Tigard, Oregon Man Sentenced to Three Years’ probation for Operating Illegal Money Transmitting Business

PORTLAND, OR—A Tigard, Oregon, man was sentenced on June 7, 2011, to three years’ probation with four months home confinement after pleading guilty to operating an illegal money transmitting business, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and Dwight C. Holton, United States Attorney for the District of Oregon.

Victor Kaganov, 70, and a naturalized citizen living in Tigard, Oregon, emigrated from Russia and set up on behalf of Russian clients, numerous shell corporations in Oregon. Through these shell corporations, Kaganov moved more than $172 million in and out of the United States to more than 50 countries worldwide in approximately 4,200 wire transactions.

In so doing, Kaganov did not comply with Oregon statutes requiring him to obtain a license to operate the money transmitting business. Kaganov also failed to register his money transmitting operation with the United States Department of Treasury, as required by federal statutes and regulations.

This case was investigated by the Federal Bureau of Investigation (FBI) as part of a larger investigation into the use of Oregon shell corporations by foreign businesses and individuals to facilitate the movement of illicit funds. This case included significant assistance received from FBI field offices located throughout the United States, as well as various FBI Legal Attaché offices in both Europe and in Asia. The FBI has allocated additional resources to its Portland office to address Eurasian Organized Crime. Investigators assigned to this effort are focusing on matters involving money laundering, mortgage fraud, and other federal criminal violations. The FBI received assistance in this investigation from the National Oceanic and Atmospheric Administration’s Office of Law Enforcement, the Department of Homeland Security, and the Internal Revenue Service Criminal Investigations.

The case was prosecuted by Assistant U.S. Attorney and Senior Litigation Counsel Allan M. Garten, Trial Attorney Robert Livermore of the Criminal Division’s Organized Crime and Gang Section, and Trial Attorney Michael Mosier in the Criminal Division’s Asset Forfeiture and Money Laundering Section.