McALLEN — Confusion over what, exactly, a man was pleading guilty to led a judge to delay accepting his plea in a case in which prosecutors allege that a McAllen beauty supply store was used to launder drug money under the guise of selling hair clippers and other beauty supplies.
Francisco Dominguez-Bermudez and Yolanda Peña were expected to plead guilty in federal court Monday to their roles in the convoluted money laundering scheme; however, the nearly two-hour hearing didn’t end quite as planned.
U.S District Judge Ricardo H. Hinojosa declined to accept Bermudez’s guilty plea and narrowly accepted Peña’s separate admission of guilt after confusion arose over their knowledge of the illegality of their alleged actions during the yearslong scheme.
“In 39 years (on the bench), I’m having the hardest time understanding what he was doing,” Hinojosa said, referring to the allegedly illegal actions prosecutors spent nearly an hour trying to explain.
Bermudez and Peña are just two of four total defendants named in a superseding indictment alleging that South Tex Beauty Supply — a wholesaler located on Broadway Street in McAllen — was actually a front used to launder money from illicit drug transactions that took place across the country.
The other two defendants are Maria Estela Suprise and Daisy Yannette Suprise, who own the beauty supply company.
In court on Monday, Peña testified that she had been their employee for about 20 years.
Meanwhile, Bermudez had been a longstanding customer who would routinely pay cash for bulk orders — primarily “Wahl” brand clippers — that he would then sell in Mexico.
Prosecutors said Bermudez would fashion himself as a beauty supply “distributor,” though he was not directly asked about that Monday.
Instead, much of the discussion revolved around prosecutors’ allegations that Bermudez had gone from being a legitimate distributor to facilitating the laundering of drug trafficking proceeds.
“He was provided product, sell it in Mexico, converted it into pesos, which he would then give to the drug traffickers,” Assistant U.S. Attorney Patricia “Pat” Profit said.
The product Profit referred to was legitimate — beauty supplies.
According to the prosecutor, rather than pay cash for the supplies, as usual, Bermudez began paying with money orders that had been purchased using the proceeds from illicit drug trafficking.
He allegedly did so at the direction of Maria Suprise.
Bermudez would then take the beauty supplies and sell them to legitimate customers in Mexico, where he accepted pesos as payment.
Afterward, he allegedly turned over those pesos to an unnamed drug trafficker in Mexico whom Profit claimed was the one calling the shots.
It was what Bermudez’s defense attorney, Reynaldo M. Merino, described as “trade-based money laundering.”
But, no matter how many times Profit or Merino tried to explain how the scheme worked, the judge seemed perplexed.
According to ComplyAdvantage — a tech company that provides anti-money laundering software — trade-based money laundering often works by over- or under-invoicing, issuing multiple invoices for the same shipment, or over- or under-shipping legitimate supplies.
In other instances, trade-based money launderers sometimes misrepresent the goods they are selling — saying they are higher quality than they actually are — in order to transfer the difference to their coconspirators.
But none of that was mentioned in court Monday.
Not once did prosecutors allege that Bermudez had kept a cut from the money orders used to pay for the beauty supplies, or from the scores of pesos he later turned over to the Mexican drug boss.
Instead, Profit repeatedly asserted that Bermudez had allowed his bank account at Inter National Bank to be used to make deposits knowing that the funds had been illegally derived.
“He is the one that is accepting the money orders deposited into his account. … They may have been (for) legal product, but they were bought with illegal proceeds,” Profit said.
“You’re gonna tell me he was doing this for free?” a visibly frustrated Hinojosa asked several long moments later before cutting Profit off as she began to make a reply.
“I won’t take his guilty plea today,” Hinojosa said, referring to Bermudez, who had stood quietly with his shoulders slightly slumped for the better part of an hour.
The judge came close to not accepting Peña’s guilty plea either as the court turned its attention to her case immediately afterward.
Peña pleaded guilty to accepting nearly $55,500 in cash from an undercover asset she thought was a truck driver delivering drug proceeds from Dallas.
Peña admitted that she met with the truck driver at the beauty supply store before directing him to go to a private office upstairs while she fetched a money counting machine.
The pair were joined in the office my Maria Suprise, who allegedly told Peña to be careful while counting the money, lest it be “her throat that would be cut if it were not accurate,” according to a document read aloud by the prosecutor.
But again, the judge had questions.
Namely, Hinojosa tried to determine if Peña had kept any of the proceeds for herself, and if she was truly aware that the cash’s origins were ill-gotten.
“How much did you make out of this?” Hinojosa asked Peña.
“Just the hours I worked, that’s all,” she replied in Spanish, saying her wages at the beauty supply store were just $12 an hour.
Peña initially said she suspected the money was dirty, but when pressed further if she understood what she had been doing was illegal, she responded, “yes.”
Hinojosa set Peña’s sentencing hearing for Sept. 28. He further ordered prosecutors to submit written documentation that more clearly describes Bermudez’s role in the money laundering scheme.
Meanwhile, Maria and Daisy Suprise, who have both pleaded not guilty, are next due in court on Aug. 5.
