DENVER - A federal grand jury has indicted three people accused of helping launder drug money through a Commerce City auto dealership.
Raul Mendoza, 48, and Julia Castillo-Caraveo, 28, both of Denver, and Isidro Noe Mendoza-Ortiz, 25, of Thornton, were arrested by federal agents Tuesday on charges of money laundering and "structuring" currency -- depositing just under $10,000 during transactions to evade reporting laws, said Jeff Dorschner, spokesman for the U.S. Attorney's Office for Colorado.
All three defendants were named in a sealed indictment returned by a Denver federal grand jury on Feb. 14.
The trio is accused of conspiring to help drug traffickers launder their cash through vehicles sales at Mendoza's dealership, Chopeque Auto Sales.
According to the indictment, over four years Mendoza and Mendoza-Ortiz conspired with each other and others to funnel money through the auto dealership to evade bank deposit reporting laws.
The dealership's daily cash receipts were structured into separate accounts at various banks to avoid the $10,000 reporting requirement. From February 2008 through May 2012, they structured over 700 deposits totaling more than $4.5 million, Dorschner said.
Undercover officers unraveled the drug-money laundering scheme during an investigation that involved agents from the Internal Revenue Service, the Drug Enforcement Administration and the Department of Homeland Security.
As part of the conspiracy, on June 4, 2011, Mendoza, Mendoza-Ortiz and Castillo-Caraveo, knowingly caused Chopeque Auto Sales to fail to file a federal IRS Form 8300, a report required by law for all currency transactions over $10,000, Dorschner said.
In one example, officials said the defendants sold a 2004 Dodge Ram 1500 for $10,500 that undercover officers said were drug trafficking proceeds. Authorities say the defendants' intent was to conceal the illegal source of the money and avoid IRS reporting requirements.
On March 8, 2012, Mendoza and Castillo-Caraveo followed a similar pattern and sold a 2008 Chevrolet Silverado 1500 for $20,900 that undercover officers said was drug trafficking money.
On Tuesday, agents and local police officers executed search warrants at a residence and at Chopeque Auto Sales, where they seized 20 automobiles.
"Working with our federal, state and local law enforcement partners, we were able to uncover a sophisticated scheme where the defendants hid drug dealing proceeds by laundering the money through the sale of automobiles," said U.S. Attorney John Walsh.
"Helping drug dealers launder drug money is unacceptable and illegal. IRS (Criminal Investigation agents) will work with our law enforcement partners to ensure those who do are brought to justice," said Stephen Boyd, special agent in charge for IRS Criminal Investigation's Denver field office.
Mendoza is charged with three counts of structuring and three counts of money laundering. Castillo-Caraveo is charged with two counts of structuring and three counts of money laundering. Mendoza-Ortiz is charged with two counts of structuring and two counts of money laundering.
If convicted, each count of structuring and money laundering carries a maximum penalty of 10 years in federal prison and a $500,000 fine.
If federal prosecutors obtain convictions, the defendants will be forced to forfeit all property or money linked to the criminal enterprise to the government.
The Denver Police Department, Commerce City Police Department, Thornton Police Department, and Colorado Department of Revenue assisted in the execution of the search warrants.