Airports were central to a scheme that helped Atlanta businessmen collect hundreds of millions of dollars in revenue speculating in Iraqi dinars, federal investigators said.
In a June 9 civil forfeiture filing in the U.S. Court of the Northern District of Georgia in Atlanta, investigators asked to seize houses, three private planes and three luxury cars associated with executives of Sterling Currency Group LLC, which were allegedly used in a longstanding scheme to launder money and mislead investors.
Sterling executives — namely co-founders Tyson Rhame and James Shaw, as well as Chief Operating Officer Frank Bell — led customers to believe that a revaluation of the dinar would lead to “abrupt, exponential rise in value against the U.S. dollar and hence yield enormous profits for dinar holders,” prosecutors say in the filing.
In one year in 2011, Sterling sold $245 million in currency, with annual totals dropping to $126 million in 2012 and $109 million in 2013.
The filing cites emails between executives which investigators say show they had knowledge that they were running an “illegal operation” and believed the revaluation was “mythology,” despite the lines they were feeding currency buyers.
The Atlanta airport was the portal where the dinars entered the country in bulk, investigators wrote.
“Sterling purchases its inventory of dinar notes from exchangers in the Middle East, transports the notes in bulk to the United States via commercial carrier, retrieves the notes from Hartsfield-Jackson International Airport, and for storage to a business location in Atlanta, Georgia, where they remain available to fill customer orders placed on its websites.”
And 22 airports in the U.S., three in Canada and one in Puerto Rico were also the planned depots where customers could exchange dinar in the event of a revaluation.
Sterling Currency, operating earlier as Dinar Banker, promised buyers that it had the power to set up kiosks and satellite offices in major airports within 24 hours, complete with de la Rue currency conversion machines and necessary equipment to conduct wire transfers. The idea was that customers could easily fly in, make the exchange and depart, all without going through security, according to the filing.
“You will not have to go through security in the airport exchange locations – You can simply come in with Dinar in a briefcase or luggage and come to the exchange location set up in the office area of each airport,” read a posting on the company’s website, according to the filing.
Investigators said former employees and representatives from three airports confirmed that no such arrangements had been put in place.
Sterling’s owners have yet to be charged with a crime, but the filing indicates that they are the subject of an ongoing criminal investigation.
On its website, the company denies any wrongdoing.
“Despite the statements in the civil complaint, every single business related to the owners of Sterling Currency Group is legitimate and is compliant with all state and federal laws,” a statement reads. “Finally, we believe the record will show that representations made about internal communications between employees at Sterling in the civil complaint filed by the federal government are inaccurate and taken out of context.”