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Corner stoneReport

The

Safeguarding America through 

Financial Investigations 

Volume X: No. 1 • August 2013 

Inside This Issue 

Project STAMP . . . . . . . . . . . . . . . . . . 1 

Case Study of the 

Velazquez-Zompantzi HTO . . . . . . . . . 2 

Case Study of the Olmedo ASO . . . . . 3 

Comments by John Byrne, Executive 

Vice President, ACAMS . . . . . . . . . . . 3 

Cornerstone is U.S. Immigration 

and Customs Enforcement’s 

(ICE’s) comprehensive 

investigative initiative for 

fighting financial crime. 

The Cornerstone Report is a 

quarterly bulletin highlighting 

key issues related to ICE Home 

land Security Investigations 

(HSI) financial, narcotics and 

special operations investigations. 

Toll-Free Tip Line: 

1-866-DHS-2-ICE 

www.ice.gov/cornerstone 

Project STAMP

Smugglers’ and Traffickers’ Assets, Monies and Proceeds 

A shrine to La Santa Muerte found in a search related to the Olmedo ASO (see page 3). On 

the right from top to bottom, a pistol grip shotgun, a handgun concealed over a window in a 

house, and a vehicle seized in the Olmedo ASO investigation. 

U.S.Immigration and Customs Enforcement’s (ICE) 

Homeland Security Investigations 

(HSI) launched Project STAMP 

(Smugglers’ and Traffickers’ Assets, Monies and Proceeds) to attack 

transnational criminal organizations 

involved in human smuggling and 

human trafficking from an aggressive anti-money laundering stance. 

Following the money trail in the identification of members of transnational 

criminal organizations, and identification of assets, monies and proceeds 

derived from or used in support of 

the criminal activity. The seizure 

of these assets is crucial to shutting 

down entrenched criminal activity. 

HSI and its partners have identified 

methods utilized by transnational 

criminal organizations to hide, move 

and store illicit proceeds associated 

with illegal activity through financial 

institutions, money services businesses and bulk cash smuggling. 

A high priority for the government 

is to seize the funds that motivate 

and amplify the problems associated 

with these organizations. Depriving 

transnational criminal organizations 

of the proceeds of the crime is yet 

another disincentive to commit these 

types of crimes. 

HSI analyzes the financial activities 

and operational methods of transnational criminal organizations, 

and identifies and disseminate 

typologies, indicators related to 

money laundering by human 

smuggling and human trafficking 

organizations. 

HSI collaborates with its private 

sector partners to evaluate how 

organizations use the financial 

sector domestically and abroad to 

collect payment for illegal services 

and share these methods with the 

financial community to shut down 

exploitable vulnerabilities. 

continued on page 2 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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The Velazquez-Zompantzi Human Trafficking Organization 

—HSI Miami 

Page 2 of 3 I

Volume X: No. 1 

August 2013 

n July 2009, 

p

special agents 

from U.S. Immigration and Customs 

Enforcement’s (ICE) 

Homeland Security Investigations 

(HSI) Miami initiated an investigation after identifying and interviewing two female victims of human 

trafficking in Miami, Fla. 

Special agents discovered that the 

two victims were coerced to engage 

in prostitution by brothers Jorge 

and Jaime Velazquez-Zompantzi, 

from the Tenancingo,Tlaxcala area 

of Mexico. Each woman was in a 

relationship with a brother, resulting 

in the birth of a child. 

While in Mexico, they were coerced 

to relocate to the United States, supposedly to work in a restaurant in the 

New York area.The victims’ children 

were left in the care of the paternal 

grandmother, Severiana ZompantziRojas in Mexico.The victims were 

brought by smugglers across the 

southern land border, then flown 

from Phoenix to New York. 

After arrival in New York, they were 

forced to prostitute themselves, and 

send their earnings to Mexico to support the Velazquez-Zompantzi family. 

