No Bail for Money-Exchange Owner : Judge Says Currency-Laundering Suspect May Flee U.S.

The owner of a San Ysidro currency exchange arrested this week on suspicion of concealing millions of dollars may have been “laundering” proceeds from illegal drug deals, a federal magistrate said in court Friday.

U.S. Magistrate Irma E. Gonzalez ordered that Patrick E. Solorzano-Wizer, owner of the Casa Blanca Money Exchange in San Ysidro, be held without bail because of the possibility that he may flee to Mexico.

Solarzano-Wizer, 25, a Mexican citizen who now resides legally in San Diego, was arrested at his business Tuesday after officials unsealed an 89-count federal indictment charging him with a scheme to conceal nearly $15.8 million from U.S. authorities. The money was transferred by wire from San Ysidro bank accounts controlled by Solarzano-Wizer to the accounts of Panamanian and Colombian banks in New York, Miami and Zurich, according to court testimony.

Overseas banks, particularly those in Panama, are common destinations for the deposit of narcotics proceeds, according to federal investigators. The U.S. attorney’s office, which is prosecuting Solorzano-Wizer, has made no allegations that any of the nearly $15.8 million transferred at his direction were drug-sale proceeds.

But Gonzalez, in explaining her decision not to grant bond, expressed her opinion that the money “is coming from illegitimate sources” and that Solorzano-Wizer may be “somehow involved in the laundering of narcotics money.”

Money-Laundering

Money-laundering is the process whereby proceeds from illegal activities are deposited in banks or invested to make the money appear legitimate. The process is critical for drug dealers, who must operate their businesses with large sums of cash.

Solorzano-Wizer has pleaded innocent to the charges and his attorney, Stephen Munkelt, said he is a legitimate businessman. Munkelt said he had yet to determine the exact source of the nearly $15.8 million that his client is alleged to have concealed.

Solorzano-Wizer plans to appeal Friday’s no-bail ruling in U.S. District Court, said Munkelt.

The ruling was met with tears from Solorzano-Wizer’s 21-year-old wife, Debra, and mother, Phyllis, who sat in the courtroom for the three-hour hearing.

The case is part of an ongoing federal crackdown against currency exchanges and banks that operate in the border community of San Ysidro. The area is thought to be a busy conduit for the laundering of millions of dollars in Mexican drug money.

To ferret out money launderers, investigators have relied on federal requirements that banks, money exchanges and other financial institutions report to the U.S. Internal Revenue Service each cash transaction of more than $10,000. The reports create a paper trail, enabling investigators to trace the source of suspected criminal proceeds.

Charges Cited

The indictment against Solorzano-Wizer charged that the money trader received numerous sums of more than $10,000 from unidentified sources and did not file the required currency-transaction forms. Specifically, Solorzano-Wizer is charged with not filing reports for 42 transactions of greater than $10,000 that occurred between Feb. 4 and Oct. 21. The transactions, totalling nearly $15.8 million, ranged in amounts from $63,825 to nearly $1.3 million.

Solorzano-Wizer deposited the money in the San Ysidro branches of Balboa National Bank and Crocker National Bank. No wrongdoing was alleged against the banks in connection with this case.

In August, the Treasury Department fined Crocker $2.25 million for failing to meet currency-reporting requirements, making it the first California bank to be so penalized.

Solorzano-Wizer faces substantial penalties if convicted. Each count of the 89-count federal indictment carries a maximum penalty of five years in jail and a $250,000 fine, according to Barry Moscowitz, the assistant U.S. attorney handling the case.

Apart from the criminal charges, federal authorities have also seized $712,500 in connection with the case against Solorzano-Wizer. The ownership of the funds remains unclear.

Separate Conviction

Meanwhile, Solorzano-Wizer is scheduled to be sentenced Thursday on his separate state conviction of attempting to bribe a city police officer who arrested him March 15 on suspicion of cocaine possession, according to court records. Solorzano-Wizer pleaded guilty to the charge last month and faces three years in prison on the felony conviction, according to Munkelt. Solorzano-Wizer offered the officer $1,000 and his Porsche sports car to forget the cocaine charge, according to court records.

The car was one of two Porsches owned by Solorzano-Wizer, who also owns a Mercedes-Benz, an Audi, a Mercury Topaz and a $90,000 condominium in Chula Vista, according to court testimony.

Solorzano-Wizer, the eldest son of a wealthy Mexico City family, has lived in San Diego for three years and has run the Casa Blanca Money Exchange since 1983, according to court records.

In court papers filed in connection with his state bribery case, Solorzano-Wizer requested that he not be sentenced to jail. “I started meeting the wrong people when I first got to San Diego,” Solorzano-Wizer explained. “I’ve learned my lesson about drugs, and the consecuences (sic) they bring . . . . I’ll never commit a crime again.”