Colombian brokerage firms may have laundered up to US$4 million worth of profits from drug traffickers, highlighting how brokers may play a key role in covering up dirty funds.
According to an investigation by Colombian newspaper El Espectador, twelve former brokers — including nine Colombians who have already been extradited to the US — are set to face trial at the US Court of the Southern District of Florida on money laundering charges. They are accused of laundering more than $4 million for criminal organizations in Mexico and Puerto Rico between 2004 and 2011.
Key to the case is Carlos Leyton Sinisterra, a former broker who was arrested in Colombia on November 13, 2012, and is currently facing an extradition order to the US. Leyton was the legal representative or the director of three brokerage firms that have been accused of shady dealings in Colombia.
Leyton and a commission agent, Fanny Esperanza Gil, are accused of masterminding the scheme. Criminal organizations would transfer cash from money exchange businesses, or “casas de cambio,” in Mexico, Puerto Rico, New York, and Switzerland, to the bank accounts of Colombian brokers. They disguised the true source of the cash by attributing the payments to fees charged by various Colombian brokerage companies. They also used a Florida-based front company, Logistical Engineering Inc., to launder the funds.
According to the US indictments viewed by El Espectador, Leyton, Gil, and another collaborator moved over $470,000 in dirty money in seven transactions between 2004 and 2011. Another group of five brokers moved over $2 million between 2007 and 2008. Four other brokers were involved in illicit transactions worth more than $900,000.
The case file says that a witness currently protected by the US recorded a series of meetings between Leyton, Gil, and their collaborators between June 2007 and June 2012, in which they acknowledged the funds came from the drug trade, and admitted that Logistical Engineering Inc. was nothing more than a front company.
It remains to be seen whether Leyton will be extradited soon to the US. The head of Colombia’s Liberal Party has said that Leyton should stay in the hands of Colombian law enforcement, as he is linked to captured Colombian drug trafficker Daniel “El Loco” Barrera, and could be a key witness in determining how Barrera’s organization laundered its profits.
One unresolved question is whether this case has anything to do with the dramatic collapse last year of Colombia’s largest brokerage firm, Interbolsa. The firm, which once oversaw one-third of the daily operations on Colombia’s stock exchange, was liquidated last November after it failed to make a scheduled $11 million payment. El Espectador notes that one of the shady brokerage firms once managed by Leyton was owned by Juan Carlos Ortiz, an economist who helped direct Interbolsa and who left Colombia shortly after the firm’s collapse. Leyton himself was arrested just days after Interbolsa went under.
The newspaper reports that a commission from Colombia’s Attorney General’s Office was recently in Miami interviewing the brokers involved in the Carlos Leyton case, and may have been quizzing them about Interbolsa, further suggesting a link between the two scandals. “We want information that the US has about the relationship between narcos and brokers that could help us with [legal] processes in Colombia,” an unnamed source from the Attorney General’s Office told the newspaper.
The affair is also indicative of how long it takes to gather the evidence needed to build a strong case against suspected money launderers. According to El Espectador, US authorities were tracking suspicious activities by the brokers since 2004, but no arrests were made in Colombia until last year.
Colombia frequently collaborates with the US in money laundering cases. Authorities from both countries recently broke up a money laundering ring accused of handling some $25 million in cash since 2006. If it turns out that the extradited brokers involved in the Leyton affair have some insight on the decline of a firm as large and as powerful as Interbolsa once was, hopefully US authorities will ensure that this information can be used in future investigations aimed at cleaning up Colombia’s brokerage business.