Both women were eventually relocated to Florida, and were forced to 

continue working in the commercial 

sex trade. Ultimately, each victim was 

only permitted contact with her child 

when she wired money, thereby using the children as collateral to force 

the victims to continue working and 

sending their wages to Mexico. 

After the victims agreed to cooperate 

with HSI Miami special agents and 

stopped sending money to Mexico, 

the Velazquez-Zompantzi brothers 

severed communication between the 

victims and their children. A review of 

financial records associated with the 

trafficked women in this case revealed 

that each woman wired an average 

of approximately $1,800 a week, all 

proceeds of prostitution, to Mexico to 

maintain contact with their child. 

HSI Miami and HSI Mexico City special agents worked with the government of Mexico to prosecute four 

members of the Velazquez-Zompantzi family: Jorge, Jaime, Fausto and 

Severiana.They also rescued four minor children, two of whom belonged 

to the two victims in the HSI Miami 

case.With coordination from HSI 

special agents, the Mexico Consulate 

General in Miami and Mexico’s national child welfare agency, the victims in this case have been reunited 

with their children. Search warrants 

conducted in Mexico identified other 

women trafficked by this group. 

A judge in Mexico sentenced Jorge 

Velazquez-Zompantzi June 24, 

2011, to 18 years and six months 

for human trafficking and firearms 

violations. His brothers, Jaime and 

Fausto, and their mother, Severiana 

Zompantzi-Rojas, were sentenced to 

16 years and six months for human 

trafficking violations. n

Project STAMP continued from page 1 

Red Flag Indicators 

Through its joint efforts, the following indicators of suspicious financial transactions associated with human smuggling and human 

trafficking organizations have been identified: 

• Structured cash deposits to avoid 

currency transaction reports, followed by 

contemporaneous outgoing international 

wire transfers; 

• Business bank accounts that lack typical 

business expenses or account activity does 

not relate to the business; 

• Credit and debit processing for even 

dollar amounts, when atypical for 

business type;

• Large cash deposits inconsistent with 

business type;

• Multiple accounts established for different 

businesses, persons with the same signatory powers on each account; 

• Leasing of high-end luxury vehicles 

and extravagant trips paid by electronic funds transfer from business 

bank accounts; 

• Receipt of numerous incoming wire transfers or personal checks inconsistent with 

account type;

• Wire transfers from one business account 

to another business account that has no 

apparent ties;

• Credit card payments to online escort services for advertising, including small posting fees to companies such as Craigslist as 

well as more expensive, higher-end advertising and website hosting companies; 

• Large payments to foreign companies that 

are inconsistent with the amount of product received from these companies; 

• Unusual withdrawal, deposit or wire 

activity inconsistent with normal business 

practices, or dramatic and unexplained 

change in account activity; 

• Sudden change in customer’s normal business practices (such as dramatic increase 

in deposits, withdrawals or wealth); 

• Numerous Bank Secrecy Act filings by 

multiple financial institutions. 

• Checks written in even amounts deposited 

into bank accounts with “for a good time” 

or other repeated seemingly non-applicable 

phrases written in the remarks, memo field; 

• Multiple ATM withdrawals at the daily 

maximum amount (as high as $1,000 per 

day has been seen); 

• Structuring financial transactions at money service businesses (multiple financial 

transactions less than the $3,000 money 

service businesses reporting limit on the 

same day); and, 

• Customers who have reported identity 

theft—many extortion, kidnapping rings 

have stolen identities they utilize to facilitate their criminal activity. n
 

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The Olmedo Alien Smuggling Organization 

—HSI Corpus Christi 

Page 3 of 3 U.S. 

Volume X: No. 1 

August 2013 

Immigrap

tion and 

Customs Enforcement’s (ICE) 

Homeland Security 

Investigations (HSI) Corpus Christi 

special agents initiated an investigation of the Olmedo alien smuggling 

organization for transporting illegal 

aliens from the Rio Grande Valley to 

Houston,Texas, October 2010. 

