Audrey Strauss, the United States Attorney for the Southern District of New York, announced today that AMIT AGARWAL, the operator of an international wholesale consumer electronics business based in New Jersey, pled guilty to participating in a conspiracy to operate an unlicensed money transmission business that operated primarily between Colombia and the United States. AGARWAL pled guilty before United States District Judge Paul A. Engelmayer.
Miguel Cespedes, Omar Mogollon, Luis Felipe Gonzalez Arcila, Ivan Rojas Acosta, Alex Barrera Forero, and David Ortiz Villamizar were previously charged in three separate indictments for their roles in the scheme. They were arrested in Colombia, and the United States Government is seeking their extradition to the United States.
U.S. Attorney Audrey Strauss said: “As he admitted today, Amit Agarwal was a key player in a shadow financial network that allowed the movement of drug traffickers’ profits into our banking system and across our borders. Now he awaits sentencing for his crimes.”
According to the Indictments, the superseding Information, and statements made in open court:
From at least in or about June 2018 through at least in or about 2019, AMIT AGARWAL participated in a scheme to operate an unlicensed money transmitting business to move funds between the United States and Colombia, among other places. Among other things, the purpose of the scheme was to enable clients with cash located in the United States to transfer the value of that cash to other countries, principally Colombia, without the need for physically transporting United States currency across an international border or directly depositing large amounts of cash into the legitimate financial system.
To effectuate the scheme, “clients,” i.e., the owners of funds located in the United States, utilized the services of money brokers operating primarily in Colombia (the “Money Brokers”). The Money Brokers offered “contracts” typically requiring (a) the pick-up of United States currency from couriers throughout the United States and the receipt of international wires in the United States, and (b) the delivery of a corresponding amount of pesos in Colombia to the Money Brokers. In exchange for successfully delivering on a contract, the Money Brokers earned a commission, taken from the pesos received by them in Colombia. The person(s) with whom the Money Brokers contracted to arrange for the pick-up and receipt of United States currency also received a commission taken from the pesos received by the Money Brokers in Colombia. Although the payment of commissions from the funds collected pursuant to a contract meant that the clients did not receive the full value of the funds that the clients owned in the United States, this scheme enabled the clients to avoid the risks of having large quantities of cash detected at international borders and to avoid triggering financial reporting requirements.
Cespedes, Mogollon, Gonzalez, Rojas, Barrera, and Ortiz engaged in the scheme as Money Brokers. As Money Brokers, working at times independently and at times together, they offered and executed upon multiple contracts requiring the pick-up of funds throughout the United States, and the delivery of a corresponding value of pesos to them in Colombia. In exchange for their work as Money Brokers, they received a commission taken from the pesos delivered to them in Colombia, as did the individuals with whom they contracted.
AGARWAL was the chief executive officer of a consumer electronics products business based in East Hanover, New Jersey (the “Agarwal Electronics Business”). Among other things, the Agarwal Electronics Business exported consumer electronics to purchasers throughout the world, including purchasers located in Colombia. In connection with its business activities, the Agarwal Electronics Business maintained a bank account in the United States, controlled and operated by AGARWAL (the “Agarwal Bank Account”).
Typically, as part of the scheme, the funds collected in the United States pursuant to contracts offered by Cespedes, Mogollon, Gonzalez, Rojas, Barrera, and Ortiz were deposited in a bank account located in the United States (“Bank Account-1”), and then transferred to the Agarwal Bank Account. AGARWAL agreed to accept these funds into the Agarwal Bank Account, and AGARWAL also agreed to accept funds into the Agarwal Bank Account that had been wired to Bank Account-1 from foreign locations, including Mexico.
Upon receiving confirmation that funds collected pursuant to a Money Broker contract issued by Cespedes, Mogollon, Gonzalez, Rojas, Barrera, or Ortiz were available for deposit into the Agarwal Bank Account, AGARWAL arranged for the export of a roughly equivalent value of consumer electronics products to certain consumer electronic product suppliers located in Colombia (the “Colombian Electronics Suppliers”). The Colombian Electronics Suppliers, in turn, arranged to pay for the products by delivering pesos to an individual in Colombia, who then delivered those funds to the Money Brokers. In this way, funds collected in the United States were remitted to Colombia, without requiring that they be reported, declared, or smuggled over international borders.
During the execution of the scheme, federal law enforcement agents working in an undercover capacity, and persons operating at the direction of federal law enforcement agents, informed AGARWAL that the funds he agreed to receive in the Agarwal Bank Account from Bank Account-1, pursuant to the scheme, represented the proceeds of narcotics trafficking activity. AGARWAL, however, continued to accept the funds into the Agarwal Bank Account while facilitating the Money Broker contracts.
AGARWAL, 39, a citizen of India, pled guilty to one count of conspiracy to operate an unlicensed money transmitting business, which carries a maximum sentence of five years in prison. AGARWAL will be sentenced by Judge Engelmayer on July 14, 2021, at 2:30 p.m.
Cespedes is charged in United States v. Miguel Cespedes, 19 Cr. 839, with one count of operation of an unlicensed money transmission business, which carries a maximum sentence of five years in prison, and one count of conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison.
Barrera and Ortiz are charged in United States v. Alex Barrera Forero and David Ortiz Villamizar, 19 Cr. 840, with one count of conspiracy to operate an unlicensed money transmission business, and one count of operation of an unlicensed money transmission business, each of which carries a maximum sentence of five years in prison.
Mogollon, Gonzalez, and Rojas are charged in United States v. Omar Mogollon, et al., 19 Cr. 837, with conspiracy to operate an unlicensed money transmission business and operation of an unlicensed money transmission business, each of which carries a maximum sentence of five years in prison. Mogollon is also charged with one count of international money laundering, which carries a maximum sentence of 20 years in prison.
The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
Ms. Strauss praised the investigative work of the DEA, and thanked authorities in Colombia, and the Justice Department’s Office of International Affairs of the Department’s Criminal Division for their assistance.
This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant United States Attorneys Tara M. La Morte and Cecilia E. Vogel are in charge of the prosecution.
The allegations in the Indictments charging Cespedes, Mogollon, Gonzalez, Rojas, Barrera, and Ortiz are merely accusations, and they are presumed innocent unless and until proven guilty.
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