The Cornerstone Report: Volume 4, Issue 1

ICE Uncovers Immigration Violations, Money Laundering at Maryland Seafood Supplier

A 2005 ICE investigation of human smuggling, illegal immigration and money laundering in Maryland underscores the international aspect of criminal activity in the 21st century—and how a seemingly legitimate business can become a vehicle for money laundering, smuggling and other crimes.

The Baltimore ICE Special Agent in Charge led the investigation into a large-scale alien smuggling and money laundering operation at Chang Jiang Seafood, Inc., a wholesale seafood supply company.

Chang Jiang Seafood was a wholesale seafood supplier that employed and harbored illegal aliens and used the business to launder illicit funds derived from immigration violations. Chang Jiang Seafood was owned and operated by Bao Wang and his wife Trang Lu. Wang and Lu were also partners in similar seafood businesses operating in various locations throughout the United States.

The investigation identified monthly cash deposits averaging over $1.8 million made into Chang Jiang Seafood accounts during 2003–2004. Wang and Lu knowingly employed illegal Chinese aliens, whom they recruited through the local Chinese community.

Wang and Lu harbored the illegal aliens, providing them with food, living quarters and basic necessities, and used these illegal employees to help recruit other illegal aliens. Employees were generally paid in cash, their income was untaxed and they were provided with no record of payment.

Wang and Lu converted part of their warehouse in Baltimore to house illegal alien employees and rented two apartments in close vicinity to the business for housing additional illegal workers. Later, Wang and Lu purchased a small house in Baltimore for housing illegal employees. In all cases, the living conditions provided for the aliens were crowded, unsanitary and a fire hazard.

Records showed that Wang and Lu wire transferred millions of dollars from their bank account to a seafood supply company in China, but received only a fraction of the value of their “purchases” in seafood in exchange. Financial analysis of the business accounts and extensive work with various banks revealed cash deposits in excess of $1.8 million per month. The largest single cash deposit was over $1 million. Approximately 75 percent of Chang Jiang Seafood’s deposits were in cash.

According to legitimate seafood distributors, a reasonable cash intake is 25 percent or less. Lu made the majority of all cash deposits. Her cavalier attitude when bringing in as much as $1 million in cash raised a red flag to bank employees, who filed several Bank Secrecy Act (BSA) reports concerning the activity.

Results

At the conclusion of the investigation, ICE seized approximately $2.6 million in cash and property from Chang Jiang Seafood’s business operations. Fourteen individuals were arrested as a result of this investigation. The two main targets, Wang and Lu, pleaded guilty to charges of employing and harboring illegal aliens.

On June 13, 2005, Wang and Lu, as part of a plea agreement, were sentenced in U.S. District Court in Maryland to one year of home detention and one year of probation and were each fined $10,000. Wang and Lu agreed to forfeit claim to the $2.6 million in cash and property. On September 30, 2005, an order of final forfeiture was executed for the $2.6 million in cash and property seized in relation to this investigation.

The Goal

Apprehending and bringing violators to justice is one of the best ways to deter and prevent abuse in any system. Investigating and arresting violators who are using the Internet to launder and transfer money is therefore a primary goal of the E-Cornerstone initiative.

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ICE Uncovers Immigration Violations, Money Laundering at Maryland Seafood Supplier

Cornerstone is U.S. Immigration and Customs Enforcement's (ICE) comprehensive investigative initiative for fighting financial crime, trade fraud and intellectual property crime.

The Cornerstone Report is a quarterly bulletin highlighting key issues related to ICE financial and trade investigations.

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