Federal prosecutors intend to seize $80 million in assets--including a 10-story building in downtown Los Angeles--from 33 wholesale jewelers and associates who were indicted Wednesday for allegedly laundering cocaine profits.
The seizures in the money-laundering case would exceed the $60.6 million in property and money seized by the U.S. attorney’s Los Angeles office during all of 1988, U.S. Atty. Robert Bonner said at a news conference.
The indictments, returned Tuesday night, had been anticipated since Feb. 22, when hundreds of personnel from various law enforcement agencies raided the Los Angeles Jewelry Mart, the city’s fast-growing jewelry center that is home to nearly 2,000 entrepreneurs in high-rise buildings and storefronts along Hill, 5th, 6th and 7th streets.
More than 30 people were arrested, and 640 pounds of cocaine was seized as authorities attacked what they called the largest drug-money laundering ring ever smashed by the government.
If convicted on the charges of conspiracy to aid and abet narcotics trafficking, the defendants could face up to life imprisonment. The maximum sentence for money laundering is 20 years in prison and fines up to $25 million.
Bonner said that in the aftermath of the arrests the government has seized $6.7 million in cash in Los Angeles and New York, $7 million in bank accounts in the two cities, $30 million in gold and jewelry at 13 stores in the Los Angeles Jewelry Mart and gold bars worth $12 million at a refining company in Hollywood, Fla.
The government is permitted to keep the assets if it can establish in a civil court hearing that they were obtained as a result of the laundering of drug money. The moves against the assets usually take place long before conviction of the suspects.
Government attorneys on Wednesday also filed motions in U.S. District Court contending that nine pieces of Los Angeles real estate owned by the defendants, worth $24.1 million, should be forfeited.
The properties include the Jewelry Theater Building, a $17-million, 10-story building at 411 W. 7th St. A plaque inside the building says it was once the “Warner Brothers Building,” but several longtime employees of Warners said they could not remember a downtown movie theater in that location.
A source close to the investigation said that one of two alleged kingpins of the ring, Wanis Koyomejian, 47, of Northridge, has a $7-million interest in the Jewelry Theater Building. The balance is owned by financial institutions, whose “interest will be protected” when and if the government obtains and sells the building, the source said.
Koyomejian is the owner of Ropex Corp., which has two ninth-floor suites in the Los Angeles Jewelry Mart and also maintains offices in New York and Houston. Koyomejian owns three of the eight other parcels sought by the government, prosecutors said. He has been held without bail since his arrest.
Bonner was joined at the news conference by eight federal and local law enforcement officials whose organizations collaborated in the 15-month investigation code-named Operation Polar Cap.
Investigators said that during the last three years, jewelers in the ring collected carton after carton of drug money packed like bricks and shipped by armored car from a web of contacts in Los Angeles, New York and Houston.
In back rooms of the Los Angeles jewelry district, the flow of drug money was so overwhelming that the cash had to be counted on sophisticated high-speed machines, officials said.
Another alleged mastermind of the scheme who was indicted was Nazareth Andonian, 33, of La Crescenta. Andonian, along with his brother, Vahe, operates Andonian Brothers Inc., doing business as Nazareth Jewelers on 5th Street.
Between them, Koyomejian and the Andonian brothers laundered about $500 million through bank accounts that they controlled at Los Angeles banks, the indictments said.
Also indicted was Raul Vivas, an Argentine national living in Uruguay, who allegedly oversaw the entire money-laundering operation from Uruguay.
The grand jury indictments charged that the defendants collected money from drug distributors who sold cocaine imported from Colombia. Boxes of cash were sent to Koyomejian’s and Andonian’s businesses, and the money was subsequently deposited into bank accounts, the indictment said. Through wire transfers it was sent to New York, Panama City, Panama and Montevideo, Uruguay.
The indictment said the laundering operation was an integral part of a Colombian narcotics trafficking operation in which the laundered money was returned to Colombian drug merchants, who used it to finance more large shipments of cocaine into the United States. However, the indictment named no Colombians, referring to them only as “unknown co-conspirators.”
The indictment characterized Vivas in Uruguay as “the end of the funnel . . . of the money-laundering operation,” Bonner said. However, when it comes to determining where the money went once it allegedly left Vivas’ hands in Uruguay, “the trail becomes a little colder,” he said.
Held in Uruguay
Vivas, who has been in custody in Uruguay since the day of the Los Angeles raid, established a money exchange business in 1986 in Montevideo, Bonner said. Vivas and another of those indicted, Sergio Hochman, a Uruguayan arrested in Los Angeles about 10 days ago, were involved in the receipt of hundreds of millions of dollars, Bonner said.
John Zienter, head of the Drug Enforcement Administration office in Los Angeles, told Wednesday’s news conference that the effect of the arrests has been so great that his office has learned of threats of retaliation from kingpins of drug cartels against American law enforcement agents.
“We are getting feedback now which indicates we will get some major retaliation against law enforcement,” Zienter said. “This certainly indicates we’re doing something right or they wouldn’t be willing to go to that extent.”