http://www.tobacco.org/resources/Documents/021030ecvrjr.html

[Dzono]

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
_________________________________________________
THE EUROPEAN COMMUNITY,
acting on its own behalf and on behalf of the
MEMBER STATES it has power to represent, and the
Kingdom of Belgium, Republic of Finland,
French Republic, Hellenic Republic,
Federal Republic of Germany, Italian Republic,
Grand Duchy of Luxembourg,
Kingdom of the Netherlands,
Portuguese Republic, and
Kingdom of Spain, individually,
Plaintiffs,
- against - COMPLAINT
RJR NABISCO, INC.,
R.J. REYNOLDS TOBACCO COMPANY,
R.J. REYNOLDS TOBACCO INTERNATIONAL, INC.,
RJR ACQUISITION CORP., f/k/a
NABISCO GROUP HOLDINGS CORP.,
RJR NABISCO HOLDINGS CORP.,
R.J. REYNOLDS TOBACCO HOLDINGS, INC.,
DEFENDANTS.
_______________________________________________
Plaintiffs, THE EUROPEAN COMMUNITY, acting on its own behalf and on
behalf of the MEMBER STATES it has power to represent, and the Kingdom of Belgium,
Republic of Finland, French Republic, Hellenic Republic, Federal Republic of Germany, Italian
Republic, Grand Duchy of Luxembourg, Kingdom of the Netherlands, Portuguese Republic, and
Kingdom of Spain, individually, (hereinafter referred to as the "MEMBER STATES" and
together with THE EUROPEAN COMMUNITY, as “PLAINTIFFS”), by and through their
undersigned attorneys, for their complaint herein allege:
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TABLE OF CONTENTS
I. INTRODUCTION...................................... .................................................. .......................... 1
II. PARTIES .................................................. .................................................. .......................... 3
III. JURISDICTION .................................................. .................................................. ............. 10
IV. VENUE .................................................. .................................................. ......................... 11
V. THE LINK BETWEEN RJR’S CIGARETTE SALES, MONEY LAUNDERING, AND
ORGANIZED CRIME .................................................. ................................................ 11
Money-Laundering Links Between Europe, The United States, Russia, and Colombia ... 11
Background on the Convergence of Narcotics Trafficking and Money Laundering ........ 12
Background on Black Market Money Exchanges .................................................. ......... 14
Background on Money Laundering: The Cut-Out Strategy ........................................... 17
VI. THE RACE FOR MARKET SHARE .................................................. .............................. 18
VII. RJR’S DIRECT INVOLVEMENT IN MONEY LAUNDERING..................................... 23
RJR’s Relationships with Money Launderers .................................................. ............... 23
RJR’s Direction and Control of the Money-Laundering Scheme .................................... 26
The Gerardo Cuomo Money-Laundering Organization...................................... ............ 28
The Alfred Bossert Money-Laundering Organization...................................... ............... 31
Money Laundering for Italian Organized Crime............................................. ............... 33
Money Laundering through the Bank of New York.............................................. ........... 36
Walt Money-Laundering Conspiracy .................................................. ........................... 41
Money Laundering through Cut Outs in Ireland and Belgium........................................ 42
Cigarette Sales to Launder Narcotics Proceeds.......................................... ................... 44
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Cocaine Trafficking and Money Laundering in Spain .................................................. .. 45
Money Laundering Through Central America and the Caribbean.................................. 47
Money Laundering through Panama .................................................. ........................... 49
Money Laundering through the United Kingdom .................................................. ......... 50
Distinctions between Sales to Legitimate Customers and Sales to Criminal Customers.. 51
Money-Laundering Mechanisms / Laundering of Cash ................................................. 54
Money Laundering through Brady Bonds .................................................. .................... 55
Money Laundering through Secret Swiss Accounts .................................................. ...... 57
Movement of Operations to Cyprus .................................................. ............................. 58
Illegal Sales into Iraq .................................................. .................................................. 59
RJR and the PKK .................................................. .................................................. ...... 70
Corruption of Public Officials in the Balkans .................................................. .............. 72
Travel and Entertainment by RJR Employees .................................................. .............. 74
RJR’s Efforts to Deceive the Plaintiffs........................................ ................................... 75
RJR’s Responsibility for its Agents, Employees, and Coconspirators ............................. 78
RJR’s Use of Wires and Mails .................................................. ..................................... 79
VIII. IMPACT OF THE MONEY-LAUNDERING SCHEME ON THE US AND THE EC .... 81
IX. CONTINUING DAMAGE TO THE PLAINTIFFS AND COMPELLING NEED FOR
INJUNCTIVE AND EQUITABLE RELIEF .................................................. ............... 85
COUNT I: MEMBER STATES (RICO, 18 U.S.C. § 1962(a)........................................... ...... 102
COUNT II: MEMBER STATES (RICO, 18 U.S.C. § 1962(b) ............................................... 116
COUNT III: MEMBER STATES (RICO, 18 U.S.C. § 1962(c) .............................................. 117
COUNT IV: MEMBER STATES (RICO, 18 U.S.C. § 1962(d)........................................... ... 119
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COUNT V: MEMBER STATES (RICO, 18 U.S.C. §§ 1964(a), 1964(c), 28 U.S.C. § 1651(a)
.................................................. .................................................. ................................ 121
COUNT VI: EC AND MEMBER STATES (COMMON LAW FRAUD) .............................. 123
COUNT VII: EC AND MEMBER STATES (PUBLIC NUISANCE) .................................... 126
COUNT VIII: EC AND MEMBER STATES (UNJUST ENRICHMENT) ............................ 130
COUNT IX: MEMBER STATES (UNJUST ENRICHMENT) .............................................. 132
COUNT X: EC AND MEMBER STATES (NEGLIGENCE)...................................... ........... 133
COUNT XI: EC AND MEMBER STATES (NEGLIGENT MISREPRESENTATION) ........ 137
COUNT XII: MEMBER STATES (COMMON LAW CONVERSION) ................................ 139
COUNT XIII: MEMBER STATES (MONEY HAD AND RECEIVED)................................ 141
DEMAND FOR JUDGMENT .................................................. .............................................. 142
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I. INTRODUCTION
1. For more than a decade, the DEFENDANTS (hereinafter also referred to as the
“RJR DEFENDANTS” or “RJR”) have directed, managed, and controlled money-laundering
operations that extended within and/or directly damaged the Plaintiffs. The RJR
DEFENDANTS have engaged in and facilitated organized crime by laundering the proceeds of
narcotics trafficking and other crimes. As financial institutions worldwide have largely shunned
the banking business of organized crime, narcotics traffickers and others, eager to conceal their
crimes and use the fruits of their crimes, have turned away from traditional banks and relied
upon companies, in particular the DEFENDANTS herein, to launder the proceeds of unlawful
activity.
2. The DEFENDANTS knowingly sell their products to organized crime, arrange
for secret payments from organized crime, and launder such proceeds in the United States or
offshore venues known for bank secrecy. DEFENDANTS have laundered the illegal proceeds of
members of Italian, Russian, and Colombian organized crime through financial institutions in
New York City, including The Bank of New York, Citibank N.A., and Chase Manhattan Bank.
DEFENDANTS have even chosen to do business in Iraq, in violation of U.S. sanctions, in
transactions that financed both the Iraqi regime and terrorist groups.
3. The RJR DEFENDANTS have, at the highest corporate level, determined that
it will be a part of their operating business plan to sell cigarettes to and through criminal
