The unsealing of a federal indictment Tuesday against three key figures who allegedly transferred billions of dollars through suspicious accounts at the Bank of New York is a sign that authorities want to speed up a sprawling investigation--and will need help from overseas sources to do so.
With few exceptions, investigators could not previously give foreign law enforcement authorities particulars about the case's defendants, their companies and the alleged scheme to move about $7 billion out of Russia. That's because the information was under seal in federal court.
But with the year-long investigation turning toward the origins and final destinations of the money--at financial institutions in more than 50 countries--federal authorities said they have to be able to share case details in order to persuade their counterparts to swap what they learn.
In addition to looking overseas, FBI agents in most of the agency's U.S. field offices are following up on transfers made to financial institutions in cities large and small, one source said.
The unsealing of the charges underscores another likelihood: Investigators now need tips or guidance from an insider to sort through more than 87,000 transactions and determine the source of the money, according to money-laundering specialists familiar with the investigation.
In an ideal case, investigators would have been able to work quietly, perhaps for years, tracking the money flow through suspicious accounts or finding informants. But after news accounts about the probe appeared in August, authorities were forced to take a different tack, specialists said.
"If they had their druthers, they'd have rather this never hit the press," said a former federal law enforcement official who has conducted similar investigations. "What they're trying to do is get the people they indicted to cooperate. . . . If they have an insider who tells them, 'Here's what was done, here was the scheme,' it puts them light-years ahead."
Sources said federal prosecutors also wanted to release indictments before the Manhattan district attorney's office, which is conducting a parallel investigation. District Attorney Robert Morgenthau and Mary Jo White, the U.S. attorney for the Southern District of New York, have feuded over jurisdiction on previous cases.
"They wanted to beat out the DA's office," one source said.
Named in the indictment, which was originally filed under seal on Sept. 16, are Lucy Edwards, a former bank vice president who was fired in August; her husband, Peter Berlin, a Russian native (and now U.S. citizen) who authorities believe is the central figure so far in the case; and Aleksey Volkov, a business associate of Berlin's. The indictment also names three companies--Benex International Co., Becs International LLC and Torfinex Corp.--that handled the transactions in question.
None of the charges involve money laundering, which is more difficult to prove. The indictment charges that Edwards, Berlin and Volkov conspired to transmit money and receive deposits illegally. It also alleges that Berlin, Volkov, Benex, Becs and Torfinex illegally transmitted money in violation of federal law and that they engaged in an illegal banking operation by receiving deposits without authorization.
If convicted of all charges, Berlin and Volkov face up to 15 years in prison and fines of $750,000 or more. Under the conspiracy charge, Edwards faces up to five years in prison and a fine of $250,000 or more, officials said. The indictment also seeks the forfeiture of about $6.2 million seized from related Bank of New York accounts in August. All three have previously denied wrongdoing.
There's no doubt the case has a global reach. On Tuesday, Russian police raided a branch of the Moscow-based Sobinbank, which U.S. officials believe was a key source of money that flowed into the Bank of New York accounts. Russian officials have said they are investigating more than 10 domestic banks for possible tax evasion and suspicious transactions.
Rayburn Hesse, a former senior policy adviser on financial crimes at the State Department, said U.S. investigators will have to share as much as they can with their Russian counterparts to determine whether they can make a money-laundering case in court.
"As you determine the money distribution to other banks, to other countries, you have to be able to share as much information as possible," Hesse said.