Two men were indicted on charges of operating a multimillion-dollar money laundering scheme from their apartments, sometimes charging six figures per transaction, prosecutors said.
Arthur Budovsky, 32, and Vladimir Kats, 33, illegally transmitted at least $30 million by letting customers deposit money with limited documentation, then using the cash to buy E-Gold — digital currency backed up by gold bullion, authorities said. Customers then withdrew their money through wire transfers or checks to international accounts or people overseas, they said.
The two were arraigned Thursday on charges of illegally transmitting $4 million over the first half of this year, and each pleaded not guilty.
The defendants’ company, GOLDAGE, charged for both ends of each transaction, authorities said.
'Presumption that something is wrong'
Manhattan District Attorney Robert Morgenthau said the six-figure fees were a red flag.
“When it is that high, there is a presumption that something is wrong,” Morgenthau said.
The men, both of Brooklyn, were charged with engaging in the business of transmitting money without a license, a felony violation of state banking law. Each was being held on $500,000 bail.
Igor Niman, who represents both men, had no immediate comment.
Morgenthau said the six-month investigation began in January, when undercover agents set up three accounts at GOLDAGE and moved money through the defendants’ companies.
Computers, business records and financial statements were seized from the defendants’ apartments on Wednesday.