record seizures of marijuana, although cocaine seizures were markedly down. The report notes that President Lugo has said he wants to reverse Paraguay’s status as a “major drug transit country.” Currently, SENAD agents are civil servants and they are not issued weapons. The Paraguayan Senate rejected a bill that would have made the SENAD an autonomous institution with the power to regulate its agents as law enforcement agents who can carry and use weapons. The bill had passed the Chamber of Deputies. This defeat is considered by some to be a major setback. Finally, INCSR notes that SENAD’s work is limited by budget constraints, weak laws and pervasive corruption. After President Evo Morales of Bolivia kicked out the U.S. Drug Enforcement Administration (DEA) in late 2008, 10 of the 56 agents working in that country were redeployed to Paraguay in early 2009.51

In April 2009, bills entitled the “U.S.-Paraguay Partnership Act of 2009” were introduced in the House (H.R. 1837) and Senate (S. 780). On September 14, 2009, the ATPDEA Expansion and Extension Act of 2009 (S. 1665) was introduced in the Senate.52 Each of these bills would amend the Andean Trade Promotion and Drug Eradication Act (Title XXXI of the Trade Act of 2002, P.L. 107-210) to extend trade preferences to Paraguay. Currently, Colombia, Ecuador, and Peru benefit from the ATPDEA in exchange for cooperation under anti-narcotics agreements.53 Bolivia lost its eligibility for the program in 2008 when the Bush Administration determined that Bolivia no longer met the anti-narcotics cooperation requirements.

Tri-Border Area and Terrorism

The United States is particularly concerned about illicit activities in the tri-border area (TBA) of Paraguay, Argentina, and Brazil, where money laundering, drug trafficking, arms smuggling, and trade in counterfeit and contraband goods are prevalent. The tri-border region is loosely controlled due to porous borders, a lack of surveillance, weak law enforcement and pervasive local corruption, especially in the Paraguayan border city of Ciudad del Este. The United States has worked closely with the governments of the TBA countries on counterterrorism issues through the “3+1” regional cooperation mechanism, which serves as a forum for discussions, and the United States has provided anti-terrorism and anti-money-laundering support to Paraguay.

U.S. Immigration and Customs Enforcement (ICE) sent a team of specialists to the tri-border region to investigate trade-based money laundering in 2006, and has assisted the Paraguayan government in developing a Trade Transparency Unit to examine discrepancies in trade data in order to detect customs fraud, trade-based money laundering or the financing of terrorism.54

U.S. Treasury officials have held workshops in the region to encourage more banking sector involvement in efforts against money laundering. The U.S. embassy’s legal adviser in Asunción held training courses for local investigators and prosecutors to combat possible terrorism links.55

The United States has been concerned for a number of years that the radical Lebanon-based Hezbollah and the Sunni Muslim Palestinian group Hamas have used the TBA to raise funds from the region’s sizable Muslim communities by participating in illicit activities and soliciting donations. Nevertheless, according to the State Department’s annual terrorism report for 2008 (issued in April 2009), there is no corroborated information that these or other Islamic extremist groups have an operational presence in the TBA.

The State Department’s 2008 terrorism report stated although Paraguay was generally cooperative on counterterrorism efforts, its judicial system is weak and politicized, the police force is widely viewed as ineffective and corrupt, and the country lacks strong anti-money laundering and terrorist financing legislation. In June 2008, Paraguay’s Congress improved money laundering legislation as part of a major overhaul of the penal code. However, according to the terrorism report, a bill to enact important criminal procedure reform to prosecute money laundering and terrorism was delayed for a year by the Congress’s Legal Reform Commission. Effective terrorist financing legislation will be critical to keep Paraguay current with its international obligations.

The terrorism report also maintained that Paraguay did not exercise effective immigration or customs control on its borders. Efforts to address illicit activity in the TBA were uneven because of a lack of resources, and corruption within customs, police, and the judiciary. With U.S. support, the government’s Secretariat for the Prevention of Money Laundering reportedly made progress against money laundering, including December 2008 raids on illegal exchange houses.

Under the MCC Threshold Program, the United States provided assistance with the training of judges, prosecutors and police in investigation techniques critical to money laundering and terrorist cases.

