Documents unsealed in federal court lately show the increasing federal monitoring, investigation, and prosecution of a range of illegal gambling and its links to cryptocurrency and money laundering. A review of several unsealed warrants, indictments, and other court documents appear to show a coordinated multi-agency effort to include the U.S. Secret Service, the FBI, and even the DEA.

Most of these cases involve the allegations that the targets of the investigations committed Racketeer Influenced Corrupt Organization Act (RICO) crimes. The proximity of one case to another as well as the common players from one case to the next suggest links – or the building blocks, so to speak – that the federal government is using to take down organized crime related to the illegal transactions of money. It also may mean that the overall RICO investigation may only be in its infancy, as only two of the seemingly linked cases have so far resulted in convictions.

Most of the cases involve allegations that members of local law enforcement in Guam were involved or participated in the conspiracy.

 

Cryptocurrency

If the cases are linked for RICO prosecution, then according to the chronology of publicly-available federal court documents, they began with one of two cases that have already been successfully prosecuted: Either the William Ichioka cryptocurrency-Ponzi scheme case in the U.S. District Court of San Francisco, or the related Julian Weymouth case prosecuted in the U.S. District Court of Guam. Both Mr. Ichioka and Mr. Weymouth pleaded guilty to only a fraction of the crimes they were accused of committing, and both are serving federal prison sentences at only a small fraction of the imprisonment penalties they faced if they took their cases to trial and lost.

Mr. Ichioka faced 71 years in prison following an FBI investigation that found he swindled $61 million from investors into his Ichioka Ventures. While the case never went to trial, it was alleged from confidential sources that the young businessman from Guam assisted people from Guam in investing ill-gotten money in cryptocurrency.

As part of his plea deal, which resulted in a prison sentence of only four years, he agreed to assist federal law enforcement agencies. This is language commonly seen in plea agreements, and it is unknown what type of cooperation Mr. Ichioka provided to the federal government.

His activities, however, had links to the Weymouth case in Guam, according to a reliable source.

Mr. Weymouth is serving a 30-month sentence in a federal penitentiary after pleading guilty to financial crimes involving the investment of money from illegal gambling into cryptocurrency. According to his plea agreement, Mr. Weymouth admitted to knowing that some of his clients had given him money to invest in Bitcoin that was earned through illegal gambling, though the type of gambling was not specified in court documents in that case.

Letters to the court from current and now-retired members of Guam law enforcement indicate that several of Mr. Weymouth’s clients were cops.

Some of the names appearing in the Weymouth case overlap with names that would later be revealed in federal court records involving an online gambling conspiracy.

 

Online poker

Around the same time the Weymouth investigation was underway (and sealed), the  U.S. Secret Service was looking into an alleged illegal gambling conspiracy involving at least four Guam Police Department officers. A 26-page application for a warrant, which was unsealed only last month, accused the officers and others of running an illegal online poker scheme in 2020.

The warrant application hinged on information provided to the Secret Service by confidential sources for the federal government, who provided text messages among the alleged co-conspirators of an illegal gambling ring called Poker Bros, where hundreds of thousands of dollars were transacted and allegedly laundered through shell companies and into cryptocurrency.

The target of that particular warrant – GPD officer Jesse San Nicolas – was alleged to be the illegal gambling game organizer and owner. Mr. San Nicolas’ bank records indicate he transacted large sums of money, according to the Secret Service.

“This sum of money exceeds San Nicolas’ earning capability with his role as a police officer with GPD,” according to the agent who made the warrant application. Mr. San Nicolas’ salary, according to the GPD staffing pattern, is $37,751 per year.

Among the crimes alleged in the San Nicolas warrant was a violation of the RICO statute.

Secret Service special agent James Ingram, in a May 2, 2021 application for a warrant to search the electronic devices owned by Jovin Santos, said that based on “an examination of records,” and his interviews with “law enforcement officers, various other sources of information,” he believed Mr. Santos was part of the Poker Bros conspiracy, mainly because of Mr. Santos’ alleged association with Ricoh-Shane Cruz Meno.

