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January 17, 2013

Los Angeles Check Cashing Store, Head Manager and Compliance Officer Sentenced for Violating Anti-Money Laundering Laws

Filed under: California Defense Attorney — Tags: , , — fayarfa @ 7:43 pm

Sentences Handed Down in Enforcement Initiative Aimed at Check Cashers that Violated the Bank Secrecy Act

LOS ANGELES – A Los Angeles check cashing store, its head manager and its designated anti-money laundering compliance officer were sentenced today for failing to follow federal reporting and anti-money laundering requirements in relation to more than $8 million in transactions.

G&A Check Cashing, a business located in the Westlake section of Los Angeles; its manager, Karen Gasparian; and its compliance officer, Humberto Sanchez, were sentenced today by United States District Judge John F. Walter for violating the Bank Secrecy Act (BSA).

Judge Walter sentenced Gasparian, 31, of Canyon Country, to five years in federal prison. In sentencing Gasparian, Judge Walter rejected the defendant’s arguments that he had simply failed to comply with complicated regulatory schemes. “It’s obvious he knew exactly what he was doing – laundering money,” Judge Walter said.

Sanchez, 51, of Alhambra, was sentenced to eight months in prison. And G&A was ordered to pay a fine of $962,932 as part of two-year period of probation. In addition, Gasparian and G&A were ordered to forfeit $240,733, which represents the profits they earned on funds going through G&A for which currency transaction reports (CTRs) were not filed.

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November 26, 2012

ATTORNEY, ACCOUNTANT, AND TWO ADMINISTRATORS CONVICTED OF REVENUE AND TAX CHARGES IN $154 MILLION MEDICAL INSURANCE FRAUD SCHEME

Filed under: California Defense Attorney — Tags: , , — fayarfa @ 8:31 pm

* Additional felony fraud counts for the defendants will be tried at a later date

SANTA ANA - An attorney, accountant, and two administrators were convicted today of revenue and tax fraud for their roles in the largest medical fraud prosecution in the nation for recruiting over 255 healthy patients to undergo unnecessary and dangerous surgeries to fraudulently bill medical insurance companies. This trial involved the failure to file tax returns and under-reporting income to state tax authorities. The court bifurcated the case due to its size and volume and additional fraud charges remain pending and another trial date will be set for those counts. The defendants are scheduled to be sentenced Dec. 20, 2012, in Department C-41, Central Justice Center, Santa Ana.

Roy Chester Dickson, 64, Yorba Linda, Unity’s attorney, was found guilty by a jury of two felony counts of filing a false personal tax return and faces a maximum sentence of three years and eight months in state prison for these counts. Dickson faces 101 additional felony counts which include two counts of conspiracy, eight counts of capping or paying for referrals, 30 counts of grand theft, 30 counts of insurance fraud, 30 counts of making false and fraudulent claims, one count of money laundering, and white collar sentencing enhancements for taking over $2.5 million on the fraud counts. These counts will be tried at a later date.

Andrew Robert Harnen, 58, Rosemead, Unity’s accountant, was found guilty by a jury of three felony counts of filing a false tax return and six counts of failing to file tax returns. He faces a maximum sentence of eight years and four months in state prison for these counts. Harnen faces 101 additional felony counts which include two counts of conspiracy, eight counts of capping or paying for referrals, 30 counts of grand theft, 30 counts of insurance fraud, 30 counts of making false and fraudulent claims, one count of filing a false tax return, and white collar sentencing enhancements for taking over $2.5 million on the fraud counts. These counts will be tried at a later date.

Dee Francis, 63, a Unity administrator, was found guilty by a jury of one felony count of filing a false tax return and six counts of failing to file tax returns. She faces a maximum sentence of seven years in state prison for these counts. Francis faces 102 additional felony counts which include two counts of conspiracy, eight counts of capping or paying for referrals, 30 counts of grand theft, 30 counts of insurance fraud, 30 counts of making false and fraudulent claims, one count of filing a false tax return, two counts of failing to file tax returns, and white collar sentencing enhancements for taking over $2.5 million on the fraud counts. These counts will be tried at a later date.