organizations and to accept criminal proceeds in payment for cigarettes by secret and
surreptitious means, which under United States law constitutes money laundering. The officers
and directors of the RJR DEFENDANTS facilitated this overarching money-laundering scheme
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by restructuring the corporate structure of the RJR DEFENDANTS, for example, by establishing
subsidiaries in locations known for bank secrecy such as Switzerland to direct and implement
their money-laundering schemes and to avoid detection by U.S. and European law enforcement.
This overarching scheme to establish a corporate structure and business plan to sell cigarettes to
criminals and to launder criminal proceeds was implemented through many subsidiary schemes
across THE EUROPEAN COMMUNITY. Examples of these subsidiary schemes are described
in this Complaint and include:
(a.) Laundering criminal proceeds received from the Alfred Bossert
money-laundering organization;
(b.) Money Laundering for Italian organized crime;
(c.) Money laundering for Russian organized crime through The Bank of
New York;
(d.) The Walt money-laundering conspiracy;
(e.) Money laundering through cut outs in Ireland and Belgium;
(f.) Laundering of the proceeds of narcotics sales throughout THE
EUROPEAN COMMUNITY by way of cigarette sales to criminals in Spain;
(g.) Laundering criminal proceeds in the United Kingdom;
(h.) Laundering criminal proceeds through cigarette sales via Cyprus; and
(i.) Illegal cigarette sales into Iraq.
Numerous additional subsidiary schemes exist that harm THE EUROPEAN COMMUNITY and
each of the MEMBER STATES named herein.
4. This civil action is based upon violations of the Racketeer Influenced and
Corrupt Organizations Act, which was specifically intended by Congress to eradicate organized
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crime on all fronts (including in foreign and interstate commerce) and to deprive violators of
their ill-gotten gains. It is also based upon violations of standards of common law, including
fraud, negligence, unjust enrichment, public nuisance, and conspiracy to commit such torts.
Plaintiffs seek damages; equitable relief such as disgorgement of profits; and injunctive relief (a)
to enjoin DEFENDANTS from engaging in money laundering and facilitating organized crime,
and (b) to compel DEFENDANTS to adopt necessary programs and procedures to prevent such
conduct in the future. Absent such relief, there will be an increased risk to national security,
continued harm to Plaintiffs, and damage to the vital interests of the United States and Plaintiffs.
II. PARTIES
5. THE EUROPEAN COMMUNITY is a governmental body created as a result
of collaboration among the majority of the nations of Western Europe, more specifically,
Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, The
Netherlands, Portugal, Spain, Sweden, and the United Kingdom. Pursuant to the Treaty
establishing THE EUROPEAN COMMUNITY, as last amended by the Treaty of Amsterdam
(1999), Article 2, THE EUROPEAN COMMUNITY is vested with the responsibility "to
promote throughout the Community a harmonious, balanced and sustainable development of
economic activities, . . . a high level of protection and improvement of the quality of the
environment, the raising of the standard of living and quality of life, and economic and social
cohesion and solidarity among the Member States." THE EUROPEAN COMMUNITY has
certain legal rights and responsibilities. Pursuant to Article 281 of the Treaty establishing THE
EUROPEAN COMMUNITY, THE EUROPEAN COMMUNITY is a legal person. Pursuant to
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Article 282 of the Treaty establishing THE EUROPEAN COMMUNITY, THE EUROPEAN
COMMUNITY possesses the most extensive legal capacity accorded to legal persons under the
laws of the Member States, and it may, in particular, acquire or dispose of property and may be a
party to legal proceedings. In such instances, THE EUROPEAN COMMUNITY is represented
by the European Commission. Pursuant to Article 280 of the Treaty establishing THE
EUROPEAN COMMUNITY, THE EUROPEAN COMMUNITY has the duty to counter fraud
and any other illegal activities affecting the financial interests of THE EUROPEAN
COMMUNITY through measures which shall act as a deterrent and be such as to afford effective
protection in the Member States. THE EUROPEAN COMMUNITY has a duty to protect
against harm to the financial institutions and infrastructure within THE EUROPEAN
COMMUNITY. THE EUROPEAN COMMUNITY possesses additional duties and authorities
that have been conferred upon it by the MEMBER STATES or that it shares with the MEMBER
STATES, by virtue of treaty and/or law, including but not limited to the following: (a) The duty
and authority to regulate foreign commerce; (b) The duty and authority to regulate and set rules
to combat money laundering; (c) The duty and authority to prescribe regulations for the seizure
of bank accounts and assets and to take other related actions to combat money laundering and
other financial crimes committed against the financial interests of THE EUROPEAN
COMMUNITY and the MEMBER STATES; (d) The duty and authority to ensure and regulate
the free movement of goods within THE EUROPEAN COMMUNITY; (e) The duty and
authority to regulate safety and security at sea; (f) The duty and authority to regulate and take
action to protect against breaches of THE EUROPEAN COMMUNITY Customs Territory or
THE EUROPEAN COMMUNITY Customs Border; (g) The duty and authority to regulate
ports, customs territories, free trade zones, and customs bonded warehouses; (h) The duty and
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authority to regulate transportation into THE EUROPEAN COMMUNITY or within its borders;
and (i) The duty to promote throughout the Community a harmonious, balanced, and sustainable
development of economic activities and to protect and promote the economic well being of its
citizens. THE EUROPEAN COMMUNITY has the general duty and the authority to act to abate
any harm to itself or to the general public of THE EUROPEAN COMMUNITY within its areas
of competence as set forth above. Among the legal rights of THE EUROPEAN COMMUNITY
is the right to hold a legal or beneficial interest in property. THE EUROPEAN COMMUNITY
is represented in the United States by a Delegation in Washington, D.C. The Delegation has full
diplomatic privileges and immunities, and the Head of the Delegation is accorded full
ambassadorial status.
6. Each of the named MEMBER STATES, Kingdom of Belgium, Republic of
Finland, French Republic, Hellenic Republic, Federal Republic of Germany, Italian Republic,
Grand Duchy of Luxembourg, Kingdom of the Netherlands, Portuguese Republic, and Kingdom
of Spain, is a sovereign State. As such, each State possesses the legal capacity to acquire, own,
or dispose of property and may be a party to legal proceedings. Each MEMBER STATE is a
“person” as defined under the applicable United States law. Each MEMBER STATE has the
right to hold a legal or beneficial interest in property.
7. Within the areas of their competency and jurisdiction, THE EUROPEAN
COMMUNITY and each of the named MEMBER STATES are the legal entities with the duty
and responsibility for enforcing the money and banking laws within their respective jurisdictions.
If any entities, including the RJR DEFENDANTS, launder criminal proceeds or commit other
illegal acts that violate the money and/or banking laws of the PLAINTIFFS, it is these
PLAINTIFFS with the duty and competency to enjoin and obtain redress for such conduct.
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8. RJR NABISCO, INC. was a Delaware corporation and, according to public
records, maintained its principal place of business at 1301 Avenue of the Americas, New York,
New York 10019-6013. During relevant times, RJR NABISCO, INC. was the parent corporation
of R.J. REYNOLDS TOBACCO COMPANY and has participated in the sale and manufacture
of cigarettes and other tobacco products both individually and through its agent and
instrumentality, DEFENDANT R.J. REYNOLDS TOBACCO COMPANY, and related entities
and ventures. At all relevant times, RJR NABISCO, INC. assumed an active role in the tobacco
business and treated the tobacco business as a department or division of RJR NABISCO, INC.
At times pertinent to this complaint, RJR NABISCO, INC., individually and through its agents,
subsidiaries, divisions, or affiliated companies, or ventures, materially participated in the
operation and management of RJR's money-laundering enterprise, and materially participated,
conspired, assisted, encouraged, and otherwise aided and abetted one or more of the other
DEFENDANTS in the unlawful and fraudulent conduct alleged herein, all of which has affected
foreign and interstate commerce. Upon information and belief, based on RJR’s public filings,
