Unveiling the Spectrum of Crimes Perpetrated by Organized Crime Syndicates

Organized crime has long been a menacing force that thrives on illegal activities, power structures, and financial gain. These criminal enterprises operate with a high level of sophistication and coordination, engaging in a wide range of illicit activities that pose a significant threat to society. This article aims to shed light on the types of crimes commonly committed by members of organized crime, revealing the depth and diversity of their illegal endeavors.

Drug Trafficking:

One of the primary revenue streams for organized crime is drug trafficking. These criminal networks play a major role in the production, transportation, and distribution of illegal drugs, such as cocaine, heroin, methamphetamine, and synthetic drugs. They exploit the global demand for narcotics, infiltrating legitimate businesses and employing complex networks to smuggle and distribute drugs across borders.

Money Laundering:

Organized crime syndicates generate enormous profits from their illicit activities, and they employ various methods to launder their ill-gotten gains. Money laundering involves disguising the illegal origins of funds through a series of transactions or activities, making it appear as legitimate income. This allows criminals to integrate their illicit funds into the legal economy, obscuring the money trail and facilitating further criminal activities.

Extortion and Protection Rackets:

Extortion is a common tactic employed by organized crime groups to generate income and maintain control. They target individuals, businesses, and even public officials, demanding protection payments in exchange for avoiding harm or securing business operations. These criminal syndicates use violence, intimidation, and the threat of harm to compel victims to comply with their demands, instilling fear and exerting control over specific territories.

Human Trafficking:

Organized crime is heavily involved in the lucrative and despicable crime of human trafficking. These criminal networks exploit vulnerable individuals, subjecting them to forced labor, sexual exploitation, or other forms of modern-day slavery. They profit from the trafficking of men, women, and children across international borders, often through deception, coercion, and violence.

Cybercrime:

As technology continues to advance, so does the involvement of organized crime in cybercrime. These criminal networks employ skilled hackers, programmers, and fraudsters to orchestrate various cyber-enabled crimes. These may include identity theft, financial fraud, ransomware attacks, hacking into corporate systems, and trafficking stolen personal and financial information on the dark web.

Counterfeiting and Intellectual Property Theft:

Organized crime syndicates engage in counterfeiting, producing counterfeit currency, luxury goods, and pharmaceuticals. They also play a significant role in intellectual property theft, pirating copyrighted material, such as movies, music, software, and designer products. This illicit trade undermines legitimate businesses, damages economies, and poses significant risks to consumer safety.

Arms Trafficking:

Organized crime groups are involved in arms trafficking, supplying weapons to various criminal networks, terrorists, and insurgent groups. They exploit global arms markets, utilizing smuggling routes to traffic firearms, explosives, and military-grade equipment. This illicit trade fuels violence, contributes to armed conflicts, and poses a threat to national security.

Conclusion:

The spectrum of crimes committed by members of organized crime is vast and far-reaching. From drug trafficking and money laundering to human trafficking and cybercrime, these criminal syndicates exploit various avenues to amass wealth and power. Understanding the types of crimes perpetrated by organized crime is crucial for law enforcement agencies, policymakers, and society at large to effectively combat these criminal enterprises. By targeting their illicit activities, disrupting their financial networks, and promoting international cooperation, we can strive towards dismantling these criminal organizations and creating safer communities for all.

Individual Convicted of Conspiracy and Money Laundering for Role in Costa Rican Telemarketing Scheme

An Ohio man was convicted yesterday after a two-day jury trial in the Western District of North Carolina for his role in a Costa Rican telemarketing scheme.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina made the announcement.

Paul Ronald Toth Jr., 40, of Wintersville, Ohio, was convicted of one count of conspiracy to commit money laundering and six counts of international money-laundering concealment.  Sentencing before U.S. District Judge Robert J. Conrad Jr. of the Western District of North Carolina will be scheduled at a later date.

According to the evidence presented at trial, Toth was involved in a telemarketing scheme in which his co-conspirators contacted U.S. residents from call centers in Costa Rica, falsely informing them that they had won substantial cash prizes in “sweepstakes.”  To claim the cash prizes, the victims – many of whom were elderly – were instructed to send a purported “refundable insurance fee.” 

The trial evidence showed that, between approximately November 2009 and November 2010, Toth was a United States-based “smasher” who facilitated the laundering of funds received from the elderly victims.  Specifically, according to the evidence presented at trial, Toth and others he recruited and supervised received over $300,000 from victims and, using various individuals as senders and recipients to conceal the fraudulent nature of the transactions, wired over $200,000 of those funds to co-conspirators in Costa Rica.  The evidence further demonstrated that Toth kept the remainder as his profit.

This case is being investigated by the U.S. Postal Inspection Service, the FBI, the Internal Revenue Service, Federal Trade Commission and Department of Homeland Security.  The case is being prosecuted by Senior Litigation Counsel Patrick Donley and Trial Attorneys William Bowne and Anna Kaminska of the Criminal Division’s Fraud Section.