Special agents linked the alien smuggling organization to a significant 

number of alien smuggling loads 

detained by the U.S. Customs and 

Border Protection Office of Border 

Patrol at the interior checkpoints 

located in Sarita and Falfurrias,Texas. 

Special agents identified approximately 60 members and associates 

of the illegal alien smuggling organization and developed information. 

The result was the interdiction of 11 

illegal alien smuggling loads and the 

arrest of 45 illegal aliens including 

several criminal illegal aliens and unaccompanied juvenile illegal aliens. 

Additionally, special agents seized 

a trailer, which the alien smuggling 

organization had outfitted with 

a hidden compartment.The hidden 

compartment had the capacity 

of concealing up to 12 persons 

and, if used in the severe heat of 

South Texas, may have resulted 

in serious injury or death of the 

smuggled aliens. 

The alien smuggling organization 

moved their illicit proceeds via bulk 

cash smuggling, money service businesses and funnel accounts. Initially, 

the alien smuggling organization 

was relying heavily on sending wires 

through money remitters. However 

the increased scrutiny of amplified anti-money laundering efforts 

with money service businesses and 

the significant attention given to 

wire activity of individual members 

caused the alien smuggling organization to change their methodology. 

The alien smuggling organization 

resorted to the seemingly undetectable scheme of funnel accounts 

and began to place their illicit 

funds into accounts held at U.S. 

financial institutions.The organization members opened bank accounts 

in source cities and provided the 

alien smuggling organization with 

the account numbers. 

Associates and other conspirators 

subsequently made structured 

cash deposits in destination cities 

to avoid the currency transaction 

reporting requirement. 

The account holder subsequently 

withdrew the illicit funds at various 

banking institutions.Then the account holder provided the monies to 

members of the alien smuggling organization in return for a small fee. 

Further analysis revealed the organization was smuggling approximately 

40 illegal aliens per month and 

received roughly $160,000 monthly 

in smuggling fees. 

The investigation of the Olmedo alien 

smuggling organization resulted in 53 

criminal arrests, 48 convictions and 70 

administrative arrests related to immigration violations.To date, 31 defendants have been sentenced, with terms 

ranging from probation to 87 months 

incarceration for human smuggling 

violations. Olmedo-Trevino, head of 

the organization, plead guilty to operating the alien smuggling organization 

and received 120 months incarceration, the maximum sentence allowed 

by law for this violation. In addition, 

approximately $93,000 in U.S. currency, two residences with a gross 

value of $100,000, four firearms and 

12 vehicles were seized as a result of 

this investigation. n

A message from Executive Vice-President of Association of Certified Anti-Money Laundering Specialists John Byrne 

Private-Public Partnership is a Cornerstone to the Successful Pursuit of Human Traffickers 

The membership of the Associa- U.S. Immigration and Customs role models for government agen- HSI staff have instructed the industion of Certified Anti-Money Laun- Enforcement’s (ICE) Homeland cies worldwide. try, listened to financial institution 

dering Specialists is comprised of Security Investigations (HSI). Human trafficking is a horrific experts, encouraged grassroots 

close to 14,000 anti-money laun- Created in 2003, the Cornerstone crime that attacks the very foun- organizations and clearly increased 

dering professionals from both Outreach Initiative is a financial dation of society. HSI reached their collective ability to fight those 

the private and public sectors. crime program that is dedicated out several years ago to the As- with no respect for life. 

Their goal is simple—working to outreach and partnering with sociation of Certified Anti-Money Cornerstone is an appropriate 

together to stay on top of all the private sector. While HSI Laundering Specialists and, more name since without public-private 

methods used by criminals and successes have been many, their importantly, individual financial in- partnerships, the criminals win. 

terrorists to move illicit funds. commitment to combating the stitutions, to develop a strategy of The Association of Certified AntiThis challenging mission is greatly scourge of human trafficking has information sharing, creation of red Money Laundering Specialists is 

enhanced by the leadership of the made the men and women of HSI flags and typologies for training. honored to work with HSI. n