Washing Drug Money? Not A Good Plan For Staying Out Of Prison

Suppose an owner of multiple retail perfume stores located on the United States-Mexico border sells perfume – a lot of perfume – to Mexican purchasers. You might think that that’s a nice niche business. Now suppose that a lot of the purchases were for cash – millions of dollars in cash. What would federal prosecutors think? 

They thought that the owner of the stores, Vikram Datta, was laundering drug money. They charged him and brought him to trial, and he was found guilty after a two-week trial of conspiracy charges stemming from his use of his perfume distribution business to launder millions of dollars for a Mexican narcotics organization. And now, Datta has been sentenced to 235 months in prison.
 
The government says that drugs sold in the US generate cash that is smuggled back to Mexico, where the money is aggregated and stored. Mexican money exchange businesses then purchase the cash for Mexican pesos at a steep discount from the prevailing inter-bank exchange rate. According to the government, the exchange businesses later transported the cash back into the US and used it to purchase perfume at businesses, including Datta’s, located in Laredo, Texas, that would then ship the perfume to purchasers in Mexico.
 
In August 2010, Drug Enforcement Administration (“DEA”) undercover agents were introduced to Datta, and they continued to meet and speak with him on numerous occasions until January 2011. During these meetings, prosecutors say, Datta admitted, among other things, that he was receiving “a lot of cash” from his customers on the border and that “it’s all Sinaloa money,” a reference to the Sinaloa Cartel, a major Mexican narcotics trafficking organization. Datta also acknowledged that his business was “just washing the whole money,” prosecutors assert.
 
How big a business was this for Datta? The government says that the DEA’s analysis of financial records revealed that, from January 2009 through January 2011, more than $25 million in US currency was deposited in bank accounts controlled by Datta and his co-conspirators.