One of the leaders of an organization that laundered more than $20 million through “shell” business bank accounts pleaded guilty today in federal court in Houston, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Enrique Morales, 42, of Houston and Guadalajara, Mexico, pleaded guilty today before U.S. District Judge Lee H. Rosenthal in the Southern District of Texas to conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business.
In August 2012, a federal grand jury in Houston indicted Morales and four of his co-defendants for their roles in operating a money transmitting business that provided professional money laundering services to narcotics traffickers as part of a scheme commonly referred to as “the Black Market Peso Exchange.” According to the indictment, from October 2009 to September 2011, the defendants placed U.S. currency obtained through the sale of drugs in the U.S. into bank accounts held in the name of shell companies, which were owned and operated by the defendants. The money was then transferred to different accounts in the U.S. and Mexico. In exchange, pesos were transferred to bank accounts owned by the defendants’ clients.
A total of five people arrested as part of this scheme have now been convicted. Willie Whitehurst, Fulton Smith and Anthony Foster, all from Houston and money couriers for the organization, previously pleaded guilty to conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business. Smith, 40, pleaded guilty yesterday, while Whitehurst, 44, and Foster, 47, pleaded guilty in January 2013. An office manager for the organization, Sarah Combs, 48, of Dickinson, Texas, previously pleaded guilty to conspiracy to operate an unlicensed money transmitting business.
Foster, Whitehurst and Combs are scheduled for sentencing on May 9, 2013, while the sentencings of Smith and Morales are set for May 29, 2013. For the money laundering conspiracy, Morales, Whitehurst, Foster and Smith face up to 20 years in federal prison and a $500,000 fine, or twice the value of the property involved in the offense, whichever is greater. All five defendants face up to five years in federal prison and a fine of $250,000 for conspiracy to operate an unlicensed money transmitting business.
The case was investigated by the special agents with the Drug Enforcement Administration and Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorney Ted Imperato of the Southern District of Texas and Keith Liddle, trial attorney in the Money Laundering and Bank Integrity Unit of the Criminal Division’s Asset Forfeiture and Money Laundering Section.
The Money Laundering and Bank Integrity Unit investigates and prosecutes complex, multi-district and international criminal cases involving financial institutions and individuals who violate the money laundering statutes, the Bank Secrecy Act and other related statutes. The unit’s prosecutions generally focus on three types of violators: financial institutions, including their officers, managers and employees, whose actions threaten the integrity of the individual institution or the wider financial system; professional money launderers and gatekeepers who provide their services to serious criminal organizations; and individuals and entities engaged in using the latest and most sophisticated money laundering techniques and tools.