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Three arrested in Flushing money laundering scheme

By Dustin Brown

A trio from Flushing was arrested in a midnight raid July 4 for allegedly running a million-dollar money-laundering operation that washed profits from drug sales by sending them out of the country with counterfeit goods, the Queens district attorney said.

Police seized more than $1 million in cash as well as more than 5,000 counterfeit watches, pens and sunglasses when they searched the suspects’ house at 40-30 Utopia Parkway in Flushing shortly past midnight on Independence Day, Queens DA Richard Brown said at a press conference at his office on Wednesday, July 10.

The three residents — John Chen, 27, his wife Emily Chen, 29, and Zhiying He, 29 — were arrested that night and arraigned in Queens County Criminal Court before Judge Lenora Gerald.

They have been charged with money laundering and conspiracy and could be sentenced to 25 years in prison if convicted, Brown said. They also face possible trademark counterfeiting charges as part of an ongoing investigation.

John Chen was being held last week on $100,000 bail at Riker’s Island, and Emily Chen was released July 10 after posting $75,000 bail, said Department of Corrections spokesman John Mohan. Zhiying He was released on her own recognizance.

The three Flushing residents allegedly served as money launderers for various drug organizations by sending cash proceeds out of the country to pay for incoming shipments of narcotics, said Inspector Thomas Mullen, the commanding officer of Narcotics Borough Queens.

“Cash is the headache of the drug trade and other criminal enterprises because large quantities of smaller denomination currency are unwieldy and difficult to dispose of,” Brown said in a release.

They used a variety of methods to ship money, Brown said, sometimes stuffing it in tight wads beneath shipments of counterfeit goods such as watches, pens and sunglasses stamped with designer labels like Tommy Hilfiger and Rolex. The counterfeit items were also used as a form of currency, sent in place of cash to South America where they could be sold to tourists, Mullen said.

“If you didn’t have all the counterfeit goods here, you’d have more cash,” Mullen told the news conference, gesturing to a table that was stacked with boxes of watches wrapped in plastic and other merchandise, set alongside a pile of cash seized in the investigation.

Detectives who conducted a room-by-room search of the red brick house in Flushing recovered bundles of money stored in plastic bags and luggage as well as receipts for the wire transfer of hundreds of thousands of dollars to bank accounts in Hong Kong.

John Chen is the owner of two import-export businesses — International Transportation Group in Inwood and United Time, Inc. in Manhattan. A raid of the Nassau office July 5 yielded records suggesting the multimillion-dollar enterprise was allegedly funded by proceeds from the money-laundering scheme, Brown said.

Police also recovered $43,000 from safe deposit boxes at Flushing Savings Bank in Auburndale and Asia Bank in Flushing, and they seized 11 boxes of counterfeit goods in a second raid of the Flushing house July 9.

Officials said the arrests resulted from an ongoing investigation into the drug trade in the borough.

Reach reporter Dustin Brown by e-mail at [email protected] or call 229-0300, Ext. 154.

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