Leader of Poly-Drug Trafficking and International Money Laundering Ring Sentenced to 210 Months in Prison

ANCHORAGE—U.S. Attorney Karen L. Loeffler announced that on September 14, 2012, Daniel Isaac Meza, 37, was sentenced to 210 months in prison for his leading role in a conspiracy to distribute more than five kilograms of cocaine, one kilogram of heroin, more than 50 grams of actual methamphetamine, and a quantity of oxycodone. U.S. District Court Judge Timothy M. Burgess imposed the sentence, which also included a $13,500 fine.

In his prior guilty plea, Meza admitted to supplying illegal drugs to multiple members of the trafficking organization, who then redistributed to lower-level dealers and drug users. Meza was the last of 11 charged defendants to be convicted of involvement in the expansive drug trafficking network, whose members were responsible for trafficking large amounts of illegal narcotics in Alaska and laundering the proceeds by wire transfer to El Salvador, Mexico, and Colombia. Eight defendants have now been indicted and convicted of direct participation in Meza’s conspiracy, which was charged along with a related conspiracy involving Patrick Sherman, a former corrections officer at Anchorage Correctional Complex. Sherman was convicted in November 2010, of cooperating with co-conspirator Brandi Barnes to distribute marijuana, cocaine, and heroin, along with syringes, in Anchorage Correctional Complex. Barnes pled guilty to her role in both related conspiracies on March 2, 2012. Two defendants—James McAnulty and Robyn Ray—were not directly charged in the conspiracy but have been convicted, respectively, of distributing cocaine on behalf of conspiracy member Billy Fuller and laundering more than $40,000 in drug proceeds for Meza. Edwin Giovanni Enriquez, Billy Walter Fuller, Michael George Raab, Debbie Beisinaiz, and Cori Jean Hillar, were also convicted for their roles in the conspiracy.

Additionally, Meza pled guilty to one count of international money laundering relating to drug trafficking. The indictment alleged that he sent drug proceeds to Mexico, Colombia, and El Salvador on 21 occasions. At this point, all of the defendants have been sentenced for their roles in the conspiracy.

According to information presented to the court at sentencing, Meza imported cocaine, heroin, methamphetamine, and oxycontin into Alaska, where these substances were distributed by a network of associates that included all of the other conspirators. Court documents alleged that Meza used hollowed-out Coleman coolers to smuggle narcotics into Alaska, and then transported money out of Alaska by wire transfer or by physical transportation of bulk currency concealed in electronic equipment. Court documents alleged that over 100 grams of heroin were found in Meza’s freezer in July of 2010, and that this heroin was only part of more than a kilogram of heroin that Meza distributed at an earlier time. Law enforcement exposed Meza’s organization by utilizing several court ordered telephone wiretaps.

In imposing sentence, Judge Burgess noted the seriousness and breadth of the crime, finding that Meza was an organizer and leader of the conspiracy, and found that Meza committed the offense as part of a pattern of criminal conduct engaged in as a livelihood.

The case was the result of an investigation conducted by the Drug Enforcement Administration, Anchorage District Office, and the Alaska State Troopers Mat-Su Narcotics Unit; the investigation was supported by numerous agencies, including the Federal Bureau of Investigation, Anchorage Police Department, Internal Revenue Service-Criminal Investigation, Homeland Security Investigations, Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Anchorage Airport Police.

Eduardo Arellano-Felix Extradited from Mexico to the United States to Face Charges

Key Advisor to the Arellano-Felix Organization’s Leadership

WASHINGTON—Eduardo Arellano-Felix, 55, one of the alleged members of the Arellano-Felix Organization (AFO), was extradited today by the government of Mexico to the United States to face racketeering, money laundering, and narcotics trafficking charges in the Southern District of California.

The extradition was announced by U.S. Attorney for the Southern District of California Laura E. Duffy and Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. Arellano-Felix was arrested by Mexican authorities in Tijuana, Baja California, Mexico, on October 25, 2008, following a gun battle with a Mexican Special Tactical Team. A final order of extradition to the United States was granted in 2010. After two years of unsuccessful appeals, Arellano-Felix arrived in the United States this afternoon. He is scheduled to make his initial appearance on Tuesday, September 4, 2012, in U.S. District Court in San Diego before U.S. Magistrate Judge Barbara Lynn Major.

U.S. Attorney Duffy, whose office secured the indictment against Arellano-Felix, said, “This extradition is a significant step in our effort to bring another key figure in the Arellano-Felix Organization to answer, in an American court of law, to very serious charges. We are grateful to the government of Mexico for its assistance in the extradition.”

“Today’s extradition is a milestone in our fight against the Mexican drug cartels. I want to thank the Criminal Division’s Office of International Affairs for its tireless work in helping to ensure that Eduardo Arellano-Felix and numerous of his alleged co-conspirators face justice in the United States,” said Assistant Attorney General Breuer.

“The extradition of Eduardo Arellano-Felix today marks the end of a 20-year DEA investigation into this vicious drug cartel,” said William R . Sherman, Acting Special Agent in Charge of the San Diego Drug Enforcement Administration (DEA). “This extradition illustrates that DEA and all its law enforcement partners will relentlessly pursue these drug traffickers until they are brought to justice.”

