Tag Archives: Money Laundering

U.S. charges Ukrainian, Russian, over cyberattack, seizes $6 million in ransom payments

By Mark Hosenball and Kanishka Singh

(Reuters) -The U.S. Justice Department has charged a suspect from Ukraine and a Russian national over a July ransomware attack on an American company, according to indictments made in court filings on Monday, with CNN reporting the United States has seized $6 million in ransom payments.

Yaroslav Vasinskyi, a Ukrainian national arrested in Poland last month, will face U.S. charges for deploying ransomware known as REvil, which has been used in hacks that have cost U.S. firms millions of dollars, the court filing showed.

Vasinskyi conducted a ransomware attack over the July 4 weekend on Florida-based software firm Kaseya that infected up to 1,500 businesses around the world, according to the charges filed in the U.S. District Court for the Northern District of Texas.

Vasinskyi and another alleged REvil operative, Russian national Yevgeniy Polyanin, were charged by the United States with conspiracy to commit fraud and conspiracy to commit money laundering, among other charges.

The Treasury Department also said the two operatives face sanctions for their role in ransomware incidents in the United States, as well as a virtual currency exchange called Chatex “for facilitating financial transactions for ransomware actors.”

The Treasury said the two individuals received more than $200 million in ransom payments paid in Bitcoin and Monero. It added that Latvian and Estonian government agencies were vital to the investigation.

Vasinskyi, 22, was being held in Poland pending U.S. extradition proceedings, while Polyanin, 28, remained at large.

The U.S. indictment of the Ukrainian hacker said he and other conspirators started deploying hacking software around April 2019 and “regularly” updated and refined it. The indictment also accused the hacker of laundering money obtained through a hacking extortion scheme.

Europol said earlier on Monday that Romanian authorities on Nov. 4 arrested two individuals suspected of cyber-attacks deploying the REvil ransomware. Since February, law enforcement authorities have arrested three other affiliates of REvil, Europol added.

Twelve suspects believed to have mounted ransomware attacks against companies or infrastructure in 71 countries were “targeted” in raids in Ukraine and Switzerland, Europol said on Friday.

(Reporting by Mark Hosenball in Washington and Kanishka Singh in Bengaluru; Editing by Dan Grebler)

Honduran president target of U.S. investigation, court filings show

By Laura Gottesdiener

(Reuters) – U.S. prosecutors are investigating Honduran President Juan Orlando Hernandez, according to a new court filing, piling pressure on a leader who prosecutors have already accused of participation in the nation’s bloody narcotics trade.

In a document filed Friday night in the Southern District of New York in the case of Geovanny Fuentes Ramirez, an alleged Honduran drug-trafficker, federal prosecutors said Hernandez himself was the target of an investigation, along with other “high-ranking officials.”

They did not say what the investigation concerned. But in the filing they accused Hernandez, who has been president since 2014, of using Honduran law enforcement and military officials to protect drug traffickers as part of a plan “to use drug trafficking to help assert power and control in Honduras.”

Last month, U.S. prosecutors said in a court filing related to the same case that Hernandez had by 2013 “accepted millions of dollars in drug-trafficking proceeds and, in exchange, promised drug traffickers protection from prosecutors, law enforcement, and (later) extradition to the United States.”

The prosecutors said that assistance from the Honduran government in its investigations “has hardly been forthcoming,” accusing the Honduran government of providing “limited records” and not honoring extradition requests for potential witnesses against the president.

The Honduran government did not respond to requests for comment. Hernandez has repeatedly denied any ties to drug cartels.

The Honduran president has been a key U.S. ally in the region and the investigation could complicate the Biden administration’s efforts to invest $4 billion in Central America, including Honduras, to address the causes of migration.

Last month, thousands of Hondurans joined one of the largest-ever migrant caravans hoping to reach the United States, with many citing rampant violence, government corruption, and worsening poverty as their reasons for leaving the country.

Dana Frank, an expert on Honduras and professor at the University of California, Santa Cruz, said the revelations raised difficult questions for the new U.S. government of President Joe Biden.

“Will the Biden administration, despite this further evidence, continue to shore up and fund Hernandez, including his corrupt police and military that protect drug shipments at his beck and call?” she said.

References to Hernandez, who is referred to as CC-4, have frequently appeared in the U.S. court filings against Fuentes Ramirez, as well as in a successful drug-trafficking case against the president’s brother, Tony Hernandez.

Previous court filings also show that, around 2013, the U.S. Drug Enforcement Administration began investigating Hernandez and others for drug trafficking and money laundering.

