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Judge: Andrew L. Carter Jr.
Court: United States District Court for the Southern District of New York (New York County)
Plaintiff's Attorney: United States District Attorney’s Office, New York, New York
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Description: New York, New York money laundering charged criminal defense lawyer represented Sefira Capital LLC (“Sefira”) and 31 subsidiary corporations, which own high-end commercial and residential real estate throughout the United States. The Government’s complaint, which was filed on January 8, 2021, alleged that the defendant corporations accepted millions of dollars of narcotics proceeds laundered through the shadow financial system commonly known as the Black Market Peso Exchange, for investment in various real estate ventures.
In the stipulation of settlement filed with U.S. District Judge Andrew L. Carter Jr. today, which is still subject to approval by the Court, the defendant corporations agree to forfeit $29 million to resolve the Government’s claims, representing approximately $22.5 million previously seized from Sefira and its subsidiaries, and an approximately $6.5 million payment in lieu of the forfeiture of certain real estate interests. As part of the settlement, Sefira agreed to conduct reasonable due diligence on future investors, and not to accept investment funds from any source other than the actual investor.
A proposed judgment of forfeiture with U.S. District Judge George B. Daniels, covering $23.2 million seized from Hampus Assets, Inc., and Kaunas Assets Corp. in connection with their acceptance of millions of dollars of narcotics proceeds laundered through the Black Market Peso Exchange. Hampus Assets and Kaunas Assets previously entered into a settlement consenting to the forfeiture of the funds, agreeing to conduct reasonable due diligence on future deposits into bank accounts under their control, and to refrain from conducting certain cross-border money transfers.
Acting Manhattan U.S. Attorney Audrey Strauss said: “The Black Market Peso Exchange facilitates the laundering of vast sums of drug trafficking proceeds generated in the U.S., enabling the conversion of U.S. dollars into the currencies of drug trafficking organizations’ countries. The forfeiture filings announced today signal not only the surrender of more than $50 million in laundered proceeds, but also the agreement of corporate defendants to exercise due diligence to ensure they are not assisting in or facilitating money laundering.”
DEA Acting Administrator Timothy J. Shea said: “The alleged laundering of millions of dollars of illicit proceeds shows the incredible profit generated by ruthless drug cartels who only care about money and power, not the suffering of Americans or devastated communities left behind. The DEA’s unique ability to infiltrate money laundering organizations is essential to illuminating the global networks used to repatriate drug proceeds around the globe. Money is the lifeblood of the cartels, and DEA, together with our law enforcement partners, is committed to identifying, targeting, and prosecuting these organizations to protect the American people.”
The Government lawsuits alleged as follows:
The Black Market Peso Exchange allows drug trafficking organizations to transfer narcotics proceeds from the United States to the country in which they operate while concealing the source and nature of the funds. Drug trafficking organizations will sell bulk United States currency earned from their drug operations in the U.S. to money laundering brokers at a discount, in exchange for payment in the home country or countries of the drug trafficking organization in their local currency. To finance the transactions, the brokers will purchase bulk currency in the local currency of the drug trafficking organizations, typically from individuals who wish to transfer money to the United States while avoiding the banking system. The brokers pay these individuals by depositing the U.S. dollar drug proceeds into U.S.-based shell accounts, and then transferring them to accounts controlled by the individuals, or for their benefit.
As part of an investigation of international money laundering, the DEA used confidential sources to facilitate transactions on the Black Market Peso Exchange to uncover persons engaged in illegal activity and develop evidence for criminal prosecutions. As part of the DEA undercover operation, confidential sources bought narcotics proceeds on the Black Market Peso Exchange, and then transferred those funds to U.S.-based accounts in the United States at the direction of money laundering brokers.
Sefira is a Florida-based boutique investment company that has raised over $100 million in capital from various investors (“Sefira Investors”) to invest in real estate projects primarily in the Southeastern United States. From 2016 to 2019, Sefira or its subsidiaries received millions of dollars in criminal proceeds from certain Sefira Investors as part of an effort by drug trafficking organizations and others to launder the criminal proceeds through the Black Market Peso Exchange.
Between January 2018 and January 29, 2019, the DEA transferred millions of dollars of narcotics proceeds to certain Sefira subsidiaries at the instruction of money-laundering brokers. These funds were wired from DEA undercover accounts that were not titled in the name of, or under the control of, any particular Sefira Investor. Sefira accepted these funds without inquiring as to the source of ownership of these accounts or funds.
In addition, millions of dollars of criminal proceeds were used to fund other Sefira Investors’ investments in Sefira. Sefira ignored similar red flags for those investments, including discrepancies between the purported investment amount and the actual amount Sefira received from Sefira Investors, as well as discrepancies between the purported Sefira Investors and the entities sending the investments to Sefira.
Between July 2018 and February 2019, Hampus Assets received millions of dollars from a shell company used to transfer narcotics proceeds on the Black Market Peso Exchange. These deposits came in large amounts in rapid succession and did not follow an observable business pattern. In October 2018, Hampus Assets transferred a portion of these proceeds to Kaunas Assets Corp.
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Ms. Strauss praised the outstanding investigative work of Special Agents from the DEA New Jersey, Enforcement Group 2.
This case is being handled by the Office’s Narcotics and Money Laundering and Transnational Criminal Enterprises Units. Assistant United States Attorneys Aline R. Flodr, Stephanie Lake, and Sheb Swett are in charge of the case.
Outcome: Civil Forfeiture Claims Against Over $50 Million Laundered Through Black Market Peso Exchange