CUSTOMS ISSUES WARRANTS ON INVESTIGATION OF ILLEGAL FUNDS TO IRAQ
U.S. Customs Commissioner Robert Bonner launched execution of 29 search warrants on businesses and individuals in 14 states suspected in operating illegal money-transmitting businesses, money laundering, and transferring funds to Iraq.
Such actions are a violation of the International Emergency Economic Powers Act (IEEPA); the United Nations Participation Act; and Executive Orders 12722 and 12724.
Customs agents, agents from the Internal Revenue Service, the Secret Service, the Immigration and Naturalization Service, and several state and local law enforcement officials took part in the searches. No one was arrested in the raids, Customs said.
“Federal law prohibits the direct or indirect transfer of funds to the government of Iraq or its people,” said Bonner.
The investigation targeted individuals and businesses in Buffalo, New York; Chicago; Louisville, Ky.; Dallas; Detroit; Memphis; Minneapolis; Norfolk, Va.; Erie, Pa.; Portland, Ore.; Lincoln, Neb.; St. Louis, Mo.; Tucson, Ariz.; and Seattle.
According to affidavits filed in support of the search warrants, the individuals and businesses targeted today serve as money transfer agents for Al-Shafei Family Connect Inc., a money transmitting business in Mountlake Terrace, Wash. AFCI is owned and operated by Hussain Al-Shafei, a naturalized U.S. citizen born in Iraq.
During a search of AFCI, Customs agents found that AFCI had not registered as a money services business with the U.S. Treasury Department. Federal law required that money services such as AFCI to register with the department, as of Dec. 31. At the search of AFCI, Customs agents also found files labeled with the names of individual agents around the United States.
Executive Order 12724, signed by President George Bush on Aug. 13, 1990, specifically prohibits any unauthorized “commitment or transfer, direct or indirect, of funds, or other financial or economic resources by any United States person to the government of Iraq or any other person in Iraq.” Additionally, the IEEPA and the Iraqi Sanctions Act provide criminal penalties for willful violations of this prohibition.