MONEY LAUNDERER ARRESTED IN MASSACHUSETTS CLEANED OVER $20 MILLION THROUGH LOTTERY TICKETS

                                  

Ali Jafaar

Back in the day when, as a practicing money launderer, I was in contact with several Miami drug trafficking organizations, most of whom were clients of mine, one group engaged in laundering their marijuana profits through quiet purchases of winning lottery tickets in Puerto Rico. They were eminently successful in that technique, and the recent major money laundering arrest in Massachusetts, of a laundryman who used that method to clean over twenty million dollars, reminded me of the tradecraft involved.

What my clients did was let the word get out in Puerto Rico that they would pay a premium over the value of any substantial winning lottery tickets, in cash, no questions asked, and then declare themselves the winners, thereby effectively cleaning millions of narco-profits. Yes, of course they would pay all the necessary taxes, because their goal was not to maximize illicit profits, but to legitimize a large portion of it.

Now turn this method on its side. In the Mass. State Lottery case, for a ten percent fee, the laundryman would agree to be the frontman for real winners, redeeming them, and actually filing tax returns on the income, but he would offset that money with bogus and ficticious gambling losses, cancelling out any payment he might have owed. Meanwhile, the real winner got a load of cash that he didn't have to report and pay taxes on to the IRS. It's actually the flip side of the technique.

It is important to know that the authentic winners might have other reasons for not turning in their ticket, besides the tax bite taken out. The IRS can deduct any and all taxes owed from the winner's past tax years, as well as past-due child support, or other delinquent debts owed to Uncle Sam. The laundrymen even went so far as to claim bogus tax refunds, which one does not do if one wishes to avoid being targeted by the Service in a big way. All the participants got prison time; sentences of five years, four years and one month, and six months were meted out to the money launderers involved, who pled to both Filing a False Tax Return and Money Laundering Conspiracy. 

Remember, a good money launderer will always take a method used in the past, stand it on its head, and make it work. In that dark world, you are only limited by your imagination. If your perspective on compliance has finite limits, the laundryman will beat you every day of the week. Do not be afraid to consider alternatives to the usual methods and techniques; your opponents do that constantly. Don't let them winn.