Nightclub Owner Sentenced for Money Laundering and Drug Trafficking

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Nightclub Owner Sentenced for Money Laundering and Drug Trafficking

A Pico Rivera nightclub owner has been sentenced to prison for laundering money as part of a drug-trafficking ring.

Edgar Fragoso Sentenced in Money Laundering and Drug Trafficking Case

According to authorities, Edgar Fragoso, the owner and general manager of El Rodeo nightclub has been arrested for his involvement in a drug-trafficking ring operating throughout the United States and Mexico.

Fragoso admitted to laundering about $235,000 in cash through his nightclub located in Washington Boulevard in Pica Rivera. As part of his plea deal, Fragoso agreed he would surrender the liquor license for the nightclub. The plea deal called for all charges except for one for money laundering to be dismissed.

DEA Raided Nightclub

In 2015 Drug Enforcement Administration agents raided the nightclub in addition to Fragoso’s Hacienda Heights home. An undercover investigation, triggered by the 2012 arrest of two people who were trafficking methamphetamine in Texas, revealed that the nightclub owner had ties to an illegal drug trade.

As part of the drug-trafficking ring, the nightclub was a drop-off point. According to undercover operatives working for the DEA, as much as $150,000 in cash would be handed over at a time. During those undercover operations, Fragoso often openly discussed the various methods he used to launder the illicit funds.

According to a spokesman for the U.S. attorney’s office, Fragoso received a two-year split-sentence of prison and home detention. Additionally, Fragoso will need to pay a $14,000 fine as well as complete a three-year term of supervised release. He posted his bail of $100,000 and was released.

Money Laundering

Money laundering, often referred to as a “white collar crime” is the act by which criminals disguise the original ownership of funds so that it appears to have derived from a legitimate source. Money laundering happens not only within the nation, but quite often throughout various nations, as it is often easy for criminals to transfer funds to off-shore accounts. While there are numerous money-laundering techniques, the Treasury’s initiative hopes to crack down most on shell companies. Shell companies are fake companies that are established to take in money as payment for goods or services that are not actually offered, thus providing a place to “hide” the money that it receives. Fake invoices and balance sheets are a way to make transactions appear valid and legitimate.

Money Laundering and Concealment

According to the International Monetary Fund (IMF), the amount of money laundered every year is estimated to be between $600 billion and $1.5 trillion.

A large aspect of money laundering, and being convicted of money laundering has to do with concealment. For money laundering charges to be brought, a prosecutor must show that the person concealed money specifically in order to conceal the ownership and source of the money, as well as control of the money, as to make it appear as if it came from a legitimate source.

Proving concealment is key. For example, if you make a $10,000 profit from privately selling your car and then try to hide that income from the IRS, you have not committed “money laundering.” Yes, you’ve violated tax laws, but because your sale was legal, money laundering charges cannot be brought.

Penalties for Money Laundering

There are state and federal laws regarding penalties for money laundering. Typically, being convicted of committing money laundering results in fines, prison, probation, or a combination of these penalties.

Prison

While money laundering is typically charged as a felony offense, some states charge it as a misdemeanor. A misdemeanor money laundering conviction can result in a year-long jail sentence. Felony convictions carry penalties of a year or more in prison. In situations where a person is a repeat offender and money laundering was part of an ongoing criminal enterprise, or if money laundering was related to terrorist activities, prison sentences can be 35 years or more.

Fines

The fines associated with a money laundering conviction can be steep. A misdemeanor money laundering conviction can mean fines up to no more than a few thousand dollars. A federal conviction can result in fines of up to $500,000 or double the amount of money that was laundered, whichever is greater.

Probation

A court can also impose a probation sentence for money laundering convictions. This probation usually lasts for at least one year, but sometimes as long as three years or more. During the time someone is on probation he or she will have to meet specific probation conditions, including: regularly reporting to a probation officer, allowing the officer to conduct random home checks, taking random drug tests, and not committing other crimes. Violation of probation can cause a court to revoke probation. If this happens, a person will most likely need to serve a prison term, face additional fines, increased probation period, and/or face other penalties.

Being Charged with a Federal Crime

Being investigated or charged with a crime by a federal agency is a sobering and often intimidating situation. The Federal Government can use an array of powerful investigative tools as well as having access to judicial assistance to build a case against you. Federal prosecutors have the power to create a task force from various law enforcement agencies at all levels – federal, state and local- into a powerful prosecution team. Accordingly, federal prosecuting attorneys have the ability to bring tremendous resources against you, and they will not hesitate to do so.

Federal Crime Definition

Crimes are defined as federal crimes when they either cross state lines, involve a federal agency (e.g., the post office, federally insured banks, the SEC and HUD) or involve the Internet. The most common cases prosecuted at the Federal level include drug trafficking, bank robbery, and Internet pornography, but also white-collar offenses such as mail fraud, wire fraud, bank fraud, and money laundering.

As with any criminal charge, you will want to follow all the legal rules and precautions you can, and the best way you can protect yourself is by working with an experienced defense attorney such as Sevens Legal, APC.

Drug Charges

Drug charges can stem from minor to more serious offenses and at Sevens legal you can find a Criminal Defense Attorney for a number of drug related crimes. Regardless of the drug related crime, choosing Sevens Legal will help with protecting your rights and freedom and lead towards a positive outcome.

Some common drug charges include the following:

  • Simple possession and possession for sale or distribution
  • DUI involving drug possession
  • Heroin manufacturing
  • Money Laundering
  • Cultivation of Marijuana
  • Drug Trafficking or smuggling
  • Juvenile or student drug offenses
  • Unauthorized possession or sale of prescription drugs
  • Drug Possession

Being convicted of any drug crime is a serious matter. Most drug charges can carry heavy convictions, fines and stay on your personal record, which can affect your job, buying a home or getting a loan. If you are convicted for any drug related crime, it is in your best interest to seek a criminal defense attorney and never accept any deal without speaking to an attorney first. Drug charges range from minor possession to a more serious charge of drug manufacturing, whatever the charges are, know that you can find guidance with your case.

Working with Sevens Legal, APC

After you have discussed the specifics of your case, your Sevens Legal, APC, will let you know your case’s strengths and weaknesses, as well as any possible risks associated with punishment and convictions you may face. Your Sevens Legal, APC, defense attorney can help negotiate a plea deal or whether the best course of action is to move forward to trial, while working constantly for your best interests.

Sevens Legal, APC, criminal defense lawyers put our experience to work for you. Every defendant deserves a zealous defense. To schedule your free consultation with one of our Sevens Legal, APC, criminal defense lawyers, call (619) 430-2355. Contact Sevens Legal, APC, today for a free consultation.

Sevens Legal, APC
Criminal Defense Attorneys
3555 4th Ave.
San Diego, CA 92103
Phone: (619) 297-2800

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