According to the warrant application, it was confidential informants who alerted the federal government to Mr. Meno’s alleged illegal gambling activities in February of 2020.

“Each CI interviewed identified, either through their proximity and/or inside knowledge, that MENO established and owned the poker clubs ‘Guam Grinders’ and ‘Poker Pars,’” the Santos warrant states. “Each CI affirmed that MENO has recruited agents to assist in running this club, managing buy-in and cash-out processes via cash or PayPal, recruiting players, and hosting a WhatsApp messaging groups where he promotes games. Each CI stated MENO received a cut or portion of players’ buy-in for games, which is how he makes money for running the club.”

The warrant, which was unsealed only last week, goes on to state that the several informants’ testimonies were corroborated by “sworn law enforcement, civilians, and firefighters.”

Between the unsealing of the San Nicolas and the Santos warrants were the unsealing of several other warrants alleging the involvement of GPD, Guam Fire Department, Customs, Airport Police, and Port Police officers in online illegal gambling rings, all related to Poker Bros.

According to the Santos warrant, the Secret Service reviewed call logs, text messages, bank records, and the notes from PayPal transactions revealing Mr. Meno allegedly directed the transactions of hundreds of thousands of dollars into several accounts.

“Notes attached to payments received from individuals included ‘Reload, ID 774029, Please load brotha, Pis add to my acct# 714851, Account 714851, Par load for LatteStone, Pls add, [emojis used], For bul93, GRINDERS!!, For the games, Poker, BearRock83 ID:878652, Grinders, From Frank Rasa for Guam Grinders, Please deposit to player ID#: 90818, tournament time primo, Poker Bro’s, Gu grinder GCB671, MnM gu grinders, my donation for tonight gugrndrs, My Poker Bros’s account is ‘Travisdikdu’, Will poker,For dahustla on PokerBros, Pokerbros payment for player xiong67I.’” – warrant excerpt

According to the warrant application, Mr. Meno never held a job before. One of the confidential informants told the Secret Service agent that prior to the alleged illegal gambling ring, Mr. Meno earned money through the sale of marijuana.

During the course of the investigation, federal agents conducted surveillance at a Barrigada residence, where a CI was invited via Instagram to an in-person cash game.

“While discussing cash flow, MENO advised he separated player’s cash in one

box and other operational funds such as bonuses in another,” Mr. Ingram wrote in the warrant application. “He added that he maintained logs of balances owned and every two weeks, once a pay check, or once a month collected payments from players so his partners didn’t receive the information. MENO stated he had previously threatened players who are late on payments, including threats to send people to their houses to ‘fuck them up.’”

Also stated in the warrant application: “While discussing other poker clubs on Guam, MENO stated his club consisted of the biggest players, like the Chinese and Vietnamese, and that he sets the standard for how to run things.”

According to the Secret Service, Mr. Meno then claimed that if he were raided by law enforcement for the illegal gambling, they would only find $20,000 as he invested his earnings in alleged fronts that included a print shop, a lawn service, stocks, cryptocurrency, a residence, and a few pending brands.

That information is what led the Secret Service to investigate Mr. Santos.

The Santos warrant mainly consisted of allegations against Mr. Meno, however it was Mr. Meno himself, along with records obtained at the Guam Department of Revenue and Taxation that provided the Secret Service the alleged link to Mr. Santos.

The Secret Service, based on Mr. Meno’s assertion of his investments, looked at his Instagram account (ricohsuave671), which contained links to three businesses: “Grinder” clothing bran, “BLKBX” clothing brand, and “Yardwork Professionals” lawn service. Each of the business profiles showed references or links to the gambling club Guam Grinders.

All of this information led to Mr. Meno’s arrest, at which time he waived his Miranda Rights and offered information to the federal government. According to the warrant application, he admitted to the crimes and to the money laundering conspiracy involving the business fronts. He then told the Secret Service that he registered the businesses in the names of Michael Bautista Peredo and Jovin Santos. Articles of Incorporation for Yardwork Professionals showed Mr. Santos as one of the owners.