RJR NABISCO, INC., was renamed R.J. REYNOLDS TOBACCO HOLDINGS, INC., a
Delaware corporation, and is now a direct, wholly-owned subsidiary of RJR ACQUISITION
CORP., f/k/a NABISCO GROUP HOLDINGS CORP. During relevant times herein, RJR
NABISCO, INC., has conducted continuous and systematic business in the State of New York,
maintains a substantial financial presence in the State of New York, utilizes offices of its own
and of its affiliated corporations in New York, and is otherwise subject to the jurisdiction of the
courts in the State of New York.
9. R.J. REYNOLDS TOBACCO COMPANY is a New Jersey corporation whose
principal place of business is located at 401 North Main Street, Winston-Salem, North Carolina
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27102. At times pertinent to this complaint, R.J. REYNOLDS TOBACCO COMPANY,
individually and through its agents, subsidiaries, divisions, or affiliated companies or ventures,
materially participated in the operation and management of RJR's money-laundering enterprise,
and materially participated, conspired, assisted, encouraged, and otherwise aided and abetted one
or more of the other DEFENDANTS in the unlawful and fraudulent conduct alleged herein, all
of which has affected foreign and interstate commerce. During relevant times herein, R.J.
REYNOLDS TOBACCO COMPANY conducted continuous and systematic business in the
State of New York, maintains a substantial financial presence in the State of New York, utilizes
offices of its own and of its affiliated corporations in New York, and is otherwise subject to the
jurisdiction of the courts in the State of New York.
10. R.J. REYNOLDS TOBACCO INTERNATIONAL, INC. is a Delaware
corporation. At times pertinent to this complaint, R.J. REYNOLDS TOBACCO
INTERNATIONAL, INC., individually and through its agents, subsidiaries, divisions, or
affiliated companies or ventures, materially participated in the operation and management of
RJR's money-laundering enterprise, and materially participated, conspired, assisted, encouraged,
and otherwise aided and abetted one or more of the other DEFENDANTS in the unlawful and
fraudulent conduct alleged herein, all of which has affected foreign and interstate commerce.
During all relevant times, R.J. REYNOLDS TOBACCO INTERNATIONAL, INC. conducted
continuous and systematic business in the State of New York, maintained a substantial financial
presence in the State of New York, utilized offices of its own and of its affiliated corporations in
New York, and is otherwise subject to the jurisdiction of the courts in the State of New York.
11. RJR NABISCO HOLDINGS CORP. is a Delaware corporation whose
principal place of business is 1301 Avenue of the Americas, New York, New York 10019-6013.
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During all relevant times, RJR NABISCO HOLDINGS CORP. was the parent corporation of
RJR NABISCO, INC. On June 14, 1999, RJR NABISCO HOLDINGS CORP. changed its name
to NABISCO GROUP HOLDINGS CORP. In 2001, NABISCO GROUP HOLDINGS CORP.
changed its name to RJR ACQUISITION CORP. RJR ACQUISITION CORP., f/k/a NABISCO
GROUP HOLDINGS CORP. is a Delaware corporation whose principal place of business is 7
Campus Drive, Parsippany, New Jersey 07054-0311.
12. On June 14, 1999, RJR NABISCO HOLDINGS CORP. distributed all of the
common stock of its subsidiary, R.J. REYNOLDS TOBACCO HOLDINGS, INC., to the
shareholders of RJR NABISCO HOLDINGS CORP.
13. During all relevant times, the holding corporations, identified above in
paragraphs 11 and 12, participated, directly and indirectly, in the sale and manufacture of
cigarettes and other tobacco products through their agent and instrumentality DEFENDANT,
R.J. REYNOLDS TOBACCO COMPANY, and related entities and ventures. These holding
corporations assumed an active role in the tobacco business, and at relevant times have treated
the tobacco business as a department or division. At times pertinent to this complaint, these
holding corporations, individually and through their agents, subsidiaries, divisions, or affiliated
companies or ventures, materially participated in the operation and management of RJR's
money-laundering enterprise, and materially participated, conspired, assisted, encouraged, and
otherwise aided and abetted one or more of the other DEFENDANTS in the unlawful and
fraudulent conduct alleged herein, all of which has affected foreign and interstate commerce.
During relevant times herein, the holding corporations, identified above in paragraphs 12 and 13,
conducted continuous and systematic business in the State of New York, maintained a substantial
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financial presence of their own and their affiliated corporations in New York, and are otherwise
subject to the jurisdiction of the courts in the State of New York.
14. The RJR DEFENDANTS are and were, during all relevant times, involved in
directing, managing, and controlling money-laundering operations that extended within and/or
directly damaged the PLAINTIFFS. At all times pertinent to this complaint, the RJR
DEFENDANTS, individually and through their employees, agents, joint venturers,
coconspirators, subsidiaries, divisions, or affiliated companies, actively directed, managed, and
controlled the RJR money-laundering enterprise, and actively participated, conspired, assisted,
encouraged, and otherwise aided and abetted one or more of their coconspirators in the unlawful
and fraudulent conduct alleged herein, all of which has affected and continues to affect foreign
and interstate commerce in the United States.
15. The foregoing RJR corporations, as well as their affiliated entities, ventures,
and successors, are and were, during all relevant times, affiliated, consolidated, combined, and
unitary entities for purposes of tobacco operations and related activities. Tobacco operations
were departments within the RJR corporate family. The RJR DEFENDANTS maintain control
of tobacco operations worldwide through a web of affiliated entities and joint ventures. This
corporate structure was an essential aspect of RJR’s successful efforts to launder the proceeds of
criminal activity to the detriment of the PLAINTIFFS.
16. The RJR DEFENDANTS are and were, during all relevant times, responsible
for the acts and omissions of their employees, for acts undertaken within the general area of their
authority and for the benefit of the RJR DEFENDANTS. As alleged herein, the RJR
DEFENDANTS were central figures in the overall conspiracy that actively embarked on and
extensively participated in the fraudulent scheme. By means of corporate policies that put RJR
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DEFENDANTS' resources and strategy at the heart of the conspiracy, the RJR DEFENDANTS
were aggressor entities that acted to harm the economic interests of the Plaintiffs.
17. The RJR DEFENDANTS, during relevant times, have adopted a "worldwide"
policy that purports to exercise control of the activities of their employees, as well as those of
their direct and indirect subsidiaries. Under this policy, which is said to be monitored and
enforced by RJR’s Audit Committee, RJR DEFENDANTS have undertaken responsibility for
the acts of the employees of the RJR DEFENDANTS, wherever taken, including acts related to
money-laundering activities within Europe and elsewhere which materially injured THE
EUROPEAN COMMUNITY and its MEMBER STATES.
III. JURISDICTION
18. As to the Plaintiffs, the MEMBER STATES, jurisdiction is proper in this
Court pursuant to 28 U.S.C. §§ 1331, 1337 because this matter involves allegations of illegal
behavior arising under the laws of the United States, including violations of RICO. Furthermore,
jurisdiction in this Court is proper pursuant to RICO, 18 U.S.C. §§ 1964(a),(c) and 28 U.S.C. §
1651(a). The DEFENDANTS are “persons” within the meaning of 18 U.S.C. § 1961(3). As to
all Plaintiffs, jurisdiction is proper in this Court pursuant to 28 U.S.C. § 1332 because the matter
in controversy exceeds the sum or value of $75,000 and involves parties of diverse citizenship.
The Plaintiffs are “persons” within the meaning of 18 U.S.C. § 1961(3). Finally, this Court may
exercise jurisdiction over Plaintiffs’ non-federal claims pursuant to 28 U.S.C. § 1367, as this
Court possesses both federal question and diversity jurisdiction.
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IV. VENUE
19. Venue is proper in this Court pursuant to 18 U.S.C. § 1965(a) because
DEFENDANTS reside, are found, have an agent, or transact affairs in this District. Venue is
also proper in this Court pursuant to 18 U.S.C. § 1965(b) because, to the extent any
DEFENDANT may reside outside of this district, the ends of justice require such DEFENDANT
or DEFENDANTS to be brought before the Court. Venue properly lies in this Court pursuant to
