Woman busted for unlicensed money transmitting business

A woman used a jewelry store inside the now defunct Tinian Dynasty Hotel & Casino as a front for an unlicensed money transmitting business in 2014 and 2015.

Federal agents on Saipan arrested Hong Mei Xu, 44, a Chinese national, on Aug. 12, 2016. She then pleaded guilty to conducting an unlicensed money transmitting business and the case was unsealed only yesterday.

According to the plea deal, the total amount of the illegal money transactions Xu conducted equaled at least $150,001 but no more than $249,000.

Xu conducted the unlicensed money transmitting business from Nov. 22, 2014, until Aug. 3, 2015.

During that period, Xu worked as the only employee of the Tinian Jewelry Store, a storefront inside the Tinian Dynasty Hotel & Casino. She had a key to the jewelry store and had access to the store 24 hours a day, seven days a week. Xu’s name and contact information was prominently displayed on a placard at the entrance of the store. The sign advised potential clients to contact her if they wanted to exchange or transmit money.

Members of the public, generally gamblers at the Tinian Dynasty, would contact Xu to “buy jewelry” with their UnionPay credit card.

In reality, no jewelry was ever sold to the customers. Instead, they would receive cash back minus a small commission.

The commission would not be paid directly to Xu; rather, the fee would be added to the credit card transaction.

Customers would hand their credit card to Xu, who would ring up a sale for an amount specified by the customer. She would then hand the customer a receipt who would use this receipt to obtain cash from a safety deposit box kept at the Tinian Dynasty Hotel & Casino.

In that period, at least $501,800 in credit card transactions were completed at the Tinian Jewelry Store.

Xu performed at least 50 of these illegal money transmissions in which a customer was charged a fee.

At no time has the Tinian Jewelry Store or any subsidiary or parent company ever registered as a money transmitting business as required by law.

Chief Judge Ramona V. Manglona issued the warrant of arrest for Xu on Aug. 5, 2016, shortly after the indictment was filed in court.

At the initial appearance hearing on Aug. 12, 2016, Manglona released the defendant on her own recognizance. She also set the jury trial for Oct. 18, 2016, and later to Nov. 29, 2016.

The jury trial did not push through because Xu signed a plea deal with the U.S. government and pleaded guilty to the crime on Nov. 10, 2016.

The sentencing was set for March 24, 2017, and later moved to Aug 25, 2017.

Manglona unsealed yesterday all documents and all proceedings in the case at the request of assistant U.S. attorney James J. Benedetto.