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Queens Chronicle

Pimp, ad exec get 1 to 3 in money laundering

‘Prostitution-based’ operation

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Posted: Thursday, June 6, 2013 10:30 am | Updated: 10:41 am, Thu Jun 13, 2013.

The a head of a Manhattan-based ad agency and a Flushing pimp have been sentenced to up to three years in prison for their role in a prostitution-based money laundering operation.

The office of New York State Attorney General Eric Schneiderman said Milagros Katz, 50, head of the Somad Enterprises advertising agency, pleaded guilty to second-degree money laundering in Queens Supreme Court on May 29.

Wei Qu, 51, who also goes by the first names William and Andy, was sentenced to one to three years in prison the same day for his prior guilty plea to a charge of enterprise corruption.

“Today’s sentences are part of our ongoing effort to ensure that those who participate in large-scale, prostitution-based money laundering operations —including advertising bosses who use seemingly legitimate business to hide their roles in these illegal activities — are held accountable,” Schneiderman said in a statement issued by his office.

The convictions were the result of a 16-month investigation by the AG’s Organized Crime Task Force and the NYPD.

The original indictment charged 19 people with various crimes that included falsifying business records, promoting prostitution and possession and sale of narcotics.

A review of Somad’s documents between January 2010 and October 2012 revealed that prostitution businesses bought more than $3 million in advertising, thus laundering the money through the ad agency.

The defendants used shell companies and false charges for cleaning services, party planning, antiques and acupuncture rather than illegitimate sex and narcotics.

Schneiderman said the prostitution groups relied on Somad’s relationship with media companies to secure discounts “for the criminal enterprise’s clients.”

The New York State Police, the state Department of Taxation and Finance, the U.S. Department of Homeland Security and the Westchester County District Attorney’s office all assisted with the investigation.

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