28 U.S.C. § 1391(b)(2) or, alternatively, pursuant to 28 U.S.C. § 1391(a)(2). Further, certain of
the conspiratorial acts alleged herein took place within this judicial district.
V. THE LINK BETWEEN RJR’S CIGARETTE SALES, MONEY LAUNDERING,
AND ORGANIZED CRIME
Money-Laundering Links Between Europe, The United States, Russia, and Colombia
20. Cigarette sales, money laundering, and organized crime are linked and interact
on a global basis. According to Jimmy Gurule, Undersecretary for Treasury Enforcement:
“Money laundering takes place on a global scale and the Black Market Peso Exchange System,
though based in the Western Hemisphere, affects business around the world. US law
enforcement has detected BMPE-related transactions occurring throughout the United States,
Europe, and Asia.”
21. The primary source of cocaine within THE EUROPEAN COMMUNITY is
Colombia. Large volumes of cocaine are transported from Colombia into THE EUROPEAN
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COMMUNITY and then sold illegally within THE EUROPEAN COMMUNITY and the
MEMBER STATES. The proceeds of these illegal sales must be laundered in order to be
useable by narcotics traffickers. Throughout the 1990s and continuing to the present day, a
primary means by which these cocaine proceeds are laundered is through the purchase and sale
of cigarettes, including those manufactured by the RJR DEFENDANTS. Cocaine sales in THE
EUROPEAN COMMUNITY are facilitated through money-laundering operations in Colombia,
Panama, Switzerland, and elsewhere which utilize RJR cigarettes as the money-laundering
vehicle.
22. In a similar way, the primary source of heroin within THE EUROPEAN
COMMUNITY is the Middle East and, in particular, Afghanistan, with the majority of said
heroin being sold by Russian organized crime, Middle Eastern criminal organizations, and
terrorist groups based in the Middle East. Heroin sales in THE EUROPEAN COMMUNITY
and the MEMBER STATES are facilitated and expedited by the purchase and sale of the
DEFENDANTS’ cigarettes in money-laundering operations that begin in THE EUROPEAN
COMMUNITY and the MEMBER STATES, Eastern Europe, and/or Russia, but which
ultimately result in the proceeds of those money-laundering activities being deposited into the
coffers of the RJR DEFENDANTS in the United States.
Background on the Convergence of Narcotics Trafficking and Money Laundering
23. This complaint is about Trade and Commerce or, more correctly, illegal Trade
and illegal Commerce, and how money laundering facilitates the financing and movement of
goods internationally. Merchants engaging in global trade often turn to the more stable global
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currencies for payments of goods and services purchased abroad. In many markets, the United
States dollar is the currency of choice and, in some cases, the United States dollar is the only
accepted form of payment. Merchants seeking dollars usually obtain them in a variety of ways,
including the following three methods. Traditional merchants go to a local financial institution
that can underwrite credit. Private financing is usually available for those with collateral. A
third and least desirable source of dollar financing can be found in the “black markets” of the
world. Black Markets are the underground or parallel financial economies that exist in every
country. Criminals and their organizations control these underground economies, which
generally operate through “money brokers.” These “money brokers” often fulfill a variety of
roles not the least of which is an important intermediate step in the laundering process, one that
we will refer to throughout this complaint as the “cut out.” (See paragraphs 32-35 below.)
24. The criminal activity that provides the dollars for these black market money-laundering
operations is often drug trafficking and related violent crimes. South America is the
world leader in the production of cocaine, and the United States and the European Union are the
world’s largest cocaine markets. Likewise, Colombia and countries in the Middle East produce
heroin. Cocaine and heroin are smuggled to the United States and Europe, and are sold for
United States dollars as well as in local European currencies (and now the Euro). Russian drug
smugglers obtain heroin from the Middle East and cocaine from South America, and sell both
drugs in large quantities in the United States and in Europe. Retail street sales of cocaine and
heroin have risen dramatically over the past two decades throughout the United States and
Europe. Consequently, drug traffickers routinely accumulate vast amounts of illegally obtained
cash in the form of United States dollars in the United States and Euros in Europe. The U.S.
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Customs Service estimates that illegal drug sales in the United States alone generate an estimated
fifty-seven billion dollars in annual revenues, most of it in cash.
25. A drug trafficker must be able to access his profits, to pay expenses for the
ongoing operation, and to share in the profits; and he must be able to do this in a manner that
seemingly legitimizes the origins of his wealth, so as to ward off oversight and investigation that
could result in his arrest and imprisonment and the seizure of his monies. The process of
achieving these goals is the money-laundering cycle.
26. The purpose of the money-laundering cycle is to establish total anonymity for
the participants, by passing the cash drug proceeds through the financial markets in a way that
conceals or disguises the illegal nature, source, ownership, and/or control of the money.
Background on Black Market Money Exchanges
27. Within Europe, the United States, South America, and elsewhere, a
community of illegal currency exchange brokers, known to law-enforcement officials as “money
brokers,” operates outside the established banking system and facilitates the exchange of
narcotics sale proceeds for local cash or negotiable instruments. Many of these money brokers
have developed methods to bypass the banking systems and thereby avoid the scrutiny of
regulatory authorities. These money exchanges have different names depending on where they
are located, but they all operate in a similar fashion.
28. A typical “money-broker” system works this way: In a sale of Colombian
cocaine in THE EUROPEAN COMMUNITY, the drug cartel exports narcotics to the MEMBER
STATES where they are sold for Euros. In Colombia, the cartel contacts the money broker and
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negotiates a contract, in which the money broker agrees to exchange pesos he controls in
Colombia for Euros that the cartel controls in Europe. The money broker pays the cartel the
agreed-upon sum in pesos. The cartel contacts its cell (group) in the European Union and
instructs the cell to deliver the agreed-upon amount of Euros to the money broker’s European
agent. The money broker must now launder the Euros he has accumulated in the European
Union. He may also need to convert the Euros into U.S. dollars because his customers may need
U.S. dollars to pay companies such as RJR for their products.
29. The money broker uses his European contacts to place the monies he
purchased from the cartel into the European banking system or into a business willing to accept
these proceeds (a process described in more detail below). The money broker now has a pool of
narcotics-derived funds in Europe to sell to importers and others. In many instances, the
narcotics trafficker who sold the drugs in THE EUROPEAN COMMUNITY is also the importer
who purchased the cigarettes. Importers buy these monies from the money brokers at a
substantial discount off the “official” exchange rates and use these monies to pay for shipments
of items (such as cigarettes), which the importers have ordered from United States companies
and/or their authorized European representatives, or “cut outs.” The money broker uses his
European contacts to send the monies to whomever the importer has specified. Often these
customers utilize such monies to purchase the DEFENDANTS’ cigarettes in bulk and, in many
instances, the money brokers have been directed to pay the RJR DEFENDANTS directly for the
cigarettes purchased. The money broker makes such payments using a variety of methods,
including his accounts in European financial institutions. The purchased goods are shipped to
their destinations. The importer takes possession of his goods. The money broker uses the funds
derived from the importer to continue the laundering cycle.
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30. In that fashion, the drug trafficker has converted his drug proceeds (which he
could not previously use because they were in Euros) to local currency that he can use in his
