ANOTHER MYTH-BUSTER: U.S. Extradites ‘Legal Adviser’ To Corrupt MLM From Colombia; Margarita Pabon Castro Charged With Helping Pyramid Scheme Launder Money For Narco Businesses

EDITOR’S NOTE: It is common for fraudsters to claim that “offshore” locations insulate HYIPs, autosurfs and other investment-fraud schemes from prosecution in the United States. It is equally common for purveyors to claim the schemes are harmless. The story of the alleged DMG pyramid scheme is one in which prosecutors allege a monstrous multilevel-marketing company created hundreds of shell companies and laundered money for narco businesses. The case is being prosecuted by U.S. Attorney Preet Bharara’s Terrorism and International Narcotics Unit.

Here, now, a story that destroys some of the myths advanced on the Ponzi boards . . .

U.S. officials now have confirmed the extradition of Margarita Leonor Pabon Castro from Colombia to the United States to face charges she helped a corrupt multilevel-marketing (MLM) company launder money for narcotics traffickers.

South American media first reported the extradition last week.

Pabon Casto, 36, was the legal adviser to David Eduardo Helmut Murcia Guzman (David Murcia), prosecutors said. Murcia, the head of D.M.G. Group (DMG), was extradited under heavy guard in January, and whisked to the United States by the U.S. Drug Enforcement Administration (DEA).

DMG used debit cards as the principal part of a pyramid scheme that largely targeted the poor in Colombia. The scheme is believed to have collected hundreds of millions of dollars from as many as 400,000 people before collapsing in 2008.

Pabon Casto was Murcia’s “personal friend,” sat on boards of companies related to DMG and “also assisted in accounting matters for DMG and in hiding information from Colombia’s
Superintendencia de Sociedades, an agency responsible for the regulation of corporations,” prosecutors said.

Part of the scheme involved the establishment of “hundreds of subsidiary and affiliated companies linked to DMG in countries including Colombia, Panama, and the United States,” prosecutors said.

Pabon Casto and six others now are charged with laundering narcotics proceeds through DMG and affiliated companies.

“With her alleged participation in a sophisticated money laundering conspiracy, Margarita Pabon Castro used her legal and accounting expertise to hide millions of dollars in dirty money,” said U.S. Attorney Preet Bharara. “Alongside our law enforcement partners here and abroad, the Manhattan U.S. Attorney’s Office will continue to pursue money launderers who profit from and drive the international drug trade.”

The DEA assisted in the extradition.

“By joining efforts with our law enforcement and prosecutorial partners, we identified, indicted and extradited those responsible for a million-dollar-a-year money laundering organization who worked for drug traffickers around the world,” said John P. Gilbride, DEA special agent in charge.

Read this Jan. 6 PP Blog story.