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November 20, 2012

Australian Jockey Sentenced to Four Years in Prison for Laundering Proceeds of Multi-Million Dollar Real Estate and Loan Fraud

Filed under: California Defense Attorney — Tags: , — fayarfa @ 9:55 pm

RIVERSIDE, California – An Australian man who once worked as a jockey has been sentenced to four years in federal prison for concealing the proceeds of a loan fraud scheme that caused victims to lose more than $5 million in less than eight months.

Christopher J. Woods, 53, of Sydney, was sentenced yesterday by United States District Judge Virginia A. Phillips. In addition to the prison term, Judge Phillips ordered Woods to pay $3,510,000 in restitution to victims of the scheme and to pay a $10,000 fine.

Woods pleaded guilty in November 2011 to conspiracy to commit money laundering and two counts of money laundering, admitting that he conspired with others to transfer stolen money in ways that would prevent victims of a fraud from finding it, including funneling the money through multiple bank accounts in Hong Kong before it was returned to Woods’ personal bank account in Los Angeles.

The underlying loan fraud scheme was perpetrated by brothers Henrik and Hamlet Sardariani, who worked with an escrow officer named Wanda Tenney. The Sardariani brothers defrauded private money lenders by falsely assuring them that the loans they were making were safe, when in fact the brothers had no intention of paying the loans back. Tenney permitted the Sardarianis to use her escrow company to lull the victims into believing their loans were secured.
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November 1, 2012

MAN SENTENCED TO 10 YEARS IN PRISON FOR STEALING OVER $280,000 FROM WOMAN IN FAKE GOLD INVESTMENT SCHEME

Filed under: California Defense Attorney — Tags: , , , — fayarfa @ 4:59 pm

SANTA ANA - A man was convicted and sentenced to 10 years in state prison today for stealing over $280,000 from a woman in a fake gold investment scheme. William Scott Spalding, 47, Irvine, pleaded guilty to 13 felony counts of money laundering, three felony counts of grand theft and one felony count of first degree residential burglary. He admitted to sentencing enhancement allegations for committing a theft over $100,000, committing an aggravated white collar crime over $100,000, property loss over $200,000, and laundering money exceeding $150,000. Spalding was also ordered to pay restitution and a fine of $576,000.

On March 6, 2011, Spalding visited 51-year-old Jane Doe, whom he met through an acquaintance, at her home. He claimed to be an investor and promised large returns on her investment if she bought gold from him.

On March 13, 2011, Spalding received $58,000 in cash from Jane Doe. The next day, Spalding received another $180,000 from Jane Doe through a wire transfer. On March 23, 2011, Spalding received an additional $50,000 from Jane Doe. Spalding distributed the money across multiple personal bank accounts and spent the money on expensive personal purchases including a high-end Mercedes-Benz and payments on a house. Spalding used the money for personal use and never purchased the gold he promised or returned any of the money to Jane Doe.

October 5, 2012

Los Angeles Check-Cashing Business and Man Who Was Supposed to Lead its Anti-Money Laundering Efforts Plead Guilty to Violating Federal Anti-Money Laundering Laws

Filed under: Los Angeles Criminal attorney — Tags: , — fayarfa @ 7:30 pm

5 Defendants in L.A. Have Been Convicted in Anti-Money Laundering Crackdown

LOS ANGELES – A Los Angeles check-cashing store and its designated anti-money laundering compliance officer pleaded guilty today to federal charges, including violating the Bank Secrecy Act.

G&A Check Cashing, a business located in the Westlake section of Los Angeles, California, and Humberto Sanchez, 53, of El Monte, pleaded guilty this morning before United States District Judge John F. Walter. G&A pleaded guilty to conspiracy and failing to maintain an effective money-laundering policy. Sanchez pleaded guilty to failing to maintain an effective money laundering policy.

Under federal anti-money laundering laws, financial institutions, including check- cashing businesses, are required to file a CTR for any transaction involving more than $10,000 in currency. As part of the CTR, the financial institution is required to verify and accurately record the name and address of the individual who conducted the currency transaction, the individual on whose behalf the transaction was conducted, as well as the amount and date of the transaction. CTRs are important law enforcement tools for uncovering criminal activity. Financial institutions are also required to maintain and enforce policies to prevent money laundering.

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October 2, 2012

SoCal Toy Company Pleads Guilty in Money Laundering Conspiracy

Filed under: Los Angeles Criminal attorney — Tags: , , — fayarfa @ 6:05 pm

LOS ANGELES – A Los Angeles-area toy wholesaler, its two owners, and the company’s primary bookkeeper pleaded guilty today to federal charges related to their participation in an elaborate scheme known as a Black Market Peso Exchange, which enables drug trafficking organizations in Mexico and Colombia to launder proceeds from their drug sales.

