May 25, 2017 - The article, "Questions Following Prevezon Money Laundering Settlement" by Elizabeth Prewitt, Marc Weinstein and Jeffrey Goldberg was published in Law360.
On May 12, 2017, on the eve of trial, the parties in United States v. Prevezon Holdings, Ltd., et al., No. 13-cv-6326 (WHP) (S.D.N.Y.), settled a civil forfeiture action over Manhattan property allegedly obtained with proceeds of money laundering and other unlawful activities. This case resulted from a four-year investigation by the U.S. Department of Justice (“DOJ”) focusing on an alleged $230 million tax fraud scheme carried out in Russia by Russians and against the Russian government, but yet was settled in a U.S. court for $6 million.
The facts as alleged, if true, shed light on a brazen fraud scheme, but the Russia-centric nature of the case raises the following questions: (i) What was the government’s jurisdictional hook? (ii) What was the specified unlawful activity (“SUA”) underlying the alleged money laundering? and (iii) What prompted the case to settle short of trial?