Date: 09-08-2018

Case Style:

United States of America v. Lahkwinder Singh

Case Number: 16cr729-BAS

Judge: Cynthia Bashant

Court: United States District Court for the Southern District of California (San Diego County)

Plaintiff's Attorney: Orlando B. Gutierrez and Orlando B. Gutierrez

Defendant's Attorney: Robert Boyce

Description:

San Diego, CA - Postal Annex Owner Sentenced for Structuring Currency Transactions

Lahkwinder Singh was sentenced in federal court to 36 months in federal prison and a forfeiture of $1,955,521 to the United States for structuring approximately $2,955,521 in currency transactions with domestic financial institutions. The 36-month sentence is one of the longest imposed in the Southern District of California for a structuring conviction. Singh’s closely held corporation, Lovely Singh, Inc., was ordered to forfeit $1,000,000, and serve a 5-year term of probation.

Singh and Lovely Singh, Inc., owned and operated Postal Annex franchises in Lemon Grove, California. Singh also acted as the Chief Financial Officer of Lovely Singh, Inc. In 2006, Singh began operating the Postal Annexes as an agent of Western Union, which required that he operate under a federal license as a money transmitting business, and required that the Postal Annexes maintain a comprehensive Bank Secrecy Act/Anti-Money Laundering (“BSA/AML”) program to ensure that the Postal Annexes were vigilant in preventing unlawful funds from passing through Western Union, and the financial system at large. Singh was the designated BSA/AML Officer responsible for ensuring the Postal Annexes complied with all US financial and banking laws.

Instead of protecting the financial system, by no later than 2011, Singh engaged in a multi-year pattern of cash transactions below the $10,000 threshold to avoid detection by banks and law enforcement, with the intent to deposit Lovely Singh, Inc.’s cash proceeds free from scrutiny.

As Singh and Lovely Singh, Inc. admitted in each of their plea agreements, Singh and his co-defendant distributed Schedule II controlled substances from the Postal Annexes to persons located throughout the United States. Couriers smuggled controlled substances into the United States from Mexico, and delivered them to the Postal Annexes. Over the course of 2011 through 2016 Singh admitted that he was aware of a high probability that hundreds of packages sent from the Postal Annexes contained a prohibited controlled substance, and he deliberately avoided learning the truth of their contents.

As he further admitted in his plea agreement, Singh structured and attempted to structure $2,955,521 of currency transactions over the course of 469 cash deposits at several domestic financial institutions such as Bank of America, N.A. and Wells Fargo Bank, N.A. Singh conducted multiple deposits of less than $10,000 in cash on the same day, and over the course of several business days, into at least 19 different bank accounts with the purpose of avoiding a Currency Transaction Report, which is the report a financial institution must file for cash deposits exceeding $10,000 during any banking day.

The structured cash deposits included cash received in return for shipping the controlled substances from the Postal Annexes stores, as well as Western Union money transfer funds.

At sentencing, Judge Bashant stated that, with his millions of dollars in structured deposits, Singh “knew exactly what he was doing” – namely “avoiding detection from the government … for shipping drugs” out of the Postal Annex. The sentence imposed, as Judge Bashant stated, serves as a “very important deterrent” to third-party money launderers who are the gateway to the financial system, who like Singh, are engaged in playing a “shell game” of transactions.

This case was a joint investigation with IRS-Criminal Investigation, HSI, DEA, U.S. Postal Inspection Service and California DOJ.

“The U.S. mail is not a delivery service for drug traffickers, and our banking system is not meant to launder millions of dollars of drug money,” said U.S. Attorney Adam Braverman. “Together with our law enforcement partners we have put a stop to this brazen scheme and kept our institutions from being exploited by criminals.”

Postal Inspector in Charge Nichole Cooper stated, “Postal Inspectors and our law enforcement partners will vigorously investigate, arrest, and prosecute anyone who willfully allows the introduction of a controlled substance into the U.S. Mail. Today’s sentencing sends a strong message to drug traffickers that Postal Inspectors stand ready to protect the sanctity of the mail.”