Friday’s filing appeared to be the first confirmation from U.S. prosecutors that the Honduran president was currently under investigation by the United States.

(Reporting by Laura Gottesdiener; Editing by Dave Graham and Rosalba O’Brien)

U.S. Republican senators ask Treasury for suspicious activity reports on Hunter Biden

By Richard Cowan and Valerie Volcovici

WASHINGTON (Reuters) – The Republican chairmen of two U.S. Senate committees have asked the Treasury Department to provide any reports of money laundering or fraud related to former Vice President Joe Biden’s son’s business dealings with a Ukraine energy firm, according to a letter seen by Reuters on Friday.

The letter seeks “suspicious activity reports,” which are documents that financial institutions file with the Treasury Department’s Financial Crimes Enforcement Network whenever there is a suspected case of money laundering or fraud. It was unclear whether any such reports exist related to Hunter Biden, the former vice president’s son.

The request comes as Republicans seek to defend President Donald Trump against a Democrat-led impeachment probe into whether the president improperly pressured Ukraine to investigate the Bidens to improve his reelection chances.

Senate Finance Committee Chairman Chuck Grassley and Homeland Security and Governmental Affairs Committee Chairman Ron Johnson sent the request in a letter dated Nov. 15 to Treasury Department Director of Financial Crimes Enforcement Network Ken Blanco.

The chairmen said they want information by Dec. 5 related to Hunter Biden, who was on the board of directors of Burisma Holdings, which had been under investigation in Ukraine.

In their letter the senators noted Burisma was paying Hunter Biden as much as $50,000 a month and that their panels are investigating “potentially improper actions by the Obama administration with respect to Burisma Holdings and Ukraine.”

Grassley and Johnson, citing a story by a reporter with conservative ties, said Burisma’s consulting firm Blue Star Strategies used Biden’s board membership to gain access to Obama administration officials at the State Department.

The Bidens have denied any wrongdoing.

The elder Biden is a leading Democratic candidate for president in next year’s U.S. elections in which Trump is seeking a second four-year term.

Grassley and Johnson also said on Friday that they have asked the U.S. National Archives and Records Administration for records of 2016 White House meetings between Obama administration officials, Ukrainian government representatives and officials of the Democratic National Committee.

Trump and Republicans in Congress have been ramping up their rhetoric on the Bidens as the November 2020 U.S. elections near and as Democrats in the House of Representatives intensify their impeachment investigation of Trump.

Democrats are looking into whether Trump used the withholding of U.S. aid to Ukraine as leverage to press Kiev to launch investigations into the Bidens and allegations Ukraine meddled in the 2016 U.S. elections to hurt the Trump campaign. U.S. intelligence agencies have concluded it was Russia that tried to influence the 2016 election in favor of Trump.

On Thursday, Senate Judiciary Committee Chairman Lindsey Graham, an ally of Trump’s, wrote to Secretary of State Mike Pompeo requesting documents related to 2016 contacts between the Bidens, other Obama administration officials and former Ukrainian President Petro Poroshenko.

Trump has denied doing anything improper in Ukraine and has called the impeachment inquiry a witch hunt.

(Reporting by Valerie Volcovici and Richard Cowan; editing by Richard Valdmanis and Cynthia Osterman)

Dutch psychologists helping probe over family found locked away in room

Dutch psychologists helping probe over family found locked away in room
AMSTERDAM (Reuters) – Dutch police called in psychologists to help them get to the bottom of what happened to a family found locked away in a farmhouse room where they appeared to have lived in seclusion for years.

Police discovered six people, who claimed to be five siblings and their ailing father, at the farm in the north of the Netherlands on Monday after a tip from a man believed to be a brother who said he had escaped.

Police detained the 67-year-old man believed to be the father of the family on Thursday on charges of unlawful detention, a form of abuse and money laundering. The last charge related to a cache of cash discovered at the farm.

On Tuesday, a 58-year-old man who paid the rent on the farmhouse was taken into custody on similar charges.

“We have called in specialized help,” police spokesman Anthony Hogeveen said on Friday, adding that more than four days after the discovery of the family, investigators were still in the dark about how the family ended up in the room.

“This is an extraordinary situation. With a team of psychologists we are trying to understand what we see,” police chief Janny Knol said in a Dutch television interview.

Police said the children were never registered at birth and had never gone to school, both of which are required by law in the Netherlands. “Basically we know nothing of them,” Knol said.

The six people found in the locked room have been moved to accommodation in a holiday park.