Paraguay made some progress on counterterrorism legislation in 2009. The Paraguayan Congress passed a measure in July 2009 that modifies the anti-money laundering law. The passed bill empowers the Secretariat for the Prevention of Money Laundering (SEPRELAD) in several ways. It elevates the agency to the level of a ministry that reports directly to the President, it broadens its capacity to require Suspicious Transaction Reports from a wider group of financial institutions, and it increases SEPRELAD’s power to audit financial institutions to ensure their procedures are adequate to prevent money laundering. In addition, the Executive has initiated legislation that would criminalize the offences of terrorism, terrorist association and terrorist financing. Attempts to gain the approval of Congress on such legislation were made in 2007, November 2009, and December 2009. In December 2009, President Lugo withdrew the counterterrorism legislation that would modify some aspects of the criminal code over objections raised by human rights organizations who argued that the new legislation threatened the international protection of human rights and may undermine freedom of assembly and freedom of speech. Paraguayan authorities, however, remain optimistic that a modified initiative may pass later in 2010.56

June S. Beittel is analyst in Latin American Affairs (UNACE) for CRS. Parts of this report were contributed by Mark P. Sullivan, Specialist in Latin American Affairs. This report was published by the Congressional Research Service under the title “Paraguay: Political and Economic Conditions and U.S. Relations,”

Extradition approved for Guatemalan ex-president

tlc — Thu, 17 Nov 2011 04:45:39 +0000

The Americas Post - Another former president heads off to jail. Photo Credit: Prensa Libre

Guatemalan President Alvaro Colom announced Tuesday approval of a U.S. extradition order for former president Alfonso Portillo, who faces money laundering charges for the alleged embezzlement of $1.5 million in foreign donations.

Colom said Guatemalan courts have already approved Portillo’s extradition and that he will respect those rulings.

“The president should not get mixed up in the decisions of judges and justices,” Colom said. The nation’s supreme court approved the extradition request in August.

Portillo is charged in a New York federal court with money laundering and embezzling $1.5 million donated by Taiwan to buy schoolbooks for Guatemalan children. He allegedly deposited the money in Miami and transferred it to a Paris account in the name of his ex-wife and daughter.

After leaving office in 2004, Portillo fled to Mexico where he was granted a work visa to serve as financial adviser for a construction materials company.

He was extradited from Mexico to Guatemala in 2008 to face the embezzlement charges at home and remained free until his arrest on Jan. 26, 2010. Portillo was captured at a beach preparing to flee Guatemala by sea.

Colom did not specify a date for the extradition. The remaining administrative processes could take several months.

PRI advisor Judge Garzon against drug decriminalization and money laundering.

Carbonero — Sun, 04 Sep 2011 17:45:57 +0000

The Moreira Brothers (leaders of PRI) and Spanish Judge Baltasar Garzón

Besides being an advisor of the Organization of American States (OAS), and directly involved in the peace process in Colombia, Spanish judge Baltasar Garzón has been very active in other matters related to Latin American politics.

Recently in Mexico, Judge Garzón was invited to an international Conference on Money Laundering. During the event, the famous Spanish judge said “the fight against money laundering should be rigorous and global, otherwise it will fail”.
Global War on Money Laundering .- During the closing ceremony of the Forum “Democratic legality, Ethics, Human Rights and Security” held at the Mexican Congress , Judge Garzón also said that “money laundering is an international phenomenon so it must be combatted on a multilateral basis as it would otherwise be a failure.”
Legislators, officials and Mexican specialists agreed with Garzon on the importance of globally combatting organized crime and money laundering, and also agreed on fighting it both locally and internationally.

Garzon recommended Mexico modernize their traditional organized crime research and invest in new technology to combat money laundering.

“A money laundering law must be rigorous and it is urgent to establish launderer´s behaviors and mechanisms, such as those imposed in other countries,” he said.

Against decriminalization of drug trafficking.- In a press conference after the event, Judge Garzon spoke against drug decriminalization. He said that in Mexico decriminalization is not going to end organized crime, because besides drugs, cartels and criminal gangs are also engaged in kidnapping, extortion, trafficking and vehicle theft.

First, Garzón said, is necessary to create “a joint policy of prevention to reduce the risk of consumption.”

Judge Garzón also advisor of the opposition Mexican Political Party PRI (Partido Revolucionario Institucional) .-

Spanish Judge Baltasar Garzon is active in Mexico.

Humberto Moreira, national president of the Partido Revolucionario Institucional (PRI) held the first of several meetings that will take place with judge Baltasar Garzon as advisor of the PRI, in order to polish the PRI’s political platform on the issue of human rights, public safety and combatting organized crime.

The National Executive Committee (NEC) of the PRI, as well as the former governor of Hidalgo, Miguel Ángel Osorio Chong, secretary of political operations of the PRI, are having this round of consultations with Judge Garzón as well as other international experts to ensure a viable anti-crime proposal.

