When a Mexican drug cartel took a U.S. citizen hostage for a cocaine
debt two years ago, it demanded his family deliver $140,000 in ransom to
QT Maternity, a wholesaler selling pastel tank tops and ruched
swimsuits in downtown Los Angeles.
Federal agents on Wednesday
raided that store and others in the bustling fashion district, seizing
more than $75 million they declared “blood money.”
Calling Los
Angeles the “epicenter” of money laundering for Mexican cartels,
Assistant U.S. Attorney Robert E. Dugdale said some fashion district
merchants accept huge sums of cash stuffed in duffel bags, boxes and
luggage carried into their stores, sometimes by strangers.
Relatives
of the man being held hostage took cash to QT Maternity, according to
indictments unsealed Wednesday, charging that business and two others
with money laundering. The payment secured his release from a ranch in
Culiacán, Sinaloa, where over 62 days he was beaten, shot, electrocuted
and waterboarded.
On Wednesday, some 1,000 officers searched 19 stores, six large warehouses and numerous homes.
Cartels
seek to exchange for pesos the dollars collected from such ransoms and
the sale of cocaine, methamphetamine and heroin in the United States,
officials said.
Under deals arranged by “peso brokers,” fashion
district vendors in return for the cash send their goods to businesses
in Mexico. There, the goods are sold for pesos that are eventually
routed to drug traffickers.
Agents found $10 million in a duffel bag at a Bel-Air mansion and $35 million in bankers boxes in a Los Angeles condo.
“This
is blood money. ...When narcotics proceeds are laundered and funneled
back to the street to drug cartels, it contributes to violence, pain and
bloodshed,” said Claude Arnold, special agent in charge of U.S.
Immigration and Custom Enforcement’s Homeland Security Investigations.
Authorities
arrested nine people, including QT Maternity owner Andrew Jong Hack
Park, 56, of La Cañada-Flintridge and manager Sang Jun Park, 36, of La
Crescenta.
Two other indictments named Yili Underwear and Gayima Underwear and Pacific Eurotex, Corp.
In
two stings tied to Wednesday’s raid, undercover agents delivered
bundles of cash to merchants, some of it wrapped in dryer sheets or
cellophane. One accepted the money, even though some of the bills
appeared to be spattered in blood, officials said.
Not all fashion district merchants deal in large cash transactions, and some said they only accept credit cards and checks.
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