LOS ANGELES - Two men and the South El Monte import-export company they used to move millions of dollars linked to illegal activity from the United States to Mexico were sentenced today for operating an unlicensed money transmitting business. The three defendants received large sums of cash - often hidden in duffel bags - and they worked with “peso brokers" in Mexico to illegally convert the dollars to pesos.
The three defendants sentenced today by United States District Judge John A. Kronstadt are:
• Peace & Rich Import, Inc., a wholesale distributor of silk flowers and other goods, which was sentenced to pay a $75,000 fine and to be on probation for four years with stringent conditions;
• Chaur Hwan “Kenny" Lin, 67, of Temple City, the president and co-owner of Peace & Rich, who was sentenced to one year in federal prison and ordered to pay a $6,000 fine; and
• Antonio Pareja, 54, of San Gabriel, the manager of Peace & Rich, who was sentenced to one year and one day in prison.
Judge Kronstadt also ordered Peace & Rich and Lin to forfeit more than $2 million of funds related to the crime.
Lin and Pareja ran Peace & Rich as an informal money transfer system that was involved in the transfer of money outside of the conventional financial institutions system. An investigation by the Drug Enforcement Administration in Los Angeles determined that Lin and Pareja used Peace & Rich to receive large amounts of cash derived from illegal activity. The cash - as much as hundreds of thousands of dollars - was typically delivered by couriers working in conjunction with a peso broker in Mexico.
In a Black Market Peso Exchange scheme, a peso broker works with an individual engaged in illegal activity, such as a drug trafficker, who has United States currency in the United States that he needs to bring to Mexico and convert to pesos. The peso broker finds business owners in Mexico who buy goods from vendors in the United States, such as Peace & Rich, and need dollars to pay for those goods. The peso broker arranges for the illegally obtained dollars in the United States to be delivered to the United States-based vendors, such as Peace & Rich, where they are used to pay for the goods purchased by the Mexico based customers. Once the goods are shipped to Mexico and sold by the Mexico based business owner for pesos, the pesos are turned over to the peso broker, who then pays the drug trafficker in Mexico.
Peace & Rich took in large amounts of cash and conducted transactions without being registered as a money transmitting business and without filing Currency Transaction (CTRs), which are required when a business accepts cash payments of more than $10,000. Lin and Pareja disbursed cash as directed by a peso broker in Mexico to couriers for delivery to other United States based businesses on behalf of their Mexico based customers. Additionally, Lin “structured" cash deposits - or, made a series of deposits that were less than $10,000 - to avoid the filing of CTRs by the financial institutions where the deposits were made.
