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DISTRICT ATTORNEY - NEW YORK COUNTY |
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News Release |
Contact: Barbara Thompson 212.335.9400 |
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The defendants are ARTHUR BUDOVSKY and VLADIMIR KATS. The defendants’ illegal money transmittal business is GOLDAGE INC. Also indicted today are other companies operated by BUDOVSKY and KATS: GOLDAGE HOLDING INC., ECSN INC., EXECUTIVE COMMERCIAL SERVICES INC., INTERNETWORK MANAGEMENT INC., GGN INC., B TO B MARKETPLACE INC. and MGA INTERNATIONAL INC. The defendants operated out of their Brooklyn apartments. The indictment charges that the defendants operated an illegal money transmittal business that received and transmitted $4 million between January 1, 2006 and June 30, 2006. The investigation leading to today’s indictment determined that GOLDAGE (www.goldage.net) was set up by BUDOVSKY and KATS in 2002, and at least $30 million was illegally transmitted to accounts worldwide since the start of the defendants’ illegal activities. BUDOVSKY and KATS allowed individuals to open accounts at GOLDAGE with limited documentation of identity. The investigation is continuing into the identity of the defendants’ customers and the source of customers’ funds. The investigation revealed that individuals would open an online GOLDAGE account. Then, customers instructed the defendants to purchase an amount of E-Gold for their accounts. Customers could also choose their method of payment to GOLDAGE. Specifically, they could wire money, make cash deposits or mail postal money orders and checks. BUDOVSKY AND KATS maintained various bank accounts under the guise of different defendant subsidiary companies: For example, GOLDAGE HOLDING INC., held accounts at Commerce Bank and Bank of America; ECSN, INC had accounts at Citibank; EXECUTIVE COMMERCIAL SERVICES INC., had accounts at Wells Fargo; INTERNETWORK MANAGEMENT INC.. Had accounts at Bank of America; GNN INC., had accounts at Wachovia; B TO B MARKETPLACE INC., had accounts at JP Morgan Chase; MEGA INTERNATIONAL INC., had accounts at Washington Mutual. Generally, cash was deposited into accounts at Bank of America, Commerce and Wells Fargo, while wire transfers and postal money orders were generally handled through accounts at Citibank and JP Morgan Chase. Once the defendants had purchased the E-Gold for their customers, the customers could withdraw the money by requesting wire transfers to accounts anywhere in the world or have checks sent to individuals anywhere in the world. The defendants kept a fee on both ends of the transaction; E-Gold charges a so-called “storage fee” for holding its digital currency. Yesterday, search warrants were executed at BUDOVSKY’S and KATS’s homes in Brooklyn. As a result, a number of computers were seized, as well as business records and various financial statements. In addition, the District Attorney’s Office has begun an asset forfeiture action against the defendants in the amount of $2 million. The indictment charges the defendants with violating the State Banking Law, which makes it a class “E” felony to engage in the business of transmitting money without a license if one knowingly receives for transmission $250,000 or more in a period of one year or less, $25,000, or more in a 30 day period or less, and $10,000 or more in a single transaction. The indictment encompasses illegal money transmitting activity from January 2006 through June 30, 2006. Assistant District Attorney Gary T. Fishman of Investigations Division Central presented the case to the grand jury under the supervision of Arthur D. Middlemiss and Adam S. Kaufmann, Chief and Deputy Chief of Investigation Division Central, respectively. Assistant District Attorney Suzanne Herbert is handling the asset forfeiture under the supervision of Asset Forfeiture Unit Chief Tara Miner. Investigators Steven Kelly, Michael Wigdor, Brendan Kenny and Gerald Bergold, working under the supervision of Senior Supervising Investigator Stephen McCallion and Chief Investigator Joseph Pennisi, assisted in the case. David Rosenzweig, Financial Intelligence Coordinator and Paralegal Benjamin Pred also assisted in the investigation. Defendant Information: Arthur Budovsky: Vladimir Kats:
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