The defendants that pleaded guilty today in United States District Court are:
the Industry-based Woody Toys, which pleaded guilty to one count of money laundering conspiracy and is scheduled to be sentenced on November 19;the owners of Woody Toys – Jia “Gary” Hui Zhou, 43, and his wife, Dan “Daisy” Xin Li, 43, both of Diamond Bar – who pleaded guilty to conspiring to structure currency transactions with a U.S. financial institution to avoid the filing of a Currency Transaction Report, and who are scheduled to be sentenced on February 11; and Woody Toys’ primary bookkeeper – Kit Yee “Ella” Lam, 52, of Diamond Bar – who pleaded guilty to failing to file a required Internal Revenue Service Form 8300 showing the receipt of more than $10,000 in cash from Woody Toys’ Mexican customers, and who is scheduled to be sentenced on January 28.

All four defendants pleaded guilty before United States District Judge R. Gary Klausner.

While Zhou and Li each face statutory maximum sentences of five years in federal prison, plea agreements filed in this case call for Zhou to be sentenced to two years in federal prison, and for Li to be sentenced to one year in prison. Judge Klausner has not yet indicated if he will accept the binding plea agreements.

As part of their plea agreements, the couple has agreed to forfeit to the government $2 million in proceeds allegedly derived from the scheme.

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August 7, 2012

Mexican Toy Dealer Pleads Guilty in Drug Money Laundering Case

Filed under: Los Angeles Criminal attorney — Tags: , — fayarfa @ 7:55 pm

Plea Part of Probe into L.A. Toy Company Tied to ‘Black Market Peso Exchange’

LOS ANGELES – A Mexican businessman pleaded guilty today in federal court to conspiring with the owners of a Los Angeles-area toy wholesaler to launder thousands of “narco dollars” for drug trafficking organizations in Mexico.

Luis Ernesto Flores Rivera, 54, of Guadalajara, Mexico, faces up to 20 years in prison after pleading guilty to one count of conspiring to launder financial instruments. As a result of today’s guilty plea, Flores becomes the first defendant to be convicted in Los Angeles on money laundering charges arising from this type of scheme, which is commonly referred to as a “black market peso exchange.”

Flores was among eight defendants, including Woody Toys in the City of Industry, indicted in April for allegedly using “structured” cash deposits in the United States to launder illicit proceeds generated by drug trafficking organizations based in Mexico and Colombia. A “structured” deposit is less than $10,000 and is designed to avoid laws that require any cash transaction of at least $10,000 to be reported to federal authorities.

According to his plea agreement, between 2008 and 2011, Flores conspired with Woody Toys to launder between $70,000 and $120,000.

“Money laundering is an nefarious practice that plays an integral role in narcotics trafficking,” said United States Attorney André Birotte Jr. “Here, Mr. Flores stooped to using children’s merchandise as part of a scheme to hide illegal proceeds – a practice that serves to demonstrate how desperate drug trafficking organizations are to evade law enforcement’s efforts to cut off their flow of money.”

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July 11, 2012

Former Atascadero Real Estate Developer Charged with Defrauding Investors in Central Coast Real Estate

Filed under: California Defense Attorney — Tags: , , , — fayarfa @ 5:36 pm

LOS ANGELES—A real estate developer who formerly resided in Atascadero was indicted today on federal fraud and money laundering charges that accuse him of bilking investors who put money into Central Coast real estate projects—money that was siphoned off for other purposes, including maintaining a lavish lifestyle.

Kelly Gearhart, 50, who currently resides in Wadsworth, Ohio, was named in a 16-count indictment returned today by a federal grand jury. The indictment charges Gearhart with 10 counts of mail fraud, four counts of wire fraud, and two counts of money laundering.

The indictment alleges that Gearhart fraudulently solicited investments in specific real estate development projects by falsely promising that he would use the funds to develop those projects. Gearhart also told investors that their investments—which he called loans and promised would be paid back with interest—were secured by specific lots.

