Feds Indict Wives of Bank of China Execs in $485M Money Laundering, Immigration Fraud Scam

Nothing in the story connects it to North Korea, although the Bank of China has been the subject of published reports in connection with the “supernote” money-laundering investigation. From the Justice Department . . . .

WASHINGTON, D.C. ““ A federal grand jury in Las Vegas has indicted two former managers of the Bank of China, their wives, and a relative of one of the couples on charges of racketeering, money laundering and fraud, Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada announced today.

Xu Chaofan (a/k/a Hui Yat Fai), Xu Guojun (a/k/a Hui Kit Shun), Kuang Wan Fang (a/k/a Wendy Kuang), Yu Ying Yi, and Kwong Wa Po were charged in the 15-count superseding indictment. The charges in the indictment stem from an elaborate scheme to defraud the Bank of China of at least $485 million, orchestrated by former managers Xu Chaofan, Xu Guojun and a third former bank manager, Yu Zhendong (a/k/a Yu Wing Chung) who has pleaded guilty in connection with this investigation and is cooperating. The scheme allegedly involved efforts by the bank managers to launder the stolen money through, Hong Kong, Canada and the United States, among other countries, and then immigrate to the United States from China with their wives by obtaining false identities and entering into sham marriages with naturalized U.S. citizens. The bank managers’ true wives, Kuang Wan Fang and Yu Ying Yi, allegedly assisted their husbands in laundering the proceeds of the fraudulent scheme and violated U.S. immigration laws by entering this country illegally and then securing United States citizenship and passports through fraudulent means.

The indictment alleges that Kwong Wa Po, the brother of Kuang Wan Fang, a fugitive, participated in the elaborate scheme to launder the stolen money.

The first count of the indictment charges all five defendants with engaging in a RICO conspiracy that began in 1991 and continued until October 2004, upon the arrest of the former bank managers and their wives. The underlying racketeering activities alleged included engaging in monetary transactions with stolen money, transportation of stolen money, passport fraud, and visa fraud. According to the indictment, the former bank managers created a number of shell corporations in Hong Kong and, with the assistance of others, funneled the bank’s money into these companies as well as numerous personal bank and investment accounts. Assisted by their wives, relatives and others, the former bank managers then laundered the stolen proceeds through Canada and the United States. The indictment charges the defendants with laundering a significant amount of the stolen money through Las Vegas casino accounts.

The previous report casting suspicion on the Bank of China focused on the laundering of proceeds of North Korean dope sales and counterfeiting. Given the timing of the new indictment, shortly after the “cascading” of the Smoking Dragon busts, I wouldn’t be surprised to learn that this scheme used the same M.O. as the North Korean scheme, or that both investigations were interconnected somehow.

Thanks to a reader for the tip.