From Fashion Textiles to Money Laundering
The owners of Los Angeles-based import and export textiles company, Pacific Eurotex, were sentenced to federal prison time and hefty liabilities on December 18, 2018 for their involvement with laundering money related to international drug cartels, according to a release from U.S. Immigration and Customs Enforcement.
Formally known as the “Black Market Peso Exchange” scheme, it’s known as one of the primary strategies drug cartels use to gather proceeds resulting from illicit drugs in the United States. The strategy mechanism enables drug traffickers to eventually convert proceeds into another form of currency through internationally shipped goods.
Brothers Morad and Hersel Neman (CEO and CFO) pleaded guilty to filing false tax returns in addition to other IRS and defrauding-related crimes. Both were sentenced to more than a year in federal prison with six months of home confinement thereafter. Additionally, Morad “Ben” Neman is jointly liable with the company to forfeit $3,178,230 million to the government while CFO Hersel Neman is liable for approximately $370,000. The company faces three years of probation and a $400,000 fine.
According to court documents the textiles company, “Received, laundered and structured approximately $370,000 in bulk cash delivered on four separate occasions over 2½ months in 2013 by an undercover agent posing as a money courier.”
The arrests originally occurred in 2014 after a Fashion District investigation using the “Black Market Peso Exchange” tactic resulted in law enforcement seizing over $100 million in laundered drug money.