Wednesday, July 23, 2014


Roman Seleznev, the accused Russian hacker, sits in a cell in the US Territory of Guam,while his attorneys fight his removal to District Court in the State of Washington, where he faces major felony charges. He also has Federal criminal charges pending against him in Nevada. The defendant's attorneys have made serious accusations against the US Secret Service, regarding the circumstances surrounding his detention, and transport to Guam. Though most Federal decisions do not inquire into how a defendant was brought before the Court, there are some decisions where a defendant did receive relief for constitutional violations.

Seleznev's attorneys have filed a Motion for Discharge and Release, pursuant to Federal Criminal Rule 12(b)(3)(A). Their accompanying memorandum of law asserts:

(1) The Guam District Court lacks jurisdiction over Seleznev, because his abduction by us agents, in the Maldives, constitutes Outrageous Governmental Misconduct.

(2) The methods through which the US Government secured the defendant's presence violates due process, as well as the extradition law of the Maldives, which requires that the Court divest itself of jurisdiction over his person.

(3) Extraterritorial abduction violates customary international law.

(4) Alternatively, the Court should dismiss all the pending criminal charges, to implement a remedy for the violations, to preserve judicial integrity, and to deter future similar illegal conduct.

The US Government has responded; it its rebuttal, it states that the Rule 5 Identity Hearing, on confirming whether the detainee is the indicted Roman Seleznev, which is a removal proceeding, to decide whether to transfer him to the State of Washington for trial, limits the Guam Court's jurisdiction to the sole issue of identity for transfer. It is further suggested that only the District Court in Washington has jurisdiction over the discharge motion.

The reply of the defendant's counsel: Jurisdiction is a threshold issue. It is fundamental and primary, and cannot be deferred for a transferee court.

There are several issues of fact, regarding the circumstances of the defendant's detention, transport, and arrival in Guam, all of which have been raised by defense counsel, and which should be resolved, but whether this will occur now, or at the trial court in Washington, is now up to a Federal Judge in Guam. We shall continue to monitor this case, and update our readers on further rulings of the Court.

Tuesday, July 22, 2014


What are the red flags (indicators) that tell you that an account is being used to pay human traffickers who are engaged in smuggling aliens into the United States from abroad ? I have annotated it,  to better explain what happens in these accounts and, to facilitate your recognition of such activity:

(1) A smuggler opens accounts in a US border state. Remember that both our northern and southern borders are used to smuggle immigrants into the Continental United States, as well as maritime routes, often through the Caribbean, into Florida.

(2) The deposits, which pay for the smuggling, are always under $10,000 in cash, so as not to trigger the reporting requirements. US-based relatives of the immigrants to be smuggled in often pay the costs of the illegal transport. The going rate in many areas is $8000 per person.

(3) The deposits are made in geographical areas remote from the border, into large American banks which have branches in several states. Many of the payors live in the northern states, and send the money to traffickers, who maintain accounts in the border states.

(4) The depositors do NOT know the account holders. When questioned by tellers accepting payment, they often have none of the information about the account holders that would be expected in a legitimate transaction.

(5)  Deposits into what appear to be business accounts are from businesses not related to the type of business of the account holders. The business accounts are purely fronts to receive payments, and you will not find any normal account activity of the type you would expect an active business to have, only in-and-out money movement; and no purchases of any kind.

(6) The handwriting on the signatures generally does not match that on the rest of the check, indicating that the amount, and the payee's name, is often filled in later by the traffickers, or that third parties are involved in the laundering of the money.

(7) After the money is received by the traffickers, they often close the accounts, and open new ones at other US banks in border states. This continuous process, of closing and opening new accounts, is
designed to frustrate any investigation of their activities, and to impede their identification by US law enforcement.

(8) Sometimes, the money in the funnel accounts is wired to Mexican banks.

Variations on these themes often occur, so be alert to any permutations or combinations of these red flags.

Monday, July 21, 2014


FMBE Bank Ltd., formerly known as the Federal Bank of the Middle East, a Lebanese-owned bank in Cyprus, was designated an institution of primary money laundering concern by FinCEN*, and has been taken over by the Cypriot government. Now incorporated in Tanzania, the bank appears have been suspected of extensive money laundering, sanctions violations, and terrorist financing.

The allegations include:

(1) Clients used the bank to evade international sanctions against Syria.
(2) Payments to Hezbollah were allegedly made through the bank.
(3) The widespread use of shell companies, by bank clients, for the purposes of money laundering.