San Diego FBI Special Agent in Charge Daphne Hearn said, “The FBI is pleased with Mexico’s efforts to bring to justice a leader from one of the most violent criminal enterprises in our history. The spirit of cooperation between our two countries is a powerful force in disrupting the criminal activities of these groups that instill fear and threaten the safety of our citizens in the border regions of the United States.”

Long-reputed to be one of the most notorious multi-national drug trafficking organizations, the AFO controlled the flow of cocaine, marijuana, and other drugs through the Mexican border cities of Tijuana and Mexicali into the United States. Its operations also extended into southern Mexico as well as Colombia.

The seventh superseding indictment charges Arellano-Felix with conducting the affairs of an illegal enterprise through a pattern of racketeering activity (RICO), conspiracy to import and distribute cocaine and marijuana, as well as money laundering. The indictment alleges that the leadership of the AFO negotiated directly with Colombian cocaine-trafficking organizations for the purchase of multi-ton shipments of cocaine, received those shipments by sea and by air, in Mexico, and then arranged for the smuggling of the cocaine into the United States and its further distribution throughout the U.S. The indictment also alleges that the proceeds of the AFO’s drug trafficking, estimated by law enforcement to be in the hundreds of millions of dollars, were then smuggled back into Mexico.

Brothers and former leaders of the AFO, Benjamin Arellano-Felix and Francisco Javier Arellano‑Felix, are currently serving sentences in the United States following their convictions for racketeering, drug trafficking, and money laundering charges.

This case is being investigated by agents from the DEA, the FBI, and the Internal Revenue Service-Criminal Investigation and prosecuted in the Southern District of California by Assistant U.S. Attorneys Joseph Green, James Melendres and Dan Zipp. The Criminal Division’s Office of International Affairs provided significant assistance in the extradition. The investigation of Arellano-Felix was coordinated by an Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program was created to consolidate and coordinate all law enforcement resources in this country’s battle against major drug trafficking rings, drug kingpins, and money launderers.

The public is reminded that an indictment is not evidence that the defendant committed the crimes charged. The defendant is presumed innocent until the government meets its burden in court of proving guilt beyond a reasonable doubt.

Bank Fraud Defendants Sentenced to 60 and 70 Months

Defendants Fraudulently Obtained $19.67 Million from Washington Mutual

SAN FRANCISCO—Michael Ohayon and David Papera were sentenced yesterday to 60 and 70 months in prison, respectively, and ordered to pay more than $10.5 million in restitution for conspiracy to commit bank fraud and money laundering, United States Attorney Melinda Haag announced.

Ohayon pleaded guilty to conspiracy to commit bank fraud, bank fraud, and money laundering on May 24, 2010. Papera pleaded guilty to conspiracy to commit bank fraud and money laundering on April 19, 2012.

Ohayon and Papera formed a company called Sage Creek Ranch LLC for the purpose of developing multiple parcels of property in California’s Napa County. According to the plea agreements, they admitted to obtaining millions in loans from Washington Mutual Bank by submitting fraudulent loan applications in the names of “straw buyers”—i.e., individuals with good credit scores who would each obtain a residential loan to purchase a parcel from Sage Creek Ranch LLC, but who would in reality make neither down payments nor mortgage payments on the property. Ohayon and Papera admitted that they knew that the straw buyers’ loan applications included materially false information about the buyers’ income. They further admitted that they used more than $1.25 million of the loan proceeds to pay down one of Papera’s loans on a separately owned property.

Ohayon, 44, of San Francisco, and Papera, 50, of San Rafael, California, were indicted by a federal grand jury on February 11, 2010. They were charged with conspiracy to commit bank fraud, bank fraud, and money laundering.

In addition to Ohayon and Papera, six of the straw buyers were charged with and pleaded guilty to tax felonies for failure to report as income approximately $50,000 they each received from Ohayon and Papera for allowing their names and credit to be used in the bank fraud scheme.

The sentence was handed down by U.S. District Court Judge Charles R. Breyer following Ohayon’s guilty plea to conspiracy to commit bank fraud, in violation of 18 U.S.C. § 1349; bank fraud, in violation of § 1344; and money laundering, in violation of 18 U.S.C. § 1957; and Papera’s guilty plea to conspiracy to commit bank fraud, in violation of 18 U.S.C. § 1349; and money laundering, in violation of 18 U.S.C. § 1957. Judge Breyer also sentenced the Defendants to a five-year period of supervised release and ordered them to make restitution to Chase Home Finance (Washington Mutual’s successor) in the amount of $10,586,079.73. Ohayon is scheduled to begin serving his sentence on January 4, 2013. Papera is scheduled to begin serving his sentence on November 2, 2012.

Tracie L. Brown and Denise M. Barton are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Rayneisha Booth, Elizabeth Garcia, and Maryam Beros. The prosecution is the result of a lengthy investigation by Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation.