Tigard man gets three years probabation for money-transmitting business
A Tigard man who the FBI says illegally wired more than $172 million in and out of the county will not face jail time.
Victor Kaganov, 70, of Tigard was sentenced to three years probation and four months of house arrest after pleading guilty to a single count of operating an unlicensed money-transmitting business, which is illegal under Oregon statutes.
Federal prosecutors charged Kaganov with operating an unlicensed money-transmitting business for more than a decade.
Investigators said Kaganov, a Russian immigrant, wired more than $172 million around the world between 1997 and 2009.
Kaganov allegedly established several businesses with the Oregon Corporations Division which served as shell companies for Russian clients. According to the indictment, he then used the companies to move millions of dollars in and out of the United States to more than 50 countries.
'When shell corporations are illegally manipulated in the shadows to hide the flow of tens of millions (of) dollars overseas, it threatens the integrity of our financial system,' said U.S. Attorney Dwight Holton when Kaganov was indicted in March. 'Sunshine kills the stink of corporation - our laws aim to bring the sunshine in, and we will enforce these laws vigorously.'
Kaganov's clients would wire money into the companies' bank accounts, investigators claimed, then Kaganov would instruct the bank to wire the money overseas.
Under Oregon law, Kaganov would have needed to obtain a license to operate the money-transmitting business. He would also need to register with the U.S. Department of Treasury.
The case was investigated by the FBI as part of a larger investigation involving shell corporations being used by foreign businesses and individuals to commit crimes.
'We will not allow Oregon banks to be used as cash machines,' said Arthur Balizan, FBI Special Agent in Charge of Oregon in a written statement after Kaganov's arrest. 'The use of Oregon shell companies to support the transfer of funds of unknown origin is a matter the FBI takes very seriously.
Kaganov, who emigrated from Russia in 1998, faced a maximum penalty of five years in prison and a $250,000 fine.