By Aaron Blevins, 1/17/2013
A Los Angeles check cashing store’s head manager and its designated anti-money laundering compliance officer were sentenced on Jan. 14 for failing to follow federal reporting and anti-money laundering requirements in relation to more than $8 million in transactions.
Karen Gasparian, the manager of G&A Check Cashing, a business located in the Westlake section of Los Angeles, and the store’s compliance officer, Humberto Sanchez, were sentenced by U.S. District Judge John F. Walter for violating the Bank Secrecy Act (BSA).
Walter sentenced Gasparian, 31, of Canyon Country, to five years in federal prison. In sentencing Gasparian, Walter rejected the defendant’s arguments that he had simply failed to comply with complicated regulatory schemes.
“It’s obvious he knew exactly what he was doing — laundering money,” he said.
Sanchez, 51, of Alhambra, was sentenced to eight months in prison. G&A was ordered to pay a fine of $962,932 as part of two-year period of probation. In addition, Gasparian and G&A were ordered to forfeit $240,733, which represents the profits they earned on funds going through G&A for which currency transaction reports (CTRs) were not filed.
G&A pleaded guilty in October to one count of conspiring to fail to file CTRs on transactions and one count of failing to have an effective anti-money laundering program. Gasparian pleaded guilty in September to the same charges. Sanchez pleaded guilty in October to one count of failing to have an effective anti-money laundering program.
The BSA is a set of laws and regulations enacted by Congress to address an increase in criminal money laundering through financial institutions, which includes check cashing businesses. Check cashers enable people to cash checks without having to go to a bank or maintain a bank account.
G&A, Gasparian and Sanchez failed to, among other things, create or retain required records, verify customer identification and file required reports such as CTRs. As a result, G&A and Gasparian engaged in multiple transactions involving $8,024,446, in which required CTRs were not filed.
According to court documents, check-cashing businesses are a common venue for individuals who want to anonymously cash large numbers of checks to facilitate fraud and money laundering schemes, precisely because they often fail to file required reports and to have effective anti-money laundering programs.