“Prosecutors Expect More Arrests in Art-Fraud Scheme”

August 19, 2013

The New York Times on August 19, 2013 released the following:


“Federal prosecutors handling the case against an obscure art dealer charged in one of the most audacious art frauds in recent memory told a judge on Monday that they expected more arrests in the continuing investigation. They also said they expected the case against the art dealer to be resolved soon.

The disclosures came at the arraignment of the dealer, Glafira Rosales, in United States District Court in Manhattan.

Ms. Rosales was arrested on money laundering and tax charges in connection with the scheme in May. She was arraigned Monday before Judge Katherine P. Failla on new charges contained in a superseding indictment that was handed up last week by a grand jury. She pleaded not guilty during the five-minute proceeding.

During the arraignment, Judge Failla asked one of the prosecutors, Jason P. Hernandez, an assistant United States attorney, if more arrests were expected.

“Yes,” he said.

Mr. Hernandez also said that the case against Ms. Rosales, which was the result of a lengthy F.B.I. investigation, was to be resolved in the coming weeks. He did not elaborate.

A lawyer for Ms. Rosales, Steven R. Kartagener, declined to comment on the new charges.

The charges issued last week revealed for the first time that all of the 63 phony art works at the heart of what prosecutors have described as a sweeping fraud scheme stretching over more than a decade were created by a single painter. The indictment identified him only as a painter who lives in Queens and said he had produced the canvases — purported to be by the hands of Modernist masters like Willem de Koonig, Jackson Pollock, Mark Rothko, Robert Motherwell and others — in his house and garage.

People briefed on the matter said he was Pei-Shen Qian, a struggling 73-year-old Chinese artist who came to the United States in 1981.

While he was paid a few thousand dollars for the canvases, they were later sold as works by Modernist masters for more than $80 million.

The indictment and other court papers said the painter who created the fake canvases was discovered selling his own art on the streets of Lower Manhattan in the early 1990s by Ms. Rosales’s boyfriend and business partner, an art dealer named Jose Carlos Bergantiños Diaz, who recruited him to make paintings in the style of celebrated Abstract Expressionists. The indictment does not name Mr. Bergantiños Diaz, but his identity is confirmed by other court records.

It is unclear whether Ms. Rosales has begun cooperating with the federal authorities since her arrest in May. But while the prosecutors handling her case initially argued then that she posed “a substantial flight risk” and that no bail conditions could assure her return to court, convincing a judge to detain her without bail, last week, after the new indictment was handed up, the prosecutors did not oppose her release on a $2.5 million bond.

Julie Bolcer, a spokeswoman for the office of Preet Bharara, the United States attorney in Manhattan, and an F.B.I. spokesman, James M. Margolin, declined to comment. Mr. Kartagener has refused to characterize his discussions with the prosecutors on the case, Mr. Hernandez and Daniel W. Levy.”


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Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

Yong Wang Indicted by a Manhattan Federal Grand Jury for Child Pornography

August 23, 2011

The Federal Bureau of Investigation (FBI) on August 22, 2011 released the following:

“Manhattan U.S. Attorney Charges Queens-Based Operator of 18 Chinese Language Child Pornography Websites

PREET BHARARA, the United States Attorney for the Southern District of New York, and JANICE K. FEDARCYK, the Assistant Director in Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today the filing of an indictment charging YONG WANG for operating at least 18 Chinese language websites containing child pornography out of his home in Flushing, New York. WANG, who has allegedly operated the websites since at least 2007, made hundreds of thousands of dollars by selling website “memberships” to individuals who paid to view, access, post, and download graphic images of child pornography. All of the websites were in Chinese and advertised to Chinese-speaking individuals in China, the United States, and elsewhere. WANG, 26, was arrested by the FBI at his residence in Queens on June 23, 2011.

Manhattan U.S. Attorney PREET BHARARA stated: “Yong Wang allegedly exploited the global reach of the Internet to develop an international customer base for child pornography. Purveyors of child pornography victimize the most innocent and vulnerable among us, potentially scarring them for life. As today’s Indictment demonstrates, we are committed to shutting down child pornography websites and working with our law enforcement partners across the globe to prosecute and punish those responsible.”

FBI Assistant Director in Charge JANICE K. FEDARCYK stated: “The charges against Mr. Wang stem from a nine-month undercover FBI operation, dedicated to protecting the most innocent members of our society–-children. The crimes alleged include operating 18 websites where ‘members’ could pay for child pornography. Mr. Wang not only profited from these websites, but he also created a system for its members to post innocent images, perpetuating the abuse of children.”

According to the indictment returned today in Manhattan federal court and a complaint filed on June 20, 2011:

On the child pornography websites, which WANG maintained and operated out of his apartment, members could access numerous links to an extensive child pornography collection that included images and videos of children exposing their genitals, engaging in sexually explicit conduct with adults, and in sadistic or masochistic depictions. To access the websites, individuals had to purchase a “VIP membership” or accumulate a certain number of points. WANG charged customers $25 for a quarterly membership or $100 for a lifetime membership.

Undercover FBI agents registered for a VIP membership with WANG and gained access to one of the websites, which was titled (in Chinese) “Empire of the Young and Innocent Fragrances.” On the website, users were directed to different forums with links that were titled with descriptive names, such as “Young Young Empire,” “Young Girl Beauty Photos Military Region,” “Young Boy Movie Zone,” and “Exclusive Quality Young Girl Photos Set.” After WANG’s arrest, the FBI identified 17 additional websites maintained and operated by WANG containing child pornography, all in Chinese. In conjunction with his arrest, the FBI also seized two servers in Texas through which the websites and the related online payment processes operated. The websites have been dismantled.

WANG is a permanent resident of the United States who was born in China. He is charged with one count of advertising in connection with the sexual exploitation of children (count one), one count of distributing child pornography (count two), and one count of reproducing child pornography for distribution (count three). On count one, he faces a mandatory minimum sentence of 15 years in prison and a maximum sentence of 30 years in prison. On counts two and three, he faces a mandatory minimum sentence of five years in prison and a maximum sentence of 20 years in prison on each count.

Mr. BHARARA praised the FBI in New York for its outstanding work in investigating this case. He also thanked the Chinese Ministry of Public Security for their extensive cooperation and assistance.

The case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorney ROSEMARY NIDIRY is in charge of the prosecution.

The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN List Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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