Money Laundering

The money laundering statutes, 18 U.S.C 1956 and 1957, were originally intended to deprive drug traffickers of the profits of their criminal activity, but the statutes are often employed to prosecute anyone who attempts to conceal the proceeds of dozens of federal offenses.

Money laundering charges are sometimes brought alone, but most often are added on to prosecutions for other offenses because of the lengthy sentences persons can receive if convicted. This is a way that prosecutors are able to coerce persons to plead guilty instead of insisting that the government prove its allegations beyond a reasonable doubt to a jury at trial.

An example of such use of these statutes is found in the context of an investigation of bribery of Ecuadorian officials under the Foreign Corrupt Practice Act (FCPA).

Press Release – Friday, October 11, 2019

Miami-Based Financial Advisor Pleads Guilty for Conspiring to Launder Money Relating to FCPA and Ecuadorian Bribery Law Violations

A financial advisor based in Miami, Florida, pleaded guilty today to a money laundering conspiracy for his role in using the U.S. financial system to launder money to promote violations of the Foreign Corrupt Practices Act (FCPA) and Ecuadorian bribery law violations and to conceal and disguise the true nature of those illegal bribe payments. Specifically, this conspiracy related to a scheme to pay bribes to officials of Ecuador’s state-owned and state-controlled oil company, Empresa Pública de Hidrocarburos del Ecuador (PetroEcuador).

Frank Roberto Chatburn Ripalda (Chatburn), 42, a dual U.S. and Ecuadorian citizen, pleaded guilty in federal district court in Miami before the Honorable Marcia G. Cooke to one count of conspiracy to commit money laundering, which carries a 20-year statutory maximum sentence. Chatburn is scheduled to be sentenced by Judge Cooke on Dec. 18.

According to his admissions at the plea hearing, Chatburn conspired with an oil services contractor to pay nearly $3 million in bribes to Ecuadorian government officials in an effort to obtain and retain contracts with PetroEcuador. As a financial advisor to the contractor, Chatburn agreed to make bribe payments for the benefit of several then-PetroEcuador officials through the use of shell companies and bank accounts in the United States, Panama, the Cayman Islands, Curacao and Switzerland. To conceal the bribe payments and to promote the scheme, Chatburn established Panamanian shell companies with Swiss bank accounts on behalf of two then-PetroEcuador officials.

Chatburn further admitted that he conspired with another Ecuadorian government official to conceal bribe payments intended for the official from Odebrecht S.A., the Brazilian construction conglomerate. Chatburn facilitated hiding these bribe payments by conducting the transactions through several shell companies and bank accounts in multiple jurisdictions, including in the United States. Odebrecht S.A. pleaded guilty on Dec. 21, 2016, in the Eastern District of New York to conspiring to violate the anti-bribery provisions of the FCPA in connection with a broader scheme to pay nearly $800 million in bribes to public officials in twelve countries, including Angola, Argentina, Brazil, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Mozambique, Panama, Peru and Venezuela.

To date, 10 individuals, including former Ecuadorian government officials, oil services contractors and financial advisors, have pleaded guilty to criminal charges in U.S. courts for their involvement in the PetroEcuador bribery and money laundering schemes.

Miami-based Financial Advisor Pleads Guilty for Conspiring to Launder Money Relating to FCPA and Ecuadorian Bribery Law ViolationsU.S. Department of Justice