homeland as profit and to fund his operations; the European importer has obtained the necessary
funds from the black market money broker to purchase products that he might not otherwise
have been able to finance (due to lack of credit, collateral, or U.S. dollars, and/or a desire for
secrecy); the company selling cigarettes to the importer has received payment on delivered
product in its currency of choice regardless of the source of the funds; and the money broker has
made a profit charging both the cartel and the importer for his services. This cycle continues
until the criminals involved are arrested and a new cycle begins. Money laundering is a series of
such events, all connected and never stopping until at least one link in the chain of events is
broken.
31. Many narcotics traffickers who sell drugs in THE EUROPEAN
COMMUNITY now also purchase and import cigarettes. In particular, as the trade in cigarettes
becomes more profitable and carries lesser criminal penalties compared to narcotics trafficking,
the “business end” of selling the cigarettes has become at least as attractive and important to the
criminal as the narcotics trafficking. Finally, it makes no difference whatsoever to the money-laundering
system whether the goods are imported and distributed legally or illegally.
Regardless of whether he sells his cigarettes legally or illegally, the narcotics trafficker has
achieved his goal in that he has been able to disguise the nature, location, true source, ownership,
and/or control of his narcotics proceeds. At the same time, the cigarette manufacturer (in this
case RJR) has achieved its goal because it has successfully sold its product in a highly profitable
way.
17
Background on Money Laundering: The “Cut-Out” Strategy
32. There are numerous important steps in any money laundering cycle. “Dirty”
money of necessity moves in a way that is specifically designed to conceal or disguise its nature,
source, ownership, and/or control. Successful “layering” of “dirty” transactions will often
involve intermediaries, like money brokers, as a matter of necessity and convenience. These
“money brokers” play an important role in the laundering conspiracy. They serve to isolate
relevant coconspirators from the overt criminal acts, and because of that they are often referred
to by law-enforcement agencies as “cut outs.” The “cut out” is purposefully inserted into the
transaction to create a layer of activity between the overt criminal actors and those receiving the
laundered proceeds or profits of the criminal scheme. The “cut out’s” role is to shield the true
participants in the conspiracy from discovery.
33. In this money-laundering conspiracy, the RJR DEFENDANTS’ role will
often be masked by the activities of the “cut outs.” Consequently, the “cut-out” strategy will be
referred to often throughout this complaint. The “cut-out” strategy is also relevant to the sales
and marketing end of the international cigarette export cycle. When a cigarette manufacturer
intentionally sells its products into criminal distribution channels via carefully selected
wholesalers, so that it can deny responsibility for “where the customer sells the product,” the
manufacturer is using that wholesaler as a “cut out” to insulate itself from the overt acts involved
in the sale of cigarettes as a means of supporting the money-laundering cycle.
34. The cut-out strategy works for the benefit of the manufacturers looking to
increase market share and for those merchants looking to conceal their involvement in legal or
illegal business activity. Overall, this process develops into the creation of an unfair business
18
strategy for the manufacturer that increases its market share by creating a competitive
disadvantage. By operating outside the legal framework for fair business operations, the
manufacturer creates an unfair advantage for itself as against its competitors in virtually all
aspects of business activity, including profit margins, financing terms, price structures, shipping,
storage, advertising, regulation (e.g., in the case of cigarettes, health warnings), reporting
obligations, and other aspects of business strategy. The resulting “competitive disadvantage” is
particularly onerous to domestic companies that must comply with an array of regulations
ranging from the sourcing of raw materials to laws governing treatment of their employees.
Consequently, domestic manufacturers in THE EUROPEAN COMMUNITY (both state owned
and privately owned) are particularly harmed by the cut-out strategy.
35. As will become clear from the RJR DEFENDANTS’ use of Weitnauer
Trading Company Ltd. (hereinafter referred to as “Weitnauer”), Michael Haenggi, Copaco,
Alfred Bossert, and many others, the “cut out” was an integral part of the RJR DEFENDANTS’
direction of and participation in this international money-laundering conspiracy.
VI. THE RACE FOR MARKET SHARE
36. RJR has been aware of organized crime’s involvement in the distribution of
its products since at least the 1970’s. On January 4, 1978, the Tobacco Institute’s Committee of
Counsel met at the offices of Philip Morris in New York City. The Committee of Counsel was
the high tribunal that set the tobacco industry’s legal, political, and public relations strategy for
more than three decades. The January 4, 1978, meeting was called to discuss, among other
things, published reports concerning organized crime’s involvement in the tobacco trade and the
19
tobacco industry’s complicity therein. The published reports detailed the role of organized crime
in the tobacco trade (including the Colombo crime family in New York), and the illegal trade at
the Canadian border and elsewhere. RJR’s general counsel, Max Crohn, attended and
participated in the meeting. All of the large cigarette manufacturers were present at the meeting
and represented by counsel, such as Philip Morris (Arnold & Porter, Abe Krash), and Brown &
Williamson (Paul Weiss Rifkind Wharton & Garrison, Martin London). The Committee of
Counsel took no action to address, investigate, or end the role of organized crime in the tobacco
business. Instead, the Committee agreed to formulate a joint plan of action to protect the
industry from scrutiny of the U.S. Congress. Notice and the agenda for the meeting, and the
minutes of the meeting, were transmitted by the use of the U.S. mails.
37. Throughout the 1990s and continuing to the present day, the RJR
DEFENDANTS have undertaken extensive efforts to increase their market share and to expand
the sales of their products throughout the world.
38. To accomplish this end, the RJR DEFENDANTS have actively engaged in the
sale of their products to criminals and/or criminal organizations, which can purchase goods with
their criminal proceeds only if the payments for those goods are made covertly so as to avoid
detection by law enforcement. The RJR DEFENDANTS engaged in such conduct through
illegal acts, including money laundering, wire fraud, mail fraud, and other violations of United
States law. The RJR DEFENDANTS have controlled, directed, encouraged, supported, and
facilitated the activities of the criminals who purchase their products. The RJR DEFENDANTS
have collaborated with criminals, directly and indirectly, and have sold cigarettes to persons and
entities that they know or had reason to know were laundering criminal proceeds through the
purchase of cigarettes.
20
39. By engaging in this illegal conduct the RJR DEFENDANTS have achieved
multiple benefits for themselves, including but not limited to the following:
(a.) The RJR DEFENDANTS have increased their cigarette sales because
they have new and additional customers, namely, the money-launderers and the criminal
organizations they service.
(b.) The RJR DEFENDANTS have increased their profit margins because
they require the criminals to pay a premium for their cigarettes and/or subject the criminals to
sales and credit terms that are more favorable to the RJR DEFENDANTS than those granted to
legitimate customers.
(c.) The RJR DEFENDANTS have increased their market share by adding
to their customer base to the detriment of their competitors.
(d.) The RJR DEFENDANTS have enhanced the market value of their
tobacco operations, while decreasing the market value of their competitors’ operations.
40. The RJR DEFENDANTS, jointly and as individual corporations, control,
direct, encourage, support, promote, and facilitate the criminal activities that harm THE
EUROPEAN COMMUNITY in a variety of ways, including but not limited to the following:
(a.) The RJR DEFENDANTS developed mechanisms and procedures,
including the use of cut outs, to allow their criminal customers to pay them for cigarettes in ways
that could not be detected by U.S. and European law enforcement. In most instances, the RJR
DEFENDANTS mandate that their criminal clients utilize these procedures to ensure that t

