Toy Company Co-Owner Sentenced for Money Laundering

The co-owner of Woody Toys Inc., Dan Xin Li, was sentenced on Monday, May 6th to eight months in prison for her role in money laundering for Columbian and Mexican drug traffickers.  She will also receive six months of home detention for her involvement in a scheme that has been dubbed as the Black Market Peso Exchange.  Li, and her husband Jia Hui Zhou, pleaded guilty in September to conspiring around filing currency transaction reports with a bank by structuring deposits as to not raise suspicions. Sentencing for Jia Hui Zhou was delayed until January 6th, 2014.  As a result of their plea deal the couple agreed to forfeit $2 million in proceeds they made from the money laundering scheme.

Between 2005 and 2011, about $3 million generated from drug sales was deposited into the business accounts of Woody Toys, Inc.  The deposits were usually below $10,000 to ensure they wouldn’t have to report the funds to federal authorities.  Woody Toys, Inc. would then purchase merchandise from companies in Columbia and Mexico with the money from these transactions.  According to authorities, this would allow the money to be funneled back to the drug dealers.

Prosecutors referred to Woody Toys as the “last spoke in the wheel, ‘that cleaned illicit proceeds and enabled drug trafficking organizations to convert their dirty dollars into clean pesos”.

The U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, IRS-Criminal Investigation, and the multi-agency Southern California Drug Task Force conducted the investigation.


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