Former Owner of Chilean Financial Services Company Sentenced in Manhattan Federal Court for Violating U.S. Anti-Money Laundering Law
SEPT 10 -- JOHN P. GILBRIDE, Special Agent-in-Charge of the Drug Enforcement Administration’s New York Field Division (“DEA”) and PREET BHARARA, the United States Attorney for the Southern District of New York, announced that MAURICIO ALFONSO MAZZA-ALALUF, the former owner of the Chilean financial services company Turismo Costa Brava S.A., was sentenced today in Manhattan federal court by United States District Judge P. KEVIN CASTEL to 42 months in prison and ordered to forfeit $10 million. Judge CASTEL, in a written Opinion issued in January 2009, found MAZZA-ALALUF guilty of violating a federal anti-money laundering statute prohibiting unlicensed money transmitting -- following a November 2008 bench trial.
According to the evidence at trial and documents filed in this case, including the Indictment charging MAZZA-ALALUF and Judge CASTEL's Opinion:
MAZZA-ALALUF was one of the owners of Chilean financial services company Turismo Costa Brava, S.A. ("Turismo"), which provided fund transfer and currency exchange services for its customers. As a means of ensuring effective regulation of money transfer businesses, which are frequently used to launder illicit funds, United States law requires money transmitting businesses operating in the United States to comply with federal regulations of the United States Treasury, and to obtain a license from every state in which they operate that has a licensing requirement. New York, Illinois, and Michigan all require money transmitting businesses to obtain a license, but Turismo did not acquire one from any of those states. Turismo's owners and employees physically carried bulk cash, often in Euros or other European currencies, into the United States on flights from South America to Los Angeles.
Turismo's couriers openly declared the cash as they passed through U.S. Customs, then handed it over to an armored car service that delivered it to a Los Angeles currency exchange business. The business then transmitted the dollar equivalent of the foreign currency to accounts Turismo maintained at banks in New York, Chicago, and Dearborn, Michigan -- which Turismo then used to facilitate thousands of wire transfers totaling hundreds of millions of dollars to accounts all over the world. MAZZA-ALALUF was arrested in March 2007 when he arrived at Los Angeles International Airport with over $1.9 million in foreign currencies that were part of his money transmitting business.
MAZZA-ALALUF was tried on an Indictment charging him with one count of conspiring to conduct an unlicensed money transmitting business and one count of conducting an unlicensed money-transmitting business. Judge CASTEL found MAZZA-ALALUF guilty on both counts based on Turismo's use of bank accounts in New York, Illinois, and Michigan without the required state licenses. The defendant had waived his right to a jury trial.
The investigation of MAZZA-ALALUF and Turismo was conducted by agents of the Internal Revenue Service ("IRS") and the United States Drug Enforcement Administration ("DEA"), working together as part of the New York Organized Crime Drug Enforcement Strike Force, which is comprised of agents and officers of the DEA, the New York City Police Department, the IRS Criminal Investigation Division, the Department of Homeland Security Bureau of Immigration and Customs Enforcement, the Federal Bureau of Investigation, and the New York State Police. The Strike Force is partially funded by the New York/New Jersey High Intensity Drug Trafficking Area (HIDTA), which is a federally funded crime fighting initiative. Mr. BHARARA thanked the DEA and IRS for their work in conducting the complex, international financial investigation.
Assistant United States Attorneys SARAH LAI and MARK LANPHER are in charge of the prosecution, which was conducted out of the Office's International Narcotics Trafficking Unit.