40. The RJR DEFENDANTS, jointly and as individual corporations, control,
direct, encourage, support, promote, and facilitate the criminal activities that harm THE
EUROPEAN COMMUNITY in a variety of ways, including but not limited to the following:
(a.) The RJR DEFENDANTS developed mechanisms and procedures,
including the use of cut outs, to allow their criminal customers to pay them for cigarettes in ways
that could not be detected by U.S. and European law enforcement. In most instances, the RJR
DEFENDANTS mandate that their criminal clients utilize these procedures to ensure that the
RJR DEFENDANTS’ role in these money-laundering activities will remain undetected.
21
(b.) The RJR DEFENDANTS accept payments from persons or entities
they know, or have reason to know, are criminals and money launderers, and/or from distributors
that they know, or have reason to know, are selling cigarettes to criminals and money launderers.
(c.) The RJR DEFENDANTS make arrangements by which the cigarettes
they sell can be paid for in such a way that the payments are virtually untraceable.
(d.) The RJR DEFENDANTS make arrangements for payments for their
cigarettes to be made into foreign accounts, including accounts held by Swiss corporations
and/or Swiss bank accounts, in an attempt to improperly utilize Swiss banking and privacy laws
as a shield to protect the criminals from government investigations concerning their activities.
(e.) The RJR DEFENDANTS agree to receive payment for cigarettes by
way of third-party checks and other forms of payment executed by persons who have no
relationship to the transaction other than that they have provided the funds. Such persons are a
common part of money-laundering schemes. Payments for cigarettes by such third-party persons
are a clear indication of money-laundering activity.
(f.) The RJR DEFENDANTS established protocols for “layered
transactions” that allowed for payment for cigarettes to be made through multiple intermediaries
(cut outs) to conceal the ultimate source and nature of the illicit funds.
(g.) The RJR DEFENDANTS invoiced distributors and intermediaries (cut
outs) for cigarettes that were sold to criminal customers to conceal the fact that these sales were
being made to criminals. In fact, however, the intermediaries and distributors were never
expected to pay for the invoiced cigarettes and, at most, would act as pass-through accounts by
which the criminals paid the RJR DEFENDANTS for cigarettes.
22
(h.) The RJR DEFENDANTS generate false or misleading invoices, bills
of lading, shipping documents, and other documents that expedite the process by which the
cigarettes are secretly delivered to criminals.
(i.) The RJR DEFENDANTS approve their criminal customers on an
expedited basis and do not require them to go through the formalities required of legitimate
customers.
(j.) The RJR DEFENDANTS engage in a pattern of activity by which they
ship cigarettes designated for one port knowing that, in fact, the cigarettes will be diverted to
another port to be sold illegally and/or in violation of United States laws and embargoes.
(k.) The RJR DEFENDANTS have formed, financed, and directed the
activities of industry groups to disseminate false and misleading information to Plaintiffs and the
public to conceal their illegal activities.
(l.) The RJR DEFENDANTS controlled, directed, encouraged, supported,
and facilitated cigarette sales to criminals by giving instructions to distributors, shippers,
shipping companies, retailers, and/or various other intermediaries so as to effectuate the sale of
large amounts of cigarettes by criminal organizations.
41. But for the involvement and active assistance of the RJR DEFENDANTS,
money launderers and criminals could not have laundered the proceeds of their criminal
activities and continued such activities at such levels to the detriment of THE EUROPEAN
COMMUNITY and the MEMBER STATES.
42. The members of this vertical group, consisting of the DEFENDANTS, the
distributors, the shippers, the criminal customers, currency brokers, and the RJR
DEFENDANTS’ agents and subsidiaries who receive payment for the cigarettes, work together
23
for the common purpose of depriving Plaintiffs of money and property and engaging in a course
of conduct to gain massive profits from the sale of cigarettes as a part of a global money-laundering
enterprise while harming Plaintiffs’ economic interests. The activities of this core
group constitute a conspiracy in law and in fact.
VII. RJR’S DIRECT INVOLVEMENT IN MONEY LAUNDERING
43. The RJR DEFENDANTS have been actively involved in money laundering
for many years, and have carried out their scheme through acts within this District and
throughout this State. Examples of the methods and means by which the RJR DEFENDANTS
have been complicit in the money-laundering scheme, directly and through the acts of their
coconspirators, are set forth below.
RJR’s Relationships with Money Launderers
44. The RJR DEFENDANTS solicited contacts with companies and individuals in
Europe, Central America, and the Caribbean that the DEFENDANTS knew, or had reason to
know, were money launderers. Large parts of RJR’s illegal activities were conducted through a
branch of RJR called North American Duty Free (NADF). Richard LaRocca was vice president-general
manager for North America Duty Free. He had been recruited by the RJR
DEFENDANTS because of his special knowledge of the Spanish cigarette market. Richard
LaRocca knew and worked directly with Michael Haenggi who was a major customer of RJR
and a central figure in a massive cigarette sales/money-laundering scheme. In 1997, Michael
24
Haenggi freely admitted to the New York Times that he sold RJR cigarettes in bulk to known
criminals. In spite of this public announcement, the RJR DEFENDANTS made a corporate
decision to continue selling huge volumes of cigarettes to Michael Haenggi even though they
were on notice that payments from Haenggi would include the proceeds of criminal activity.
45. In light of the dramatic increase of narcotics sales in THE EUROPEAN
COMMUNITY over the last two decades, narcotics traffickers and money launderers in THE
EUROPEAN COMMUNITY increasingly needed to launder enormous volumes of cash and/or
convert their cash from one form of currency to another. The RJR DEFENDANTS wished to
increase their market share in certain target markets in THE EUROPEAN COMMUNITY by
obtaining additional customers for their product on whom they could rely to sell the cigarettes in
the markets targeted by the DEFENDANTS. In general, it was immaterial to the RJR
DEFENDANTS whether the cigarettes were sold legally or illegally, so long as the cigarettes
were sold in the target markets. Accordingly, the RJR DEFENDANTS reached an agreement
with their coconspirators, the narcotics traffickers and money launderers, that the
DEFENDANTS would provide these criminals with the capability to launder the proceeds of
their criminal activities, including narcotics trafficking, by purchasing the DEFENDANTS’
tobacco products. The RJR DEFENDANTS arranged for secret delivery of the cigarettes and
secret means by which the coconspirators could pay for the cigarettes, an essential component of
the money-laundering scheme. In return, the narcotics traffickers and money-launderers agreed
to sell the products in the markets targeted by the RJR DEFENDANTS and sold the cigarettes
under the instructions of the RJR DEFENDANTS. In this way, the proceeds of enormous
amounts of Colombian cocaine money and Russian heroin money derived from narcotics sales in
25
the United States and THE EUROPEAN COMMUNITY, as well as the proceeds of other
crimes, were laundered through the purchase and sale of the RJR DEFENDANTS’ products.
46. The RJR DEFENDANTS had a well-established relationship with distributors
in Switzerland, Panama, the Caribbean, Eastern Europe, and elsewhere who were well situated to
develop and exploit relationships with criminal individuals and organizations. The RJR
DEFENDANTS directly and indirectly encouraged their distributors to solicit and/or expand
their relationships with customers who were purchasing the cigarettes largely for the purpose of
laundering criminal proceeds.
47. The RJR DEFENDANTS entered into agreements and understandings with
money launderers and narcotics traffickers in Europe, Russia, and South America to meet the
business needs of RJR and their coconspirators. These money launderers include but were not
limited to Gerardo Cuomo, Patrick Laurent, Gilbert Llorens, Corrado Bianchi, Werner Denz,
Martin Denz, Luis Garcia, members of the Mansur family, and Patrick Monnier.
Communications with or on behalf of these individuals were accomplished through a regular use
of the U.S. wires and mails.
48. Two Swiss companies known as Algrado A.G. (hereinafter referred to as
“Algrado”) and Weitnauer were primary distributors of RJR products and an essential link in the
money-laundering chain. During the time that the RJR DEFENDANTS and their coconspirators,
including Algrado and Weitnauer, were selling cigarettes through the aforesaid scheme, they
developed a sophisticated mechanism by which the proceeds of these sales could be laundered to
disguise their criminal origins. For example, throughout the 1990s and until some time in 1998,
a significant conduit for the laundering of criminal proceeds in THE EUROPEAN
COMMUNITY and the MEMBER STATES was a series of accounts opened in Liechtenstein
26
and Switzerland by Mingo Finance Limited, a British Virgin Island company. Payments of
criminal proceeds to Algrado for RJR products were made through several Mingo Finance
accounts, including but not limited to account #: 0577983-AB/US at the Bank of Liechtenstein,
One Herrengasse 12, located in Vaduz, Liechtenstein. The RJR DEFENDANTS knew or, but
for their willful blindness would have known, that the payments through Mingo Finance
constituted the proceeds of criminal activity.
RJR’s Direction and Control of the Money-Laundering Scheme
49. The RJR DEFENDANTS controlled every aspect of the financial transactions
involving the purchase of their cigarettes. The RJR DEFENDANTS set either favorable or
unfavorable financing terms for their customers as a means to reward, punish, and/or control the
