DEA Seizes $5.6M From Launderers Using City Banks
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The Drug Enforcement Administration has seized more than $5.6 million from money launderers in Dubai who were using New York City banks to disguise cash made from illicit enterprises in Europe, officials said.
At the center of the probe was Naresh Jain Kumar Patel, who ran the operation in the United Arab Emirates, according to an affidavit filed in district court of the Southern District of New York. He was arrested along with 39 others in February.
Mr. Patel and his associates would make transfers into at least 15 banks from Man Financial, a bank in the city. He would then begin “layering ” the money, a process used to make it more difficult to trace funds obtained on the black market. For instance, Mr. Patel would direct the bank to buy commodities that he already controlled. On the surface, the accounts were drawing a loss, but the money was actually shifting from one hand to the other, officials said.
“This is indicative of what we are trying to do more of,” the director of the New York field office of the DEA, John Gilbride, said. The agency is increasingly working with banking associations and financial institutions to deny revenue to drug dealers, he said.
In fiscal 2006, the agency seized $67.5 million in cash, monetary assets, real estate, and other valuables from drug smuggling groups, he said.
The authorities first found out about the operation when Italian police learned that an Albanian drug trafficking group was using Mr. Patel to launder its money. Law enforcement officers from Britain, Italy, the United Arab Emirates, and New York investigated parts of the case, officials said.
The Albanian group would use informal networks of money transferring business called “hawalas” to get the money to the United Arab Emirates, according to the affidavit.