Accused LA cartel associates charged for money laundering
Two dozen accused Los Angeles-based associates of Mexico’s Sinaloa Cartel are facing federal money-laundering charges alleging a scheme to hide the source of more than $50 million in drug proceeds, officials said on Tuesday, June 18.
Joel Martinez-Reyes, 45, of East Los Angeles and others hid the source of the cash, including structuring assets to avoid financial reporting requirements and the purchase of cryptocurrency, according to an indictment filed in L.A. federal court.
The investigation — dubbed Operation Fortune Runner — resulted in charges of conspiracy to aid and abet the distribution of cocaine and methamphetamine, conspiracy to launder monetary instruments, and conspiracy to operate an unlicensed money-transmitting business.
Prosecutors say a Sinaloa Cartel-linked network collected and, with help from a San Gabriel Valley-based money-transmitting group with links to Chinese underground banking, processed large amounts of drug proceeds in U.S. currency in the Los Angeles area.
They then concealed their drug-trafficking proceeds, prosecutors say, and made the proceeds generated in the United States accessible to cartel members in Mexico and elsewhere.
“Relentless greed, the pursuit of money, is what drives the Mexican drug cartels that are responsible for the worst drug crisis in American history,” Anne Milgram, a Drug Enforcement Administration administrator, said in a statement.
“This DEA investigation uncovered a partnership between Sinaloa Cartel associates and a Chinese criminal syndicate operating in Los Angeles and China to launder drug money,” she said. “Laundering drug money gives the Sinaloa Cartel the means to produce and import their deadly poison into the United States.”
The investigation led to the seizure of about $5 million in narcotics proceeds, 302 pounds of cocaine, 92 pounds of methamphetamine, 3,000 ecstasy pills, 44 pounds of magic mushrooms, ketamine, three semi-automatic rifles with high-capacity magazines, and eight semi-automatic handguns, according to the U.S. Department of Justice.
Martinez-Reyes and others allegedly delivered hundreds of thousands of dollars in cash to the Chinese money exchange and associated organizations to be laundered for a fee.
If convicted of all charges, each defendant faces 10 years to life in prison.