Money Laundering—“Operation Plata Sucia”

Officials from the U.S. DEA, ICE, FBI, IRS, and local police forces in New York and the Republic of Columbia have released detailed results of a massive transnational investigation that into an alleged Columbian money laundering operation.^[1] According to statements made at a press conference yesterday, law enforcement officials connected with "Operation Plata Sucia" have arrested 26 individuals in 2 countries and have seized over $16.5 million in street drugs and cash so far.^[2]

Of the suspects, 14 were arrested in Columbia, South America (7 in Bogota and 7 in Cali) and 12 were arrested in the United States (2 in Florida and 10 in New York). The suspects, mostly “peso brokers” and intermediaries, have been charged in a series of charging documents filed in the Southern District of New York with money laundering, a violation of 18 U.S.C.§ 1956.^[3] The primary mechanism for moving the money is a currency exchange system referred to as the Black Market Peso Exchange (BMPE), a system we discussed last week and in April 2006.^[4]

The primary asset of the BMPE system is that it involves only verbal communication, leaving no paper trail between goods and proceeds.^[5] This aspect may make prosecuting the alleged crimes fairly difficult and is likely to increase the reliance of prosecutors on cooperation from the suspects.

The alleged scheme is described as involving a multi‑part process that begins after the completion of the drug sale.^[6] First, traffickers in the U.S. sell their cash proceeds to brokers in Columbia for Columbian pesos.^[7] Next, the Columbian peso brokers use associates in the U.S. to collect and deposit the money into U.S. banks.^[8] Finally, the laundered dollars are sold to Columbian business people.^[9] The buyers typically use the money to purchase goods, including truck parts, for import and sale in Columbia.^[10]

If convicted of violating 18 U.S.C. § 1956, the suspects could face penalties of imprisonment for up to twenty years and fines of up to $500,000 or twice the value of the property involved in the transaction, whichever is greater.^[11]

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[1] 26 Arrested in International Drug Bust, DEA Press Release, Oct. 18, 2006.
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] Id.
18 U.S.C. § 1956(a)(1).