Anatomy of a money laundering operation

The alleged money laundering operations of a convicted international drug trafficker are about to be laid bare, as he defends himself agaiWarren-6225532nst a GBP198m confiscation hearing.

Curtis ‘Cocky’ Warren has spent the last 17 years behind bars in Holland and the UK for drug trafficking. Rumours of his supposed huge fortune, how he amassed it and where is was hidden have been rife since his conviction in 1997. Some believe Warren never wrote anything down – a well known strategy of savvy drug dealers – and had memorised the account numbers hiding his alleged fortune. Sources close to Warren have told the media that the prosecution’s case is has no foundation in truth. Warren cannot repay the £198m demanded by the confiscation hearing at Jersey‘s Royal Court, they say, as the defendant claims the fortune does not exist.

Show me the money

Six years after his arrest in jersey for cannabis trafficking, prosecutors believe they have pieced together the various parts of Warren’s finances and can prove it came from the proceeds of crime. A three week trial will determine whether or not the Crown can confiscate the funds. If the court finds for the prosecution, Warren faces another ten years behind bars if he cannot repay the funds he has allegedly reaped in benefits from trafficking. If the court finds no truth in the prosecutor’s evidence, Warren, 50, could be back home in Liverpool starting early retirement by January 2014.

In his opening statement to the trial, Howard Sharp, QC, Jersey’s Attorney General, made ‘astonishing’ claims about  Warren’s influence:

Taken from the Liverpool Echo:

  • Warren is “truly prolific” – he can source cocaine from South America, heroin from Turkey and Iran, and cannabis from Morocco.

  • His markets are ‘diverse’ and include Liverpool, Brazil, Moscow, Swaziland and Australia.

  • Warren boasted while behind bars in Holland of laundering up to £15m cash each week, obtained from worldwide drug trafficking.

  • Dutch financial investigators in 1996 estimated Warren made a drugs profit of £12m in a three-month period, but those figures failed to take into account multi-million pound heroin and cannabis jobs, or cocaine trafficking.

  • And the same investigation did not consider alleged overseas trade, including deals to sell 3,000 ‘bath interiors’ to Moscow and ‘railways’ to South Africa. Mr Sharp said: “We are not suggesting for a moment they [Warren’s gang] were selling bathroom suites.”

  • Warren was behind 35,000 calls while on remand in prison over the Jersey smuggle to contacts across the world.

Last chance

This is the prosecutor’s last chance to keep Warren behind bars. His first conviction in Holland in 1997 put him away for 12 years, with an extra four added on for manslaughter committed in jail. He was free for five weeks before his arrest in Jersey on a  conspiracy to import cannabis charge. He was found guilty in 2009 and sentenced to 13 years behind bars. As Warren is now the subject of a Serious Crime Prevention Order, he can be released from jail but with several restrictions on his life, such as whether he can have a mobile phone, how many bank accounts he can have and limiting his ability to carry more than £1,000 in cash.

It will be interesting to watch this trial as it progresses and what it reveals about how they believe someone with access to millions in the proceeds of crime can place, layer and integrate their lucre into the financial system.

How do you catch a launderer?

In any network of this nature, the drug trafficker is the top of the tree, and his money launderer is number two in the chain. Prosecutors appear confident that they can prove Warren has laundered a fortune in the proceeds of crime, but can they identify the washer-man behind the scenes who put these schemes together? If our recent analysis of a contemporary launderer is anything to go by, then they probably will not know who was providing the financial advice in this case.

Going back to a story known to Financial Crime Asia readers, the best money launderers have been caught only when the police receive a tip off. A good friend of this blog – Humberto Aguilar – successfully washed cash for Cuban cocaine traffickers for almost a decade without being caught. He was eventually arrested when a footsoldier in the organised crime network gave up Aguilar’s name in return for a lighter sentence. Somehow, I think it unlikely we will find out the alleged launderer’s identity in this case.

Read the full story and updates on the Liverpool Echo.

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