DOJ Costs Armored Car or truck Provider CEO for Elaborate Plan to Launder Revenue By way of Unlawful Gold | Ballard Spahr LLP

On June 23, 2021, the Division of Justice unsealed a felony complaint and affidavit submitted in the Southern District of Florida that alleges a vast scheme to launder cash as a result of unlawful gold mining.  The DOJ charged Jesus Gabriel Rodriguez, Jr., the CEO and President of Transvalue, Inc., a South Florida-dependent armored auto support, with one particular depend of conspiring to dedicate income laundering.  The affidavit hooked up to the complaint alleges that Rodriguez conspired with staff of a South Florida-dependent gold refining organization to import hundreds of kilograms of illicitly-sourced gold from Curacao truly worth thousands and thousands of dollars, and then use his company’s fleet of armored vehicles to thwart the anti-revenue laundering (“AML”) program of a U.S. valuable metals refinery obtaining the gold.

As we have blogged, gold is an especially productive medium for funds laundering due to the fact it has common and conveniently ascertainable price and is complicated to trace.  Curacao, a Caribbean island with no gold mines, is commonly part of the route for gold illegally mined in, and smuggled out of, South The us (like Venezuela) and Africa.

Gold and Money Laundering

As the affidavit describes, Miami has come to be a significant global gold trading hub for both of those lawful and illegal gold from Latin The usa.  Illegal gold mining is a major difficulty in the course of Latin The usa and in the Andean area.  For case in point, illegal mining has aided add to the destruction of large swaths of the rainforest.  Illegal mining commonly occurs in remote jungle locations and, as a end result, is tricky to police and frequently managed by arranged crime and smuggled alongside the exact same routes as narcotics.  Most of the gold imported to the U.S. enters through Miami Worldwide Airport (MIA) and many significant gold refineries are based mostly in South Florida.

The intercontinental gold trade is a common suggests for lousy actors to launder the proceeds of illegal mining, narcotics, corruption, and other felony proceeds.  Criminals normally trade illegal gold by illicit shell organizations working with fake files.  The gold is ordinarily smuggled as a result of third-bash nations around the world, these as Curacao, and then offered to refineries in the U.S. in an effort and hard work to obscure the true supply, ownership, and origin of gold from foreign and U.S. law enforcement.  In a typical income laundering plan involving gold, criminals get wire transfers to the lender of their choice as soon as the gold comes at the refineries.  On the surface, the payment appears to be for a legitimate gold-sale transaction, and not from any fundamental criminal action.

Rodriguez’s Alleged Plan

The criticism from Rodriguez alleges that from about March 2015 to September 2016, he used his business encounter and contacts to facilitate the importation of hundreds of kilograms of illicitly-sourced gold getting flown into the U.S. from Curacao.  The sellers of the gold were being allegedly co-conspirators situated in the Caribbean and the buyers were co-conspirators dependent in South Florida and Latin America.  These prospective buyers acquired quantity-primarily based commissions by procuring gold for a U.S. valuable metals refinery, NTR Metals (now Elemetals LLC).

In March 2017, NTR pled guilty to one particular felony for failing to keep an suitable AML software that came to light-weight through an ongoing probe into gold imports from South American nations around the world.  As aspect of its plea, NTR agreed to a $15 million good and to cooperate with any ongoing investigations, like, it turns out, the investigation of Rodriguez.

In accordance to the affidavit, Rodriguez purportedly aided his co-conspirators evade the AML insurance policies and treatments of NTR Metals, which includes the refinery’s coverage of not shopping for gold from Curacao.  Specifically, Rodriguez allegedly used his company’s fleet of armored vans to decide up gold shipments at MIA and transport them to several distinctive South Florida gold refineries, such as NTR.  Customs records clearly show that NTR imported about $3.6 billion dollars’ value of gold from Latin The united states and the Caribbean from 2012 by means of 2016.

In 1 purported example of the scheme, NTR imported countless numbers of kilograms of gold among March 2015 and September 2016 that was truly worth a lot more than $141 million into the U.S. from a company positioned in the Cayman Islands (“Company A”).  In each individual instance, the similar gold was noted to U.S. Customs as obtaining originated in Curacao, and a number of times later claimed as obtaining originated in the Cayman Islands.  As part of the plan, Firm A flew gold from Curacao into MIA with couriers who hand-carried the gold on these flights.  Upon arrival to MIA, a customs broker employed by Rodriguez cleared the gold by means of U.S. Customs.  The courier would then quickly board a further flight to the Cayman Islands and transportation the gold there.  Once the gold was in the Caymans, a co-conspirator notified Rodriguez when Corporation A’s cargo was heading to be arriving back in Miami from the Caymans.  Transvalue would then physically transportation the gold from MIA to NTR when it arrived from the Caymans.  If Transvalue sent an bill to NTR for Organization A’s shipments from Curacao to Miami, NTR staff members would get to out to Rodriguez to adjust the invoices and as a result conceal that the gold was coming from Curacao considering that NTR would not acquire gold from Curacao.

On a complex notice, the prison criticism and affidavit cost Rodriguez with conspiring to launder cash, in violation of 18 U.S.C. § 1956(h) by transporting funds (cross-border actions of gold and wire transfers from the United States to the Cayman Islands) in and out of the United States, in buy to boost an underlying specified unlawful exercise (“SUA”), in violation of 18 U.S.C. § 1956(a)(2)(A).  The alleged SUAs that the plan was selling have been the entry of items by signifies of phony statements, in violation of 18 U.S.C. § 542, and solely overseas offenses – precisely, violations of Curacao legislation in opposition to illegal mining, bogus statements in customs declarations, and gold smuggling.  As we have blogged, the governing administration evidently does not have to show below this “international” prong of the money laundering statute that the transported resources at problem earlier have been acquired through the SUA.

Rodriguez is at present out on bail and a preliminary listening to is scheduled for July 23, 2021.  The investigation and prosecution of Rodriguez is portion of “Operation Arch Stanton,” a partnership among federal, point out and area legislation enforcement organizations to recognize and prosecute the optimum-level drug traffickers, dollars launderers, and other transnational felony companies.

Next Post

Daimler speeds up plans to be electric powered-only automaker

Mercedes-Benz operator Daimler is stepping up the speed of its changeover to electrical mobility and designs to largely reduce interior combustion engines right before the finish of the decade. “We are switching from EV initially to EV only,” a high rating executive acquainted with the program explained to Automobilwoche, a sister […]

Subscribe US Now