Sunday, August 30, 2009

Morgan case offers more clues for money laundering probes

Morgan case offers more clues for money laundering probes

Posted By Stabroek staff On August 30, 2009 @ 5:17 am In Local News | 7 Comments

Peter Morgan’s imminent sentencing in the US for conspiracy to import drugs offers another lead for local authorities to figure out why they failed to uncover his activities, in the same way that Roger Khan was untouched for many years.

Morgan’s case revealed a pattern of huge currency declarations on arrival in the US –
presumably the proceeds of his drug business. For each declaration in the US, there should have been a corresponding declaration at the Timehri airport. Those declarations in turn should have triggered questions about the nature of his business here and whether it warranted investigation.

Stabroek News has been unable to get any information from the Immigration Department to ascertain whether they have declaration records between December 2001 and August 2003, the period Morgan admitted that he trafficked in narcotics. But even before that time, the confessed drug dealer was declaring large sums of money, as he has admitted in court documents. In entering a guilty plea to charges, Morgan admitted that he and family members may have made over 60 trips to the US carrying large sums of money. He had claimed that the money was to conduct business on behalf of Morgan Auto Sales, his company here.

It is unclear how the Financial Intelligence Unit (FIU), a one man organisation for many years, operated in those years. Contact was made with director Paul Geer but he was overseas at the time and asked that he be contacted some time this week when he would be in Guyana.

The full implementation of the recently assented to Anti-Money Laundering and Countering of Terrorism Act is supposed to boost the powers of the FIU, which would be able to enter into formal and informal information exchange agreements with local and international institutions with similar responsibilities in order to curtail money laundering and related crimes.

The act was passed with the full support of the National Assembly on April 30 after spending almost two years in a Special Select Committee. The government has been heavily criticised for not having such a law in place many years ago. A less severe law was on the books for years but not a single charge was brought under it.

The new law provides for oversight of the export and insurance industries, real estate, and alternative remittance systems, and sets forth the penalties for non-compliance. It also establishes the FIU as an independent body that answers only to the President, and defines in detail its role and powers. The new law is believed to be a significant improvement on previous anti-money laundering legislation and covers, among other things, the freezing and forfeiture of assets owned or controlled by persons suspected of engaging in money laundering activities.
Black market

currency exchange

For his part, as he attempted to mount a defence prior to entering a guilty plea, Morgan claimed that the reason he and his relatives travelled with large sums of foreign currency was because he benefited from favourable exchange rates using Guyana dollars to purchase ForEx which was then used to pay overseas suppliers of his company.

It would have to be believed that for almost 20 years Morgan used market fluctuations to trade for profit in currency, because the unusual economic conditions in Guyana forced most businessmen in this country to pay vendors in other currency. He claimed that his business, which was established in 1991, utilised the New York bank account of Sabena Manufacturing, established by his father, James Morgan at the JP Morgan Chase Bank way back in 1985. Since the establishment of that bank account Morgan and his relatives made over 60 trips to the US carrying large sums of US and Canadian dollars along with British pounds totalling millions of dollars, all of which were declared.

But what Morgan did not say in his explanation was that JP Morgan Chase account was closed by US authorities and the proceeds given to the state as it was the same bank account his sister Sabrina Budhram and her husband, Arnold, admitted to using to launder money for Khan and others. The account was in the name of Morgan’s father, who is currently serving time in the United Kingdom for a drug offence. According to the prosecution in the Budhram matter, the account was used to launder money from drug pushers in Guyana. The Budhrams have pleaded guilty to certain aspects of money laundering and while Arnold has been sentenced to three years’ probation and his wife to one year in prison.

However, Morgan claimed that his business, which he said he built into a profitable enterprise, involved buying, importing and selling previously owned and/or reconditioned automobiles, trucks, machinery, automotive parts and other products. To develop his business, he said he travelled extensively to find vendors and create business relationships and while customers were located in Guyana and paid in Guyana currency his vendors were located in Singapore, England, Japan and China. It was noted that Guyana currency is not accepted outside Guyana and as such he used US, British and Canadian currency when conducting business outside Guyana.

However, the US Government argued that his explanation simply illustrated how drug dealers in Guyana, like those in Colombia, could take advantage of a black market currency exchange to launder drug proceeds with individuals paying Guyanese dollars in Guyana in order to have drug dollars in the United States wired to accounts across the world to pay for legitimate expenditures.