“In this investigation, HSI and our law enforcement partners uncovered a sophisticated financial scheme aimed at providing cover for cash transactions that were tied to the illicit distribution of controlled substances in cities throughout the United States,” said Dave Shaw, HSI Special Agent in Charge in San Diego. “HSI continues to remind the community of the serious public health threat, as well as warn individuals who put consumers at risk for their own financial gain. We are committed to working closely with all of our law enforcement partners, both domestic and abroad, to prevent counterfeit drugs from being smuggled into the U.S. and distributed illegally over the internet.”

“Lahkwinder Singh thought he had the perfect scam going when he started using his postal annex to hide money earned by drug traffickers from the IRS," said Special Agent in Charge R. Damon Rowe, IRS Criminal Investigation Los Angeles Field Office. "Thanks to the hard work of IRS CI special agents and their law enforcement partners, Singh is now paying the price for his scheme and drug traffickers have lost another venue to launder their ill-gotten gains.”

“Mr. Singh utilized a legitimate mail delivery business to distribute prescription drugs, including fentanyl and Oxycontin, throughout the United States in order to avoid detection by law enforcement,” said DEA Special Agent in Charge Karen Flowers. “Mr. Singh’s actions directly contributed to the devastation of our American communities caused by the opioid epidemic. DEA will continue to investigate those seeking to profit from the illegal distribution of drugs and destruction of our communities.”

“Trafficking pharmaceutical drugs and illegally selling them without a prescription is dangerous and will not be tolerated,” said Attorney General Becerra. “Let this sentence send a message: if you attempt to unlawfully manipulate our financial system and fuel prescription drug abuse for a quick buck, federal and state law enforcement will hold you accountable."

DEFENDANTS Case Number 16cr729-BAS

Lahkwinder Singh Age: 59 Scripps Ranch, CA

Lovely Singh, Inc. California Corporation

SUMMARY OF CHARGES

Structuring Currency Transactions with One or More Financial Institutions – Title 31, U.S.C., Sections 5324(a)(3), (d)(2).

Maximum penalty for Singh: Ten years in prison, $500,000 fine, forfeiture of all property, real or personal, involved in the offense and any property traceable thereto, and a term of supervised release of up to three years.

Maximum penalty for Lovely Singh, Inc.: $1 million fine, forfeiture of all property, real or personal, involved in the offense and any property traceable thereto, and a term of probation of up to five years.

AGENCIES

Internal Revenue Service

Homeland Security Investigations

Drug Enforcement Administration

U.S. Postal Inspection Service

California Department of Justice

Outcome: Defendant was sentenced to 36 months in federal prison and a forfeiture of $1,955,521.

09/07/2018 162 SENTENCING SUMMARY CHART by Lahkwinder Singh (Attachments: # 1 Proof of Service)(Boyce, Robert) (Entered: 09/07/2018)
09/07/2018 163 Minute Entry for proceedings held before Judge Cynthia Bashant: Sentence With PSR Hearing held on 9/7/2018 for Lahkwinder Singh (1). Count 6ss, Dft committed to the BOP for a term of 36 months, supervised release for 3 years, no fine, assessment $100, forfeiture $1,955,521 per order filed 2/13/2018, appeal rights waived. Dft to self-surrender to the US Marshal or designated institution by 10/24/2018 at 12:00 PM (Noon). Bond Exoneration Hearing set for 10/29/2018 09:00 AM in Courtroom 4B before Judge Cynthia Bashant. Count(s) 1, 1s, 1ss, 2s-5s, 2ss-5ss, 6s, Government motion to dismiss remaining and underlying counts granted; (Court Reporter/ECR Dana Peabody). (Plaintiff Attorney Orlando Gutierrez AUSA and Daniel Silva AUSA). (Defendant Attorney Robert Boyce CJA). (no document attached) (sxm) (Entered: 09/07/2018)

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