customers. The RJR DEFENDANTS also controlled the exact methods and means by which
RJR was paid for the cigarettes. In this way, RJR structured its payment schemes to maximize
its own security from detection by United States and European law enforcement.
50. In addition to establishing the rules by which the RJR DEFENDANTS would
be paid by cash, Brady Bonds, secret payments to Swiss accounts, or other means as described
more fully below, the RJR DEFENDANTS also dictated that their criminal customers route
payments to RJR through intermediary distributors, shippers, and other cut outs. This procedure,
known in money-laundering jargon as “layering,” is conducted for the sole purpose of concealing
the payments’ true source from THE EUROPEAN COMMUNITY and United States law
enforcement. In the case of money-laundering transactions related to THE EUROPEAN
COMMUNITY and the MEMBER STATES, such intermediaries included Weitnauer, Algrado,
27
Copaco, and various exchange houses in Switzerland, including Intercambi S.A. In the case of
sales of cigarettes into Iraq, the primary intermediary was IBCS and other companies owned by
Issa Audeh.
51. At key distribution points such as Antwerp, Belgium, the RJR
DEFENDANTS utilized certain storage and shipping companies to handle their products. These
storage and shipping companies maintained lists of “direct customers of RJR” which included
special handling instructions for shipments designated for RJR customers that RJR knew were
involved in criminal activities. These direct customers included but were not limited to Porespa,
Copaco, Arbol, Brascotres, Icosa, Sacon, and others. These special handling instructions
included, for example, that all invoices for shipments to certain companies must be sent to
Renato Meyer, an employee of the RJR DEFENDANTS in Switzerland who was a central actor
in RJR’s money-laundering scheme. Instructions concerning other customers included that the
cartons (master cases) should be “neutralized and decoded.” To neutralize and decode a master
case meant to remove the marks and numbers on the case that otherwise could be used by THE
EUROPEAN COMMUNITY authorities to track and regulate the product. As to other
companies, special instructions included that invoices must not travel with the product but must
be sent to a particular fax number. These special instructions, directed by the RJR
DEFENDANTS, were intended to conceal the true purchaser of the cigarettes and/or RJR’s
relationship with these special customers. These “direct customer” lists clearly demonstrated
that the RJR DEFENDANTS knew that they were selling to criminal customers and thereby
demonstrated that the RJR DEFENDANTS knew that they were receiving criminal proceeds in
payment for their products.
28
52. RJR’s criminal customers were obtained, serviced, and supervised by other
RJR employees in Switzerland in addition to Renato Meyer, including Diego Luchessa and
Oscar Ivanissevich. Distributors and warehousemen in Belgium had regular communications
with these individuals regarding many of RJR’s criminal customers, including Porespa, Copaco,
Arbol, Brascotres, and others. For example, these criminal companies routinely used certain
ships for the shipment of RJR products. These ships included the Tara I, the Ali B, Bleu
Diamond II, and Wendy I. Details of the shipments of cigarettes aboard these vessels were
requested by and delivered to RJR employees in Switzerland, including Diego Luchessa, so that
RJR could keep track of the cigarettes all the way to their ultimate destination. In this way, the
RJR DEFENDANTS knew who their ultimate customers were and knew that they were
receiving criminal proceeds in payment for their products.
The Gerardo Cuomo Money-Laundering Organization
53. The RJR DEFENDANTS knowingly sold large volumes of cigarettes to
Gerardo Cuomo, an Italian citizen residing in Switzerland who is currently under indictment by
the Italian government for charges of money laundering and other criminal activities. The RJR
DEFENDANTS, their coconspirators, and Gerardo Cuomo created a complex web of companies
located in various bank secrecy havens to disguise the true nature and origin of the criminal
proceeds that the Cuomo money-laundering organizations were receiving from Italian mafia-type
criminal organizations which included the proceeds of arms trafficking, drug trafficking, and
other illegal activity. Monies received from Cuomo’s criminal activities, as well as from the
criminal activities of other mafia organizations, would be ferried illegally out of Italy in large
29
cash amounts and received by the money-laundering broker organizations located in Switzerland,
including but not limited to the Alfred Bossert organization and the Gegis money-laundering
broker organization. Gerardo Cuomo accomplished his purchase of RJR cigarettes through the
use of the U.S. wires and/or mails.
54. The principal company of the Gerardo Cuomo money-laundering organization
was Maxim S.A., located at Via Motta #34, 6900 Lugano, Switzerland. This company would
distribute RJR cigarettes to itself and to Italian criminal cigarette distribution, drug-trafficking,
and arms-trafficking organizations. These organizations delivered payment for the cigarettes to
money brokers in Switzerland who would in turn credit the payments to Maxim S.A.
55. From the accounts held by the Bossert money-laundering broker organization
and the Gegis money-laundering organization, payments would be wired to the different
companies that were providing huge volumes of RJR cigarettes to the Gerardo Cuomo
organization. The criminal proceeds would then be exchanged for RJR cigarettes as part of the
money-laundering process. Providers of the RJR products included:
(a.) Kyro Avia Limited located at 202 Christoforous Court, 3734
Limassol, Cyprus. Payments to Kyro Avia were made to account 233-10561419.1 at Union
Bank of Switzerland, 4001 Basel, Switzerland. Payments of criminal proceeds were made to
Kyro Avia on behalf of the Gerardo Cuomo organization by the money-laundering broker
organizations throughout the 1990s.
(b.) Van Caem Belgium Bvba, located at Van Cuyclestaat #7, Bus 13,
2000 Antwerp, Belgium. Payments of criminal proceeds to Van Caem were made throughout
the 1990s and were made to account 633.033.219 at KBC Bank Nederland N.V., located in
Amsterdam, Holland, Swift KRED NL 2X through KBC Bank N.Y., SWIFT KRED U.S. 33.
30
(c.) Rosacta Co. Ltd., located at 62 Arch. Makarios Avenue, 3728
Limassol, Cyprus. Payments of criminal proceeds to Rosacta were made to account 241-07-158027-
02 at Helenic Bank Ltd., located at Gladstonos Avenue in Anaxagoras Street, 3041
Limassol, Cyprus, Swift #: HEBACY2NLIM. Payments to Rosacta were made throughout the
1990s.
(d.) Namari Holdings Ltd., located at 22 Grenville Street, in St. Helier,
Jersey, Channel Islands, JE4PX. Payments of criminal proceeds to Namari were made to Harris
Bank International Corp., located at 430 Park Avenue, New York, New York 10022, Swift #
HATRUS33, for credit to the Royal Bank of Scotland International PLC, located at Royal Bank
House, Baxt Street, St. Helier, Jersey, JE48XF, account 16028601 for credit to sub-account
Namari Holdings Ltd., sub-account 34878/610/1045889 – Account name: “Nama Hold-USD1”.
(e.) Corlett Trading Limited also located at 202 Christoforous Court, 3734
Limassol, Cyprus. Payments of criminal proceeds to Corlett were made to account 310 465 US
dollars in the name of Corlett Trading Limited at Anker Bank Genf Postfach 4923, 8022 Zurich,
Switzerland, clearing number 8279. Payments were made to Corlett Trading for product
exchanged for criminal proceeds throughout the 1990s.
(f.) Old Navy Trading, 56 Macarious Avenue, Christoforous Court, Office
202, 3734 Limassol, Cyprus. Payments of criminal proceeds were made to Old Navy Trading
for products received and exchanged for criminal proceeds to account 10-561’419.1 US dollars
at Union Bank of Switzerland, located in Basel, Switzerland. Payments were made to Old Navy
Trading throughout the 1990s.
31
(g.) Icosa A.G., located at Post Office Box 409, 4132 in Muttenz,
Switzerland. Numerous payments of criminal proceeds were made to Icosa A.G. throughout the
1990s to account 700.192.00 held at Banque Vanorient Geneva, in Geneva, Switzerland.
(h.) Rowill International located at Mikseban, 238 Links, 2930 Brasschaat,
Belgium. Numerous payments of criminal proceeds were made to Rowill International on behalf
of the Cuomo money-laundering organization by the Swiss money-laundering broker
organizations to account 63.30.56.103 at KBC Bank, located in Rotterdam, Netherlands, Swift
KRED-NL-2X and additional payments were made to a second Rowill account 411-2015001-22
at the KBC Bank located in Antwerp, Belgium, Swift KRED-DE-22.
56. All of the aforesaid companies ultimately delivered these criminal proceeds to
the RJR DEFENDANTS. The aforesaid scheme was developed and facilitated by the RJR
DEFENDANTS.
The Alfred Bossert Money-Laundering Organization
57. One of the primary Swiss money-laundering organizations involved in the
wholesale laundering of the proceeds of narcotics trafficking, arms trafficking, and other
criminal activities in THE EUROPEAN COMMUNITY was the organization created by Alfred
Bossert, located in and around Lugano, Switzerland. Mr. Bossert’s primary company,
“Intercambi S.A.,” received and continues to receive large cash payments stemming from the
criminal activity of various criminal organizations operating in THE EUROPEAN
COMMUNITY, including the proceeds of narcotics trafficking. These payments would be
received by the Bossert organization in Switzerland, the sums would be counted, and the person
32
or entity to which the funds belonged would be credited with the appropriate amount. The
Bossert organization would then, either directly or through a variety of money-laundering
“subcontractors” such as Enrico Rosini and/or Gecap S.A., change the various currencies (i.e.,
Italian lira, Spanish pesetas, and others) into U.S. dollars, and would hold those dollars in several
accounts created and/or controlled by the Bossert organization or its “subcontractors”.
58. On a monthly basis, the Bossert organiz

