U.S. Assistant Attorneys Daniel Silva (619) 546-9713 and Mark W. Pletcher (619) 546-9714
PRESS RELEASE SUMMARY – June 3, 2021
SAN DIEGO – Lei Zhang, of Las Vegas, Nevada, was sentenced yesterday by federal court to 15 months in prison and forfeited $ 150,000 for running an unlicensed money transfer business.
Zhang is believed to be the first person in the United States to be convicted of his role in developing a new form of illegal underground financial institution that transfers money between the United States and China, thereby enforcing domestic and foreign money transfer laws and reporting evades, including United including State Anti-Money Laundering Controls and Chinese Capital Flight Controls.
As stated in court documents, Zhang collected US dollars (in cash) from various third parties in the United States and delivered that money to a customer, usually a high roller player from China, who had no easy access to cash in the US States due to capital controls that limit the amount of Chinese currency that a person can convert into foreign currency to $ 50,000 per year. After receiving the US dollars, the player transfers the equivalent of the Chinese yuan (using a banking app) from the customer’s Chinese bank account to a Chinese bank account named by Defendant Zhang. In order to facilitate these transactions, Zhang was paid a commission based on the illegally transferred monetary value.
Zhang also admitted that he was regularly introduced to customers by casino hosts who were trying to improve casino customers’ gambling. By connecting money hungry gamblers in the United States to Zhang’s illegal money transfer businesses, the casinos increased the domestic cash game of their China-based high-roller customers. All a player needed was a mobile device with remote access to a China-based bank account. As a result, Zhang managed to transfer and convert electronic funds in China into hard currencies in the United States while bypassing the obstacles imposed by both China’s capital controls and anti-money laundering controls imposed on all US financial institutions. were imposed. Casino hosts often received a cut on Zhang’s commission for their efforts.
“The pioneering work these investigators have done in identifying and tracking down this new form of illicit money transfer cannot be overstated,” said acting US Attorney Randy Grossman. “Prosecuting global money laundering is a priority for US attorneys.”
Special agents from Homeland Security Investigations, the IRS Criminal Investigation Las Vegas Financial Crime Task Force, and the Drug Enforcement Administration led the investigation into Zhang’s operations.
ACCUSED file number 20-CR-370-WQH
Lei Zhang Las Vegas, NV Age: 41
SUMMARY OF CHARGES
Operating an Unlicensed Money Transfer Business – Title 18, USC, Section 1960
Maximum sentence: Five years in prison and a fine of $ 250,000
Homeland Security Investigations
IRS Criminal Investigation Las Vegas Financial Crime Task Force
Drug Enforcement Administration