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The Cornerstone Report

Safeguarding America Through Financial Investigations

Volume VI: No. 3 • Summer 2009

A Study in Money Laundering

A joint investigation by U.S. Immigration and Customs Enforcement (ICE) and the Drug Enforcement Administration (DEA) into drug trafficking at the Southwest border revealed a multimillion dollar money laundering organization, utilizing multiple companies, and numerous bank accounts, to launder narcotic proceeds. This case study demonstrates methodologies used for laundering criminal proceeds.

In 2004, ICE agents in Brownsville, Texas, received information that Oscar Oropeza, along with his wife Tina, daughter Paulina and son Juan, were using various businesses they owned to launder proceeds derived from narcotic sales. The Oropeza family owned substantial assets in both Brownsville and Harlingen,Texas, including a car wash, landscaping business, trucking company, a large house, and numerous vehicles valued between $60,000–$120,000 each.

One of the first developments linking the Oropeza family to narcotics occurred in April 2004. Juan Hernandez and other defendants were arrested by local police in Harlingen, Texas, after they were linked to a narcotic smuggling operation utilizing truck lines to ship marijuana out of the Rio Grande Valley, to Florida. As a result of this arrest, Hernandez received more than three years in a state penitentiary. DEA agents in West Palm Beach, Florida, learned of Hernandez's arrest and asked ICE for additional information about his drug operation. This information linked Milton Oquendo to the narcotic smuggling in Florida. DEA subsequently arrested and charged him in Florida for his role in the organization. Hernandez and Oquendo were each sentenced to ten years as a result of this indictment.The money laundering activities being conducted by the Oropeza family were directly linked to Hernandez and Oquendo.

In July 2006, investigators caught a break in the case when Tina Oropeza was stopped and questioned by Harlingen police officers while riding on a north-bound bus headed out of the city. Officer's discovered she was carrying approximately $90,000 in cash, which they seized.

Subsequent financial records checks showed that the Oropeza family had more than 20 accounts with several banks. Personal bank accounts connected to the money laundering activity were held by all four Oropeza's. Account statements from these personal accounts reflected cash deposits well in excess of $1 million in just over two years. Of these cash deposits, the vast majority consisted of cash deposits of less than $10,000, and often involved multiple cash deposits on the same date.

Statements for the multiple business accounts reflected cash deposits well in excess of $2 million in just over two years. The business accounts had over $3.6 million in deposits for 2006 alone. A large portion of the cash deposits also consisted of amounts less than $10,000, and often involved multiple cash deposits on the same date. These numerous cash deposits were conducted by all four Oropeza family members.

Prior to opening an investigation, ICE learned that Oscar Oropeza paid for a building connected to his landscaping business with two cash payments. The first payment was $221,000, and the second was for approximately $120,000, both of which consisted of primarily $20 bills.

The case saw another critical development on May 31, 2007, when Oscar and Tina Oropeza were stopped for traffic violations by local police in Mobile, Alabama. Oscar Oropeza gave verbal consent to search their van, which revealed a hidden compartment in the floor area. The officers discovered four aluminum containers concealed within the compartment containing 84 packages wrapped in plastic wrap and duct tape. The packages contained a white powdery substance that field tested positive for cocaine; Oscar and Tina Oropeza were arrested on state charges for transporting cocaine.

In May and June 2007, ICE agents served search warrants on seven properties owned by the Oropeza family in Brownsville,Texas. The search warrants resulted in the seizure of several vehicles, luxury jewelry items, and currency. ICE agents also served seizure warrants on 13 bank accounts and three safety deposit boxes connected to the Oropeza family, resulting in the seizure of more than $310,000.

The amount of currency, funds, property, and vehicles seized by ICE agents in Brownsville totaled more than $2.1 million. Five real properties valued in excess of $1 million were also forfeited.

In March 2008, Tina Oropeza pled guilty to federal charges related to narcotics smuggling and to money laundering conspiracy. Paulina Oropeza pled guilty to federal charges because of her knowledge of the money laundering activities. In November 2009, Tina Oropeza was sentenced to 10 months prison, five years probation, and a $25,000 fine. Paulina Oropeza was sentenced to five months in prison, five years probation, and a $5,000 fine.

Oscar Oropeza was sentenced to 180 months in the federal penitentiary for conspiracy to possess more that 1,000 kilograms of marijuana, and 180 months for conspiracy to posses more that five kilograms of cocaine. Oropeza was also sentenced to 180 months for conspiracy to possess with intent to distribute approximately ninety kilograms of cocaine. All of the sentences are to run concurrently for a total of 180 months. Oropeza was also ordered to serve five years of supervised release and to be deported to Mexico.

Red Flag Indicators

• Various reported occupations (attorney, owner of Green Wealth Group, financial analyst, etc.) by the same individual on BSA filings.
• The acquisition or purchase of high-value ticket items (real estate) with cash.
• Large number of business and personal accounts at different financial institutions.
• Numerous structured cash deposits into both personal and business bank accounts.
• Deposits made in different bank branches on the same day, and deposited into the same account.