[Dzono]

19 February 2004 16:15 pm
POLITIKA - ŠVERC - REAGOVANJE
Lukovac: Nametnuta i potrošena tema

Rim, (MINA) - Niko ozbiljan u Italiji više se na bavi tom nametnutom i potrošenom temom o švercu cigareta, izjavio je danas ambasador Srbije i Crne Gore u Rimu Branko Lukovac.

Italijanski istražni organi imaju potvrdu da se na računima crnogorskih građana na Kipru nalazi više od 500 miliona EUR zarađenih, najvjerovatnije, od šverca cigareta, prenijele su Vijesti tvrdnju agencije ANSA.

Iako ni jedan račun ne glasi na ime Mila Đukanovića, agencija taj novac dovodi u vezu sa njim, jer se tvrdi da računi glase na osobe bliske crnogorskom premijeru.

"Nema razloga za poseban komentar informacija koje neko pripremi, a agencija emituje", kazao je Lukovac agenciji MINA.

Prema njegovim riječima, tu informaciju do 16 sati nije prenio nijedan italijanski medij.

Lukovac je ponovio da od italijanskih zvaničnika nije stiglo zvanično reagovanje na medijske napise o optužbama Tužilaštva iz Barija na račun Đukanovića u vezi šverca cigareta.

"Nema ništa novo i jedni i drugi misle da se treba okrenuti novim odnosima Crne Gore i italije", kazao je Lukovac.

On je naglasio da mu je u susretima sa italijanskim zvaničnicima rečeno da tamošnji državni organi namjeravaju da prema Crnoj Gori podstaknu odgovarajuće programe saradnje.

"Ona je do sada bila neopravdano zapostavljena", ocijenio je Lukovac.

On je najavio mogućnost da već narednih nedjelja sa takvim zadatkom bude upućen predstavnik nadležnog italijnskog Ministarstva u Crnu Goru.

"Predviđeno je da se na novou vlada, odnosno ministarstava Crne Gore i Italije, formiraju posebna radna tijela za unapređivanje međusobne saradnje", kazao je Lukovac.

Prema njegovim riječima, planirano je da uskoro u Italiji budu organizovane promotivne aktivnosti o investicionim mogućnostima u Crnoj Gori, kao i zajednička akcija za otvaranje nedavno postavljenog spomenika Njegošu u Rimu.

"Sve to svjedoči o otvaranju nove stranice u odnosima Crne Gore i italije", naglasio je Lukovac.
(kraj) isf