In any event, the US government argued, even if the court was informed that Sabena Manufacturing’s bank account was used to pay vendors for Morgan Auto Sales, which engages in a car business in Guyana, that would have made no difference in the probable cause determination considering that multiple drug couriers specifically identified the residence of the Budhrams as a drop-off point for drug proceeds and toll records showed that their telephone was in contact with identified targets of the narcotics investigation.

Had the case gone to trial, the government was expected to present evidence that would have shown that David and Susan Narine [David is awaiting sentencing in the US for drug trafficking while Susan has been released] hired couriers to carry drugs from Guyana to the Eastern District of New York, which resulted in several seizures at John F. Kennedy airport and numerous arrests. The evidence would have also shown, according to the government, that the Narines received dozens of kilograms of cocaine from Morgan and that the drugs supplied by the defendant were delivered to New York, as well as to Canada and the United Kingdom, and drug proceeds generated in the New York area were delivered to and laundered by the defendant’s sister, Sabrina Budhram.

Morgan was nabbed in March 2007 in Trinidad by Trinidadian and US authorities while he was in-transit at the Piarco Airport. He was extradited to the US on August 23, 2007, after he withdrew a last-ditch appeal he had made in the Port of Spain Appellate Court.

When he pleaded guilty, Morgan told the court that he fully understood what he was doing. When asked to explain what he did, Morgan told the court that between December 2001 and August 2003 he conspired, with David Narine, to get cocaine in and out of Guyana and that he was fully aware of his actions and his conduct. He said agreed with Narine to import cocaine into the US.
7 Comments (Open | Close)

7 Comments To "Morgan case offers more clues for money laundering probes"

#1 Comment By Cummins On August 30, 2009 @ 6:11 am

Stabroeknews, you are doing the work of the Guyana police. But then again I can hear the commissioner saying “bring the evidence” so they can file charges. God knows, Guyana Police Force must be the laziest law enforcement agency in the world; never going out to investigate (suspected) crimes but always wants “ready done work”.

#2 Comment By BORAPORK On August 30, 2009 @ 6:37 am

These people have sullied the reputation of all law abiding Guyanese by making us all drug dealing suspects. I hope his sentence is of very long duration and all his assets in Guyana are seized, based on his admission in a court of law that he was implicated in drug trafficking. There had to be facilitators and they must be exposed and face justice regardless of their positions in the highest chambers of power. Guyana is a lawless country run by a morally corrupt and bankrupt government, fortified in the knowledge that its most ignorant supporters will blindly follow wherever led and do as commanded.

#3 Comment By amenra[jackass seh de wurl na level] On August 30, 2009 @ 7:08 am

He was able to trick the guyana govt, because guyana laws are weak when it come to money laundering, but he couldn’t fool the u.s because they had him on surveilance for years, you do the crime now do the time, now it’s time for guyana to get it’s act right and seize all his assets.

#4 Comment By SWAT On August 30, 2009 @ 8:36 am

It is hard to comprehend why the GY press continues to call individuals engaged in the drug trade “businessmen”. Let us see if the GY government has the intestinal fortitude to enforce the money-laundering laws on the books and seize this guy ill-gotten asset.

#5 Comment By Brandon Samaroo (PPP is now the new and improved PNC Dictatorship) On August 30, 2009 @ 8:48 am

Trick implies that the Guyana govt did not know what was going on.

I beg to differ they absolutely knew what was going on they turned a blind eye. Did they ever stop and frisk morgan on his several trips out of timehri? absolutely not!

#6 Comment By macattack On August 30, 2009 @ 9:02 am

The submission of outgoing Currency Declaration forms falls under the perview of the Customs and Excise Department.This declaration is submitted to the Customs and Excise Officer ,no questions being asked nor verification of the amount of currency being taken out .At the end of the shift all forms are bundled together and placed in a box and periodically sent to Customs House.
This system was abused by businessmen acting in collusion with Customs and Excise officers who facilitated the export of foreign currency by signing and countersigning false declaration forms .
These forms are routinely destroyed after the business man had departed Guyana’s shores with large quantities of foreign currency.
There will be no Currency Declaration forms for Peter Morgan at Customs House.
Note that Peter Morgan sold a number of bush trucks to Customs Officers and was well connected with the officers of the Customs and Excise Department.

#7 Comment By turbo On August 30, 2009 @ 9:59 am

it’s amazing the questions people asks about this ppp govt. when
they fully know that once you are a ppp friend you are untouchable
and free to do what you want in guyana

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