The indictment alleges that Gearhart failed to disclose a number of things to investors, specifically, that he was using victims’ funds to pay for his and his wife’s lavish living expenses, that he was using their money to develop different real estate projects than those intended by the victims, and that he was using victims’ money to make interest payments to other investors.

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May 16, 2012

Lawyer for Coachella Valley Indian Tribe and Three Others Charged in Bribery Scheme Related to Projects at Spotlight 29 Casino

Filed under: Federal Crimes Defense Attorney — Tags: , — fayarfa @ 4:51 am

LOS ANGELES—An attorney for the Twenty-Nine Palms Band of Mission Indians is among four people who have been indicted on federal bribery and money laundering charges for allegedly participating in scheme in which associates of the lawyer hired to provide assistance to the tribe paid kickbacks to the attorney.

The 48-count grand jury indictment returned yesterday afternoon names:

Gary Edward Kovall, 66, of Ely, Minnesota, a licensed California attorney who acted as legal counsel for the tribe;
David Alan Heslop, 74, of Templeton, who, on Kovall’s recommendation, was hired by the tribe to oversee some tribal business;
Paul Phillip Bardos, 57, of Rancho Cucamonga, a general contractor; and
Peggy Anne Shambaugh, 56, of Ely, Minnesota, who is Kovall’s wife.
All four defendants have agreed to appear for arraignments tomorrow in United States District Court in Los Angeles.

According to the indictment, Kovall advised the tribe to create a limited liability company to purchase real estate, and the attorney convinced the tribe to hire Heslop as the company’s manager. Kovall and Heslop then recommended that the tribe hire Bardos to act as the tribe’s “owner’s representative” in several construction projects at the Spotlight 29 Casino. When additional construction or construction oversight became necessary in relation to casino projects, Bardos submitted proposals to perform the work, and Kovall persuaded the tribe to give Bardos the contracts. After being paid by the tribe, Bardos paid kickbacks to Heslop who, in turn, paid kickbacks to Kovall though Shambaugh.

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April 19, 2012

Creators and Operators of On-line Narcotics Marketplace on the TOR Network Arrested on First of Its Kind Federal Indictment Charging Drug Trafficking in 34 Countries and 50 States

Filed under: Federal Crimes Defense Attorney — Tags: , , — fayarfa @ 4:04 pm

LOS ANGELES - Federal, state, and international law enforcement authorities have arrested eight people who all face federal drug trafficking and money laundering charges stemming from their creation and operation of a “secret” on-line narcotics market place – known as the  “The Farmer’s Market” – which sold a variety of controlled substances to approximately 3,000 customers in 34 countries and 50 states.

This morning, law enforcement authorities in Lelystad, Netherlands, arrested the lead defendant, Marc Willems, at his home.  Yesterday, law enforcement officials in Bogota, Colombia, arrested the second defendant, Michael Evron, a United States citizen who lives in Argentina, as he was attempting to leave Colombia. The remaining defendants, Jonathan Colbeck, Brian Colbeck, Ryan Rawls, Jonathan Dugan, George Matzek, and Charles Bigras were arrested at their respective homes in Iowa, Michigan, Georgia, New York, New Jersey, and Florida.

The 66-page indictment, which was unsealed today, was the result of “Operation Adam Bomb,” a two-year investigation led by agents of the Drug Enforcement Administration’s (DEA) Los Angeles Field Division, with significant assistance by the Netherlands Regional Police Force Flevoland, prosecutors from the International Legal Assistance Center North East Netherlands, United States Department of Justice’s Office of International Affairs, the DEA’s country office in Hague, and the United States Postal Service.  The arrests of the defendants took place due to the cooperation and assistance of the Scottish Crime and Drug Enforcement Agency, the Colombian Central Directorate of the Judicial Police and Intelligence, Migracion Colombia, the United States Postal Inspection Service, and Federal/State/Local authorities in New York, Iowa, Georgia, Florida, New Hampshire, Pennsylvania, Michigan, and New Jersey.

“Illegal narcotics trafficking now reaches every corner of our world, including our home computers,” said United States Attorney André Birotte Jr., whose office is handling the prosecution of the case.  “But the reach of the law is just as long, and the Department of Justice will work with its partners, both nationally and internationally, to bring narcotics traffickers to justice, wherever they may hide.  Working together, we want to make the Internet a safe and secure marketplace by rooting out and prosecuting those persons who seek to illegally pervert and exploit that market.”

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