According to Mr. Santos, federal authorities returned his property after finding nothing to confirm his involvement in any illegal activities. “That’s because I’m not involved in any of that,” he said.

There is no federal court case against Mr. Santos that is publicly available.

 

Bingo

Several people will be facing a jury this year following their indictment last year in federal court for illegal gambling and money laundering through the former Guam Shrine Club’s Hafa Adai Bingo operation, which used to be at Guam Greyhound Park. The FBI discovered the alleged conspiracy in 2018, indicted a co-conspirator in a separate case in 2022, then used her testimony to secure warrants for bank records against the bingo operators and the non-profit organization that sponsored Hafa Adai Bingo.

Last year, Michael Marasigan, Alfred Leon Guerrero, Art Chan, Christine Chan, Richard Brown, Minda San Nicolas, and Juanita Capulong were indicted on multiple counts of illegal gambling and the laundering of $34 million in bingo proceeds that the federal government alleges should have gone to the intended consumer of the Guam Shrine Club: children from Guam in need of medical care in Hawaii.

Ms. San Nicolas and Mr. Leon Guerrero have since pleaded guilty and agreed to testify against the rest. Mr. Brown died earlier this year.

According to a reliable source, this bingo case is being used by federal prosecutors as an opening to prosecute other bingo operators in Guam whom federal law enforcement believe are involved in the same type of conspiracy.

 

Editorial: Cockfighting is next

If federal prosecutors are willing and excited to take down bingo operations, which some view as having contemporary cultural significance, then it doesn’t take too much math to figure that the federal government will soon turn its attention (if it hasn’t already) to the one gambling operation not already mentioned in unsealed federal court documents: cockfighting.

All the illegal gambling cases so far known to be investigated and prosecuted by the federal government involve alleged violations of local gambling laws. It was the laundering of the proceeds from these activities that gave the federal government the legal pretext to prosecute these crimes, as money laundering is a federal crime.

Cockfighting, however, is a federal crime on its own.

It is my belief that the bingo prosecution provides the federal government the political pretext to go after cockfighting next. Add to that the fact that several of the names already released by federal investigators of law enforcement officials allegedly involved in illegal gambling also are known cockfighters, and the writing is on the wall.

Information in the Santos warrant breathes additional life into this theory, where a Secret Service agent states that the information given to him by confidential sources, “were corroborated by sworn law enforcement, civilians, and firefighters.”

That means those law enforcement officers, firefighters, and civilians – many of whom we have to believe also are involved in cockfighting – have been cooperating with the federal government.

But there’s more to this. Earlier this year, Kandit received information that federal investigators have been asking about cockfighting activities in the CNMI. Members of Guam law enforcement who cockfight in Guam, also travel to the CNMI to gamble there.

Despite Guam’s local cockfighting law, which directly contradicts the federal cockfighting ban, the island is a U.S. Territory governed by an Organic Act that clearly states, “The legislative power of Guam shall extend to all rightful subjects of legislation not inconsistent with the provisions of this chapter and the laws of the United States applicable to Guam.”

The CNMI’s relationship with the United States, however, is governed by a Covenant between the Commonwealth and the U.S. Arguments have been made by local authorities that so long as CNMI law does not prohibit cockfighting, the gambling activity can remain.

The federal cockfighting ban, signed by former President Trump in 2018, however, applied to all the states and the territories, including the CNMI.

A Ninth Circuit Appeals Court panel in 2022 dismissed a case brought by a Saipan resident against the federal cockfighting ban, stating essentially that the ban was legal despite the Covenant.

The federal government’s increased enforcement of illegal gambling and financial crimes laws in Guam, its development of several confidential sources to include law enforcement, coupled with its reported interest in cockfighting in the CNMI are all signs of an investigation that will – if it hasn’t already – turn toward the takedown of cockfighting.

This is the time for cockfighters throughout the Marianas to either wage some Hail Mary attempt at an overturn of the federal law, or to simply take what they’ve won so far, and call it a day.