The Asia / Pacific Group on Money Laundering explains on its typologies webpage, that one way to hide assets is by purchasing portable valuable commodities like diamonds. The typologies webpage provides the example of a beneficial owner concealing assets by transferring diamonds to another jurisdiction. One man who may have tried this kind of asset concealment method is Bernard L. Madoff. As reported in “U.S. Government to New York Judge: Jail Madoff Without Bail“, Mr. Madoff is alleged to have dissipated assets by mailing $1million dollars in jewelry to relatives and friends vacationing in Florida.
Another man believed to have hidden assets by using portable valuable commodities was recently discovered upon his arrival at N.Y.C’s J.F.K. Airport from Tel Aviv. A press release states that the 54-year-old U.S. resident employed by the jewelry industry, had concealed three diamonds worth more than $1.2 million in his pocket. U.S. authorities had first found jewelry receipts in the man’s baggage, then interviewed him and finally interdicted the concealed diamonds during a pat-down. These diamonds pictured below, were seized pursuant to 19 U.S.C. §1497, (Penalties for failure to declare) and 19 U.S.C. §1595a (c) (1) (A), (Merchandise introduced contrary to law):
My October 15, 2008 “Asset Search News Roundup” similarly mentioned that UBS banker Stanley Birkenfeld had hidden diamonds in a tube of toothpaste while an airline passenger at Swiss-U.S. border crossings. As more fully set forth by “UBS and the Diamond Smuggler“, Mr. Birkenfeld had assisted UBS bank customers like billionaire Igor Olenicoff hide assets and / or evade U.S. taxes. Besides using diamonds, Mr. Birkenfeld hid assets by using phony loans and purchasing artwork with secret Swiss funds.
Photo Courtesy of U.S. Customs and Border Protection
Copyright 2009 Fred L. Abrams