Diamond Bar Woman Gets 14-Month Sentence for Money Laundering

A Diamond Bar woman was ordered Monday to serve 14 months for a scheme to aid international drug traffickers launder drug money.
Dan "Daisy" Xin Li 44, who co-owns the City of Industry-based Wood Toys, Inc., will serve eight months in prison, followed by six months of home detention for her role in the scheme dubbed the Black Market Peso Exchange, according to a news release.
Li was taken into custody after the hearing. U.S. District Judge R. Gary Klausner delayed the sentencing for Li's husband, Jia "Gary" Hui Zhou, 44, until Jan. 6, said U.S. Attorney's Office officials.
The couple agreed to forfeit $2 million in proceeds from the reported money laundering scheme, some of which was seized by investigators.  Zhou and Li pleaded guilty in September to conspiring to get around filing currency transaction reports with a bank by structuring their deposits as not to raise suspicions, authorities said.
"The scheme used 'structured' cash deposits in the United States to launder illicit proceeds generated by drug trafficking organizations based in Mexico and Colombia," officials wrote in a news release. "Structured deposits are cash deposits of $10,000 or less that are designed to avoid laws requiring all cash transactions over $10,000 to be reported to federal authorities."
Between 2005 and 2011, around $3 million in out-of-state cash was deposited into Woody Toys' bank accounts, according to court documents. During that time period, Woody Toys took in about the same amount in cash without filling out the required federal paperwork, officials said.
"As part of the Black Market Peso Exchange scheme alleged in this case, foreign toy retailers with Colombian and Mexican pesos would contact currency brokers to buy discounted U.S. dollars, which they used to purchase merchandise from Woody Toys," authorities said. "The dollars being 'sold' were allegedly proceeds from illegal drug sales that had been deposited in the toy company’s accounts or delivered to the business."
The Columbian and Mexican pesos the currency broker received from the foreign toy retailer went to the drug trafficking organizations, officials said.
The Wood Toys investigation began in November 2010 following a similar bust at an Los Angeles company called Angel Toys. After the owners of that company were arrested, several employees went to work for Woody Toys.
U.S. Immigration and Customs Enforcement's Homeland Security Investigations, IRS-Criminal Investigation, and the multi-agency Southern California Drug Task Force did the investigation.
After Woody Toys, Inc pleaded guilty in November to money laundering conspiracy charges involving drug proceeds, a five-year probation sentence was issued in November.
The company is not allowed to receive payments of more than $2,000 in cash and may not get money from anyone who is not a customer, officials said. The owners also must report the identity and contact information of all of its customers and be subject to unannounced audits of the financial records.