(Reporting by Bart Meijer; Editing by Mark Heinrich)

New York woman charged with laundering money to help Islamic State

By Brendan Pierson

(Reuters) – U.S. prosecutors said Thursday that they had charged a Long Island, New York woman with laundering more than $85,000 in fraudulently obtained money through Bitcoin to help Islamic State.

Zoobia Shahnaz, 27, was arrested Wednesday on charges of bank fraud, conspiracy and money laundering, the office of Acting U.S. Attorney Bridget Rohde in Brooklyn announced. Shahnaz pleaded not guilty on Thursday before U.S. Magistrate Judge Kathleen Tomlinson in Central Islip, New York, according to John Marzulli, a spokesman for Rohde’s office.

A lawyer for Shahnaz, Steve Zissou, could not immediately be reached for comment.

Prosecutors said that between March and July of this year, Shahnaz obtained a loan and multiple credit cards by making false representations to financial institutions, and used them to buy Bitcoin.

They said she then laundered the money through illicit transactions involving shell companies in Pakistan, China and Turkey with the ultimate goal of using the money to benefit Islamic State.

In July, prosecutors said, Shahnaz sought to travel to Syria, but was stopped and questioned by law enforcement at John F. Kennedy International Airport when she tried to board a flight to Islamabad, Pakistan.

The most serious charge, bank fraud, carries 30 years in prison, according to Rohde’s office.

(Reporting By Brendan Pierson in New York; Editing by David Gregorio)

Turkish gold trader implicates Erdogan in Iran money laundering

Turkish gold trader implicates Erdogan in Iran money laundering

By Brendan Pierson

(Reuters) – A Turkish-Iranian gold trader on Thursday told jurors in a New York federal court that Turkish President Recep Tayyip Erdogan personally authorized a transaction in a scheme to help Iran evade U.S. sanctions.

Reza Zarrab is cooperating with U.S. prosecutors in the criminal trial of a Turkish bank executive accused of helping to launder money for Iran. At the time of the alleged conspiracy, Erdogan was Turkey’s prime minister.

Zarrab also said for the first time on Thursday that Turkey’s Ziraat Bank and VakifBank were involved in the scheme. The two banks could not immediately be reached for comment after business hours in Turkey.

The testimony came on the third day of the trial of Mehmet Hakan Atilla, an executive at Turkey’s state-owned Halkbank, who has pleaded not guilty in Manhattan federal court.

U.S. prosecutors have charged nine people in the case, although only Zarrab, 34, and Atilla, 47, have been arrested by U.S. authorities. Prosecutors have said the defendants took part in a scheme from 2010 to 2015 that involved gold trades and fake purchases of food to give Iran access to international markets, violating U.S. sanctions.

The case has fueled tensions between the United States and Turkey, which are NATO allies. Erdogan’s government has said the case was fabricated for political reasons.

Zarrab, who began testifying on Wednesday morning, has told jurors that he ran an international money laundering scheme to help Iran get around U.S. sanctions and spend its oil and gas revenues abroad. He said he helped Iran use funds deposited at Halkbank to buy gold, which was smuggled to Dubai and sold for cash.

Zarrab has said that Atilla helped design the transactions, along with Halkbank’s former general manager, Suleyman Aslan.

Zarrab said that he paid bribes worth more than $50 million to Zafer Caglayan, who was Turkey’s economy minister, to further the scheme. He said he bribed Aslan as well.

Both Caglayan and Aslan were charged in the case. Turkey’s government has previously said that Caglayan acted within Turkish and international law, and Halkbank has said all of its transactions complied with national and international regulations.

Zarrab’s testimony has focused on Halkbank and Turkey, but on Thursday, he said that he had tried to duplicate his scheme in China before Chinese banks shut him down.

“The banks that realized this had something to do with Iran, they immediately stopped it,” he said.

(Reporting By Brendan Pierson in New York; editing by Jonathan Oatis and Dan Grebler)

Man Faces Life For Defrauding Navy Veterans

A man convicted of masterminding a $100 million fraud involving Navy veterans could be spending the rest of his life in prison.

John Donald Cody, 67, is a Harvard-trained attorney who was convicted of racketeering, theft, money laundering and 12 counts of identity theft in connection with his looting of the United States Navy Veterans Association.

Cody defrauded veterans and supporters in 41 states but Ohio took the lead in prosecuting him. He was arrested after spending two years on the run after hiding out in Portland, Oregon. Only a small amount of the $100 million was found.

The Ohio state attorney general’s office, which handled the prosecution, is asking the judge to sentence Cody to 41 years in prison and a fine of $6.3 million.

Cody’s defense team is calling for a new trial saying that their legal defense was ineffective because of limited preparation time and their client’s erratic behavior and cooperation.