Toy Company Pleads Guilty To Money Laundering For Drug Trafficking Ring
The corporation’s guilty plea is part of a “package deal,” according to the plea agreement filed with the District Court for the Central District of California.
Angel Toy Corp. and its co-owners and co-defendants Ling Yu and Meichun Cheng Huang agreed to forfeit $1 million, “which the parties agree is the appropriate amount of property involved in the defendant’s illegal activity,” according to the plea agreement.
“We are very satisfied,” with the plea agreement, said Assistant U.S. Attorney Sarah Levitt. While the plea agreement specifically deals with money laundering and not the connection to drug trafficking organizations, Levitt noted that, “We are still permitted to present evidence on the illegal source of funds as relevant to the case.”
The original indictment sought more than $8.6 million allegedly laundered from 2005 to 2009.
The indictment outlines a plot in which Colombian and Mexican drug traffickers provided the defendants at Angel Toy Corp. with cash to be deposited in less than $10,000 increments to avoid federal currency reporting requirements. Angel Toy Corp. would then purchase stuffed animals that would be sold in Colombia to reimburse the drug traffickers. The scheme used international trade to launder drug profits, according to U.S. Immigration and Customs Enforcement officials.
Connie Tam was representing Angel Toy Corp. after being appointed its CEO three months ago. She is the only member of the board of directors not to be named in the case indictment, and spoke confidently to Judge S. James Otero through her court-provided Cantonese interpreter.
Co-owners Ling Yu and Meichun Cheng Huang are both co-defendants in the case, and have been charged with conspiracy to evade reporting requirements at domestic financial institutions.
Huang was also in court Friday morning to change her plea to guilty under the negotiated deal. Dressed in neat black slacks and a salmon-colored jacket, Huang seemed nervous in court and said little beyond “yes” and “no” to Judge Otero’s questioning through her Mandarin interpreter.
The visitor’s section of the courtroom was empty except for two young relatives to the defendants.
Of the five defendants in the case, four have now changed their pleas to guilty: Angel Toy Corp.; Meichun Cheng Huang, 57, of Irvine, Calif., a co-owner of Angel Toy Corp.; Ling Yu, 52, of Arcadia, Calif., a co-owner of Angel Toy Corp. and its chief executive officer until three months ago; and Xiaoxin "Judy" Ju, 48, of San Gabriel, the company's accountant.
The fifth defendant, Colombian businessman Jose Leonardo Cuevas Otalora, 50, is in custody in Colombia and is awaiting extradition, according to Levitt.
Judge Otero set the sentencing hearing to October 31, 2011 at 9:00 a.m.
Messages left at Angel Toy Corp. were not returned, although a woman who declined to be identified did say that sales have “not gone down at all” in the months since the indictment before hanging up.
Upon serving the original indictment in July 2010, U.S. Immigration and Custom’s Enforcement Director John Morton noted the contrast between the seemingly innocuous goods being sold by Angel Toy Corp. and its involvement with illicit activities.
"It's no small irony that a multi-million dollar company which promoted itself as retailer of cuddly stuffed animals was allegedly acting as a financial linchpin for drug trafficking operatives in Colombia and Mexico," he said. "It may be a toy company, but we believe these defendants' pursuits were anything but child's play.”