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. Last Updated: 07/27/2016

Charges Filed in Bank of New York Case




NEW YORK -- Federal prosecutors have charged three people and three firms with illegally moving $7 billion from Russia through the Bank of New York, the first charges in what could be one of the largest money-laundering cases in U.S. history.


U.S. Attorney Mary Jo White said more charges were expected, and the worldwide investigation was likely to be a long one. The case has raised the question of whether Russian businesses, individuals and organized crime groups used the 15th-largest U.S. bank to launder billions of dollars.


An indictment unsealed Tuesday in U.S. District Court in Manhattan charges Peter Berlin, 44, Lucy Edwards, 41, and Aleksey Volkov, 34. It also names Benex International Co. Inc., Becs International LLC and Torfinex Corp. The Bank of New York, which is cooperating in the probe, was not charged.


Berlin was the president of both Benex and Becs and was married to Edwards, a former vice president at the Bank of New York and also an officer of Benex and Becs, prosecutors said. Volkov was the president of Torfinex, which allegedly handled the illegal money transfers.


Barry Kingham, a lawyer for Berlin and Edwards, said the couple will "appear in whatever court they're required to appear in.'' He declined further comment. His clients are living in London. Prosecutors said they suspect Volkov is also out of the country. His attorney, Michael Davies, said in Wednesday's New York Times that Volkov denies "any wrongdoing." He would not disclose Volkov's whereabouts.


Lewis Schiliro, an FBI assistant director in charge of the New York office, said the agency is trying to determine the origin of the funds and trace the path of transactions through accounts at the Bank of New York. "As this investigation has progressed, cooperation from the Russian authorities has been forthcoming and has been helpful," he said.


The indictment does not contain any charges of money laundering. But it says the defendants conspired to illegally transmit funds and receive deposits through Benex and Becs accounts at the bank. The defendants were charged because they allegedly engaged in an illegal banking operation by receiving deposits without obtaining authorization from any federal or state banking agency, according to prosecutors.


The indictment also seeks the forfeiture of bank and brokerage accounts, including the Benex and Becs accounts as well as accounts held by Torfinex.


The indictment alleged that the defendants continued to send money illegally through the Benex and Becs accounts even after Torfinex was ordered to stop by the New York State Department of Banking in October 1997.


If convicted of all the charges against them, Berlin and Volkov could face up to 15 years in prison and a fine of $175,000, or twice the gain or loss resulting from the crime. If convicted of the lone conspiracy charge against her, Edwards would face up to five years behind bars and a fine of $250,000.


Edwards was dismissed last month for violation of the bank's internal policies, falsification of bank records and failure to cooperate with the bank's investigation. She has denied any wrongdoing. If convicted, the corporate defendants could face maximum fines of $1.5 million and the forfeiture of accounts that collectively hold about $6.2 million.