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Indictments Accuse 20|of Money Laundering

(CN) - The former president of a California bank is accused of leading an international money laundering operation that also involved drug trafficking.

A 109-page indictment unsealed Thursday afternoon charges 16 people with racketeering, money laundering and evidence tampering.

They are accused of running a series of schemes centered on lead defendant Tu Chau "Bill" Lu, the former head of Saigon National Bank, which is based in Westminster, Calif.

Lu, 71, and five others allegedly ran a criminal enterprise that involved drug trafficking and international money laundering. They are accused of violating the Racketeer-Influenced and Corrupt Organizations, or RICO, Act.

Lu used his position as head of the bank and insider knowledge to facilitate illegal transactions, according to the indictment. In addition to Lu, the five others charged with RICO violations are Tsung Wen "Peter" Hung, Edward Kim, John Edmundson, Pablo Hernandez and Emilio Herrera.

In 2010, an undercover informant gave cash that he said was drug money to the RICO defendants, who had it converted into cashier's checks, the indictment alleges.

Lu also allegedly helped introduce the informant and the other RICO defendants to Mexico-based Sinaloa drug cartel operatives who wanted to launder millions of dollars per month.

In addition, Lu is accused of proposing that the informant purchase a controlling interest in Saigon National Bank, and putting forth the idea of setting up a money laundering entity in Lichtenstein.

The other defendants charged in the 16-person indictment are: Mina Chau; Ben Ho; Tom Huynh aka "The Fat Guy"; Renaldo Negele; Jack Nguyen; Luis Krueger; Li Jessica Wei; Du Truong "Andrew" Nguyen; Richard Cheung; and Lien Tran.

The 16-defendant indictment claims that members of the racketeering conspiracy laundered a total of $3.7 million.

Two other related indictments were also unsealed Thursday. One charges four people with money laundering and structuring transactions to evade reporting requirements, and another indictment accuses three defendants of money laundering.

The four individuals not named in the 16-person indictment but charged in the related indictments are Jian Sheng Tan, Derrick Cheung, Vivian Lnu and Ruimin Zhao.

In total, 20 defendants are named between the three indictments. Three people are named in two indictments.

Federal authorities arrested 15 defendants Thursday as part of Operation Phantom Bank, according to the U.S. Justice Department. Eleven of those arrested are named in the 16-person indictment, while the other four arrestees are named in the two separate indictments.

Edmundson, Hernandez, Herrera, Negele and Du Nguyen have not yet been apprehended, the government said.

The RICO, money laundering and evidence tampering charges each carry a maximum penalty of 20 years in prison. The charge of structuring transactions to evade requirements has a maximum sentence of five years.


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