Compliance officers who access Country Risk should review all the information available in this case, and consider whether to increase it for Cyprus at this time.

Sunday, July 20, 2014


In a Reply Memorandum, filed in connection with his pending Motion for a New Trial, Richard Chichakli has alleged that the United States government deliberately sabotaged his ability to prepare for trial, in which he was acting as his own counsel, pro se. Chichakli has stated that, had he known about the prior inconsistent statements of a government witness, an aviation dealer from whom he attempted to illegally purchase a passenger jet, he would have impeached him in the stand, and not be found guilty. He is accusing the government of failing to timely disclose important evidence, resulting in his conviction.

Chichakli says that the government intentionally had him housed in the SHU, the area of the Federal jail where inmates are kept in isolation, and where he could not adequately prepare for trial. He also alleges that he was moved around, which further interfered his ability to conduct his own defense.

Finally, he says he did not receive the material that showed prior inconsistent statements of a witness until the first day of trial, when the witness was on the stand. He asks how he could have reviewed the material at that late state, especially since he was acting as his own attorney. He also states that he received additional discovery, during the trial, which was far too late to review it.


Scott Rothstein: now serving a 50-year sentence 

An individual associated with the Banyon Group,  which are hedge funds, has been charged with Conspiracy to commit Wire fraud, in connection with the Scott Rothstein Ponzi scheme. Frank Preve, who reportedly steered investors to Rothstein's phantom legal settlements, is accused of obtaining $20m in additional investments, after he know that Rothstein's had stopped paying out returns. He also allegedly made material misrepresentations regarding verification of the existence of the bogus settlements that he purportedly conducted, and attested to in a memorandum.

Preve was charged through a criminal Information, not a Grand Jury indictment, which is generally an indication that the defendant is cooperating with the US Attorney's office. The maximum possible penalty is five years in Federal Prison, and a $250,000 fine. He has a civil suit pending against him, filed by the Securities & Exchange Commission.

Saturday, July 19, 2014


Richard Meddings, who insulted America's Iran sanctions program, as his bank intentionally evaded it, has finally left Standard Chartered. His infamous " You f__king Americans" statement personified the attitude of that minority of greedy, amoral international bankers, who often choose lucrative profits over compliance, and see nothing wrong with it. Meddings believes that the United States is meddling when it enforces its sanctions upon foreign banks who transact business in America. He forgets that access of foreign banks, to the financial centers of America, is a privilege, not a right, and it can be revoked for cause.

 If there ultimately is a war between the Western democracies and Iran, banks that facilitated Tehran's sanctioned missile and nuclear weapons programs, solely for profit, should face harsh justice.

Personally, should organizers at any one of the upcoming banking conferences in the United States in 2014-2015 have the temerity to invite Mr. Meddings to speak at their function, they might want to reconsider. I would think that his listing as a speaker will deter bankers from attending, meaning a major loss in revenue.  They should also expect to see some angry protesters there, for Mr. Meddings will find that he is not welcome in the United States.

Thursday, July 17, 2014


Please consider this an alert for unlicensed banking activity, with the operators advertising the services of a Bank that they have designated Bitcoin Bank US. According to Internet postings on Twitter, the solicitation claims that "Bitcoin Bank US", (with superscript indicating that it is a registered trademark*), is available to distribute its debit cards to the public. The "bank" claims that its clients are protected by FDIC insurance and something called cyber-threat insurance, and that it offers a globally-accepted debit card to its clients.

Neither the Florida Division of Financial Regulation, which licenses and regulates state-chartered banks, nor any of the Federal agencies (ICC, FDIC) have any record of issuing a banking license, under the above name. My own exhaustive Internet search cannot find any reference anywhere to

In the State of Florida, Fla. Stat.  § 655.922 prohibits any entity from using the term "bank," unless it has obtained the appropriate license as a financial institution. How do the organizers intend to evade the law ? On June 18 of this year, they formed** a limited liability company; the name:
Note that they deleted a letter from the word, so as not to set off alarms; However, they are using the term 'bank' in their deceptive advertising, and that advertising appears to violate state law.

Please note that the so-called bank's listed address is a post office box in a store in a strip mall in Miami. Govern yourselves accordingly, gentlemen as this seems to be a shell company, recently formed, with no assets, no physical brick-and-mortar location, no website, no track record,  no banking license, and with no regulatory agency overseeing its operation, asking for your money for a debit card.
*I can find no record of an existing trademark.
** The corporation's filing can be found on the Florida Secretary of State search page: