Trial Friday for 2 Accused of Helping to Launder Cash

Two Israeli nationals accused of being part of a $22-million international money-laundering ring are facing trial on conspiracy charges Friday in Santa Ana federal court.

The ring allegedly laundered more than $1.2 million in one five-day period last year by sending a series of cashier’s checks to a Panamanian financial institution that has been linked to a Colombian drug organization, Assistant U.S. Atty. Bonnie S. Klapper said.

The two defendants are Rivka Edri and Avraham Zarchia, 38, of Sherman Oaks. Edri, a mother of four, is free on bail and living in North Hollywood. Zarchia is in custody.

They are charged with conspiring to evade the reporting requirements of federal law governing large transfers of funds, both within the United States and abroad.

Reports Must Be Filed

Two other defendants in the case have pleaded guilty and apparently will testify for the government, according to defense attorneys. Edri’s husband, Izhak, also faces trial on similar charges.

Financial institutions must file reports of cash transactions of $10,000 or more, and no cash may be transported outside the United States in amounts of $10,000 or more unless a report is filed with the Internal Revenue Service.

The law also forbids avoiding the reporting requirements by “structuring” transactions, such as transferring a big sum through a series of smaller transactions. That provision was designed to curb money laundering and other activities involving concealment of funds from government scrutiny, according to Klapper.

In the case going to trial Friday before U.S. District Judge J. Spencer Letts, prosecutors say they will produce cashier’s checks for $1,271,510 that were seized in five days of surveillance. In addition, they say, checks for more than $830,000 were discovered when the suspects were arrested.

The ring may have been operating for as long as five months before U.S. Customs Service agents broke it up last September, according to information in government papers in the case.

Agents began surveillance of Izhak Edri on Sept. 17 at a Federal Express office in Encino. He had dropped off a package for delivery in Panama that allegedly contained 32 cashier’s checks, each made out for less than $10,000 but totaling $285,980.

Edri then drove to apartments in Sherman Oaks and North Hollywood, several times switching automobiles in what authorities allege was an attempt to evade surveillance. He picked up three envelopes at the two locations and shipped another $164,000 in 21 cashier’s checks through another Federal Express office, in Toluca Lake.

Edris and Zarchia face a maximum of 105 years each in prison and substantial fines if convicted.

Drugs Believed Source

Klapper said the indictment doesn’t charge specifically that the funds were from drug operations, but she said prosecutors, who are not required to prove the source of the funds in their criminal case, “strongly believe” that they represent drug profits.

On Tuesday, Letts ruled that Izhak Edri should be tried separately from his wife and Zarchia. Letts ordered the husband tried “immediately” after the trial of his wife.

Lawyer Stanley Greenberg, representing the wife, complained Tuesday that the government had failed to turn over a complete list of witnesses before trial.

Klapper told Letts that she had guaranteed several “very frightened” witnesses that she would not reveal their names until immediately before trial.

The alleged ring was described by Klapper as “quite big.”

“We have Federal Express records showing they shipped as early as March (1987),” Klapper said. “Our assessment is that between mid-March and September they probably shipped out about $22 million. That’s a substantial money-laundering enterprise.”