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US Busts Extensive Panamanian Money-Laundering Racket

by Mike Godfrey, Tax-News.com, Washington

03 January 2012


The US Department of the Treasury's Office of Foreign Assets Control has announced a major crackdown on an extensive money laundering network based primarily in Panama, which includes several money exchange businesses based in the nation.

In its latest announcement, the Office of Foreign Assets Control (OFAC) has designated Lebanese-Colombian nationals Jorge Fadlallah Cheaitelly and Mohamad Zouheir El Khansa Specially Designated Narcotics Traffickers “due to their significant role in international money laundering activities involving drug trafficking proceeds”.

OFAC also designated nine other individuals and 28 entities in Colombia, Panama, Lebanon, and Hong Kong with ties to Cheaitelly and El Khansa.

The Department of the Treasury said the action - taken pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act) - prohibits US persons from conducting financial or commercial transactions with these entities and individuals and freezes any assets the designees may have under US jurisdiction.

“Jorge Fadlallah Cheaitelly runs an extensive money laundering network based in Panama and Colombia with ties to Mexico, Lebanon, and Hong Kong,” said OFAC Director Adam J. Szubin. “By designating these individuals and companies we are exposing a significant international money laundering network, forcing them out of the international financial system, and undermining their ability to launder drug money through a global support network for the Mexican and Colombian drug cartels.”

“These criminals and their entities operate in the shadows, using sophisticated means and various business fronts to launder drug trafficking proceeds worldwide,” said DEA Administrator Michele M. Leonhart.

The US government reported that Cheaitelly leads a Panama-based drug trafficking and money laundering organization that stretches across the globe, spanning the Americas, the Middle East, and Hong Kong. OFAC's action targets 28 companies controlled by Jorge Cheaitelly and Mohamad El Khansa and their associates in Panama, Colombia and Hong Kong.

Among OFAC's designations are several money exchange businesses in Panama -- Eurocambio, S.A., Euro Exchange Y Financial Commerce, Inc. (a.k.a. Eurex) and General Commerce Overseas, Inc. ­- as well as Junior International S.A., Global Technology Import & Export, S.A. (GTI), and Fedco Import & Export, S.A., import/export businesses located in Panama’s Colon Free Zone.

Two businesses controlled by Cali-based money launderer Jaime Edery Crivosei - Agropecuaria La Perla Ltda and KPD S.A. - were also designated.

OFAC also designated Polyton (Asia) Limited, a company located in Hong Kong, for acting for or on behalf of Guiseppe Ali Cheaitelly Saheli.

As part of its work, the Treasury Department has designated more than 1,000 individuals and entities linked to drug kingpins under the Kingpin Act since June 2000. Penalties for violations of the Kingpin Act range from civil penalties of up to USD1.075m per violation to more severe criminal penalties.

Criminal penalties for corporate officers may include up to 30 years' imprisonment and fines up to USD5m. Criminal fines for corporations may reach USD10m. Other individuals face up to 10 years in prison and fines pursuant to Title 18 of the United States Code for criminal violations of the Kingpin Act.

TAGS: individuals | money-laundering | compliance | business | offshore confidentiality | mining | law | banking | international financial centres (IFC) | Colombia | Mexico | enforcement | offshore | offshore banking | banking secrecy | Hong Kong | United States | penalties | Lebanon | Panama | corporate responsibility

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