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Contraband
03/05/2013

Owner of Colorado car dealership and 2 associates arrested for structuring and money laundering

DENVER — The owner of a Colorado car dealership and his two associates were arrested Tuesday by federal agents and local officers for structuring and money laundering.

These arrests were announced by the U.S. Attorney's Office, District of Colorado; U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI); the Internal Revenue Service's (IRS) Criminal Investigation; and the Drug Enforcement Agency (DEA). All three defendants were named in a sealed indictment returned by a federal grand jury in Denver Feb. 14.

Raul Mendoza, 48, Julia Castillo-Caraveo, 28, both of Denver, and Isidro Noe Mendoza-Ortiz, 25, of Thornton, appeared March 5 before a U.S. Magistrate judge, where they were advised of their rights, and the charges pending against them. All three are scheduled to appear in court on March 8 for a detention hearing and for arraignment.

In addition to the three arrests, agents and officers also executed search warrants at a residence and an automobile business. Twenty automobiles with clear titles from the car dealership were seized.

According to the indictment, beginning in February 2008 and continuing through May 2012, Raul Mendoza (Mendoza) and Isidro Noe Mendoza-Ortiz (Mendoza-Ortiz), conspired with each other and others to structure currency (the depositing of just under $10,000) by depositing transactions with the intent to evade the reporting requirements as required by law. Daily cash receipts from the business Chopeque Auto Sales, which is owned by Mendoza, were received at the business and structured into separate accounts at various banks to avoid the $10,000 reporting requirement. From Feb. 26, 2008 through May 29, 2012, they structured over 700 deposits totaling $4,543,714.

As part of the conspiracy, on June 4, 2011, Mendoza, Mendoza-Ortiz and Julia Castillo-Caraveo (Castillo-Caraveo), knowingly caused Chopeque Auto Sales, a non-financial trade or business, to fail to file a Federal IRS Form 8300, a report required by law for all currency transactions over $10,000 received by a business. Particularly, they sold a 2004 Dodge Ram 1500 in exchange for $10,500 that was represented by undercover law enforcement officers to be the proceeds of a specified unlawful activity (drug distribution) and they did so to conceal the nature of the proceeds of the specified unlawful activity, and to avoid IRS Form 8300 reporting requirements. On March 8, 2012, Mendoza and Castillo-Caraveo followed a similar pattern and sold a 2008 Chevrolet Silverado 1500 in exchange for $20,900 that was represented by undercover law enforcement officers to be the proceeds of a specified unlawful activity (drug distribution); no IRS Form 8300 was filed.

The defendants conspired to conceal the nature and source of the specified unlawful activity and attempted to launder drug proceeds. Particularly, Chopeque Auto Sales sold automobiles to known drug dealers, prepared false documents relating to the sale of vehicles to known drug dealers, structured currency deposits to conceal the source, and falsely claimed to law enforcement authorities to be a valid lien holder of a seized vehicle in order to assist a known drug dealer in seeking the return of the vehicle. Upon conviction of the offenses above, they shall forfeit to the United States all of the defendants' right, title and interest in all property, real or personal, involved in such offenses, or all proceeds traceable to such property, for which the defendants are joint and severally liable.

"Working with our federal, state and local law enforcement partners, we were able to uncover a sophisticated scheme where the defendants hid drug dealing proceeds by laundering the money through the sale of automobiles," said U.S. Attorney John Walsh.

"Drug smugglers use various creative means to launder and conceal their illegal drug profits," said Kumar C. Kibble, special agent in charge of HSI Denver. "HSI and our law enforcement counterparts were able to pool our law enforcement authorities and expertise to identify and investigate the significant structured deposits made under the guise of a legitimate car dealership."

"I applaud the fine work of the investigators and prosecutors who used very innovative techniques to shut down this financial conspiracy facilitating illicit drug trafficking organizations," said DEA Denver Field Division Special Agent in Charge Barbra M. Roach.

"Helping drug dealers launder drug money is unacceptable and illegal. IRS CI will work with our law enforcement partners to ensure those who do are brought to justice," said Stephen Boyd, Special Agent in Charge, IRS Criminal Investigation, Denver Field Office.

Mendoza was charged with three counts of structuring and three counts of money laundering. Castillo-Caraveo was charged with two counts of structuring and three counts of money laundering. Mendoza-Ortiz was charged with two counts of structuring and two counts of money laundering. If convicted, each count of structuring and money laundering carries a penalty of not more than 10 years in federal prison, and a fine up to $500,000.

This case was investigated by agents with HSI, IRS-CI, and DEA. In addition, Denver Police Department, Commerce City Police Department, Thornton Police Department, and Department of Revenue – Auto Industry Division assisted in executing the warrants.

Assistant U.S. Attorney Jim Boma, District of Colorado, is prosecuting this case. The asset forfeiture is being handled by Assistant U.S. Attorney Tonya Andrews.

The charges contained in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.