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US toy company owners sentenced in drug schemeLos Angeles toy company owners get 37-month sentence for role in drug money laundering scheme
LOS ANGELES (AP) ' Two sisters who ran a Los Angeles toy company were sentenced on Tuesday to 37 months in federal prison for their role in helping launder money for Colombian drug traffickers over the past 10 years.
Prosecutors had recommended a 15-month sentence for both Meichun Cheng Huang, 58, and Ling Yu, 53, who both pleaded guilty last year to one count of conspiracy. U.S. District Judge S. James Otero sentenced the sisters to a longer prison term, noting the scheme lasted for 10 years and he believed they knew the money was coming from drug cartels.
"They knew exactly what they were doing," Otero said. "It was just too profitable to turn away from."
The company also was ordered to forfeit $1 million and pay a $200,000 fine.
The complex scheme involved the deposit of drug money to Angel Toy Corp. bank accounts in exchange for Colombian pesos via the sale and shipment of the company's toys. More than $8 million was funneled into Angel Toy's bank accounts over a four-year period and each deposit was for less than $10,000 to avoid raising suspicion, authorities said.
Federal prosecutors said the toy company served as a financial conduit for the drug cartels in a scheme commonly known as the black market peso exchange. The scam allows middlemen to handle transactions between drug dealers and others who want to buy U.S. dollars outside the legitimate banking system to avoid taxes and import fees.
Large amounts of cash were dropped off by couriers at Angel Toy's downtown headquarters, broken down into smaller amounts and deposited into company accounts. The money was eventually funneled back to Colombia and into the hands of drug lords, authorities said.
The money was then used by a Colombian importer to purchase teddy bears and other stuffed animals. These toys were sent on to Colombia, where the importer sold them and gave the proceeds, in pesos, to the drug traffickers, authorities said.
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