During the meeting, Garzón declared himself in favor of strengthening institutional frameworks against drug trafficking before talking about new laws. Garzón has a more practical and hands on point of view.
Moreira Valdes (PRI) said in an interview that the party’s central concern is how to ensure respect for human rights in the fight against organized crime.

He also revealed that this is the third meeting he has with Baltasar Garzon, in an attempt to define the direction of the security strategy that the country should take.

Spanish judge Baltasar Garzon also called for strict control of rating agencies Moody´s. Standard Poor´s and Fitch.-

Last Tuesday, Judge Garzón called on all countries to establish control and oversight over the rating agencies to avoid possible “organized criminal activity” affecting the investment markets and countries.
“There is no control on them on such activities that have become landmarks,” said the judge at the close of the forum “democratic legality, ethics, human rights and security” that took place in chamber of Deputies in Mexico City.
International agencies such as Moody’s, Standard & Poor’s and Fitch, are allegedly responsible for aggravating the global financial crisis by lending support to controversial downgrades against many countries.
“I’m disturbed by the justice system´s inaction from the various judicial actors” on the role and control of the rating agencies in today’s volatile markets that “are about to bring many countries to ruin,” he said.
Garzon said he was not sure that these agencies perform criminal acts but said the rating agencies “should have a strict regulation” to be sure that “there is no organized criminal activity around the constant speculation on markets and investments.”
Addressing more than a hundred legislators, academics, officials and experts from Mexico and other countries, Garzon said that economic and financial crime is “produced by large corporations through mechanisms of corruption” and market operations.
The judge said that the actions of the rating agencies “can lead countries to ruin or a rising cost of public debt or external debt, to unsuspected limits.”

Description of Mexico´s Drug Cartels.

Carbonero — Tue, 30 Aug 2011 08:04:32 +0000

Joaquín -Chapo- (Shorty) Guzmán, druglord of Sinaloa Cartel

Mexico’s network of drug cartels is nebulous and complex, with organizations merging, splintering and shifting alliances in their quest to control drug-trafficking routes. Below is a rough overview of some of the major groups involved in the country’s drug trade, although there are numerous other affiliate groups and smaller players. READ MORE HERE

DEA and colombian police captured Chapo Guzman´s money launderer.

Carbonero — Thu, 11 Aug 2011 00:22:47 +0000

Dolly Cifuentes Villa is accused of working for Chapo Guzman and Sinaloa Cartel

Police in Colombia have arrested Dolly Cifuentes Villa in a wealthy neighbourhood of Medellin. Police say she laundered money for the Sinaloa drug cartel in Mexico.

Head of the Colombian police Gen Oscar Naranjo said Ms Cifuentes, 47, was “a high-ranking link between Colombian and Mexican drug dealers”.

According to the US DEA, which took part in the investigation leading to Ms Cifuentes’ arrest, she managed 32 companies in Colombia and 17 abroad, including in Panama, Mexico, Brazil and the US.

The police chief said her arrest would make it more difficult for the Sinaloa cartel to launder its multi-million dollar profits from the drugs trade.

Gen Naranjo said that after the killing of her brother Francisco in 2007 (he worked for Pablo Escobar) , Dolly Cifuentes became a key associate of Joaquin “Shorty” Guzman, the most wanted drug dealer in Mexico.

Colombia´s yearly money laundering exceeds 8 billion dollars.

Carbonero — Sat, 30 Jul 2011 12:01:55 +0000

Money laundering exceeds 8 billion dollars in Colombia, every year.

Attorney General’s Office, Viviane Morales, said yesterday in Beijing that the growth of money laundering in Colombia has taken a rapid pace and now exceeds 3% of the country’s gross domestic product, or approximately 8 billion dollars per year.

She said these are the results of a study made by the colombian Information and Financial Analysis Institute.

“The International Monetary Fund IMF found that between 2006 and 2011 the average money laundering worldwide was between 2% and 5% of GDP,” said Morales, to emphasize that money laundering has become a regressive tax paid by Colombians.

The Pan American Congress on Risk Money Laundering and Financing of Terrorism, said the state lacks the capacity to tackle this crime, and the american countries should adopt policies to combat this crime.

The president of Asobancaria (Banking Association of Colombia) , Maria Mercedes Cuellar, said that a tax of 4 every 1000 in the colombian banking sector encouraged to money laundering. “… this is of the main sources of money laundering in this country, and that makes is the fact that there is such a tax because it leads people to pay in cash,” she said.

The President of the Bankers Association also said that if all transactions were through the banking system, it could easily follow the path of any transaction.