Colón Free Zone money laundering

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Public administration of the actual free trade zone discussed. Not a business alleged to participate in laundering. Photo: Zona Libre de Colón (Wikimedia Commons), CC BY-SA 4.0.

Panama’s Colón Free Zone is a commercial setting identified in several U.S. money-laundering cases involving jewellery wholesalers, import-export businesses and international payment networks. The Speed Joyeros and Argento Vivo prosecution, Waked proceedings, and Cheaitelly–El Khansa and Guberek actions involved different businesses and legal outcomes. Some notices identified Joumaa-related relationships. The jewelry prosecution and Waked criminal-case accounts do not identify a Hezbollah payment. Separate research accounts discuss wider alleged financial relationships.

Commercial setting

Free trade zones provide a setting for importing, storing and re-exporting goods under special customs or tax arrangements. Their economic purpose is distinct from the illicit use of particular businesses within them. Daniel Neale’s 2019 Global Financial Integrity analysis examined vulnerabilities associated with limited transparency and uneven oversight in such zones. It also emphasized the difficulty of seeing an underlying trade transaction from a payment record alone. Those observations help explain investigative challenges, but they do not measure the share of Colón’s trade attributable to crime. Nor does a general risk description establish the knowledge or conduct of an individual merchant.

The State Department’s 2019 and 2022 money-laundering reports described Panama’s geographic, financial and logistical role and identified vulnerabilities involving shell companies, nominee ownership, cash and trade. The 2022 report listed foreign financial fraud alongside drug trafficking, tax crimes, corruption and smuggling as sources of funds laundered in Panama. That range is relevant to the different predicate conduct in the cases: a laundering transaction need not originate in narcotics even when it uses similar business infrastructure.

Speed Joyeros and Argento Vivo

A Justice Department announcement dated 12 April 2010 described a joint American-Panamanian investigation of Speed Joyeros S.A. and Argento Vivo S.A., wholesale jewelry businesses in the Colón Free Zone. It reported that the companies and individual participants had pleaded guilty to money laundering in the Eastern District of New York. The account identified bulk jewelry purchases made with narcotics proceeds originating in the United States. This was a case with reported criminal dispositions and forfeited property, not simply a warning about commercial vulnerability. The announcement did not identify Hezbollah as a participant, customer or beneficiary of the jewelry operation.

The Justice Department identified Yardena Hebroni among those who pleaded guilty alongside Speed Joyeros and Argento Vivo. It also reported Eliahu Mizrahi’s later guilty plea and sentencing in February 2008. Its description of the Black Market Peso Exchange involved U.S. narcotics proceeds exchanged for Colombian pesos and used to buy goods in Colón. Those defendants and dispositions belong to the jewelry case, separately from the later Waked action and the Lebanese Canadian Bank vehicle-trade allegations.

Goods and criminal payments

According to the Justice Department, the businesses received drug proceeds through several payment forms and knew that customers were using bulk purchases to launder money. The goods themselves were tangible jewelry; their existence did not make the financing legitimate. The government connected the activity to the Black Market Peso Exchange. The U.S. Government Accountability Office’s (GAO) later explanation of that mechanism distinguishes genuine trade financed with criminal proceeds from schemes dependent on fictitious goods or false prices. The jewelry case illustrates why examining a consignment and examining its payment are related tasks: an apparently ordinary commodity transaction can form part of a documented laundering arrangement.

The 2010 announcement reported the arrival in Texas of more than forty million dollars in forfeited gold, silver and other jewelry, including gemstones and watches. It described approximately 468 boxes weighing ten tons and a final forfeiture order signed on 17 May 2006. These dates refer to different stages: the judicial order and the later transfer of custody. The announcement also described more than one hundred million dollars in annual business by the companies. That turnover figure is not interchangeable with the value forfeited or the amount of criminal profit. The record supports an asset-recovery outcome, without treating every commercial dollar as a separate laundering receipt.

Waked sanctions and criminal case

On 5 May 2016, Treasury designated the Waked Money Laundering Organization, two alleged leaders, six associates and sixty-eight companies under the Kingpin Act. It described laundering services for multiple trafficking organizations and alleged the use of false commercial invoicing, cash smuggling and other methods. Among the businesses named was Vida Panama (Zona Libre) S.A., an import-export company in Colón. Other targets operated in banking, retail, property and related sectors. These were administrative allegations about a broad network. Their appearance in one action did not establish that each company performed the same function or that every designee had been convicted of an offense.

The action affected more than a list of names. The Office of Foreign Assets Control’s (OFAC) contemporaneous notice also announced general licenses addressing specified activities involving a hotel, two newspapers and the Soho mall. Those permissions show that the implementation distinguished some otherwise prohibited transactions rather than treating all affected commercial activity identically. The notice is a historical record of the licenses announced that day, not a current compliance guide. Its significance for the case history is practical: a broad asset-blocking action can interact with ongoing businesses and other parties, while the reasons for designating a network remain separate from the conditions governing permitted activity.

Nidal Ahmed Waked Hatum’s criminal case supplied a more specific factual account than the network designation. An Eleventh Circuit opinion dated 14 January 2026 recounts his October 2017 guilty plea to a money-laundering conspiracy. The admitted conduct involved Vida Panama’s credit line at a bank in Panama and transfers to two Florida companies he owned, Star Textile Manufacturing and Global World Import & Export. He represented that the transfers financed purchases and supplied fraudulent invoices, although the purchases did not occur. The opinion identifies the funds as derived from fraud on the bank. It does not establish a Hezbollah payment.

The appellate account says that money transferred to the Florida companies was returned to Vida Panama, and the credit draws were repaid with interest. The bank therefore suffered no net financial loss. That fact did not erase the admitted fraud or laundering conspiracy. It became important in a dispute over forfeiture after a twenty-seven-month prison sentence. The distinction is substantive: the source of the funds in this admitted scheme was bank fraud, while the earlier sanctions announcement described a wider narcotics-laundering organization. The criminal outcome should be reported on its own facts rather than used to validate every allegation in the administrative notice.

Waked forfeiture appeals

The district court initially declined to impose a forfeiture money judgment, emphasizing repayment to the bank. In 2020, the Eleventh Circuit reversed that ruling and required further proceedings. On remand, the district court imposed a judgment of $10,426,000. The appellate court affirmed that judgment on 14 January 2026. The sequence reversed the original refusal to impose forfeiture. The amount is a court-ordered obligation arising from the laundering case, not evidence that the government had collected that full sum or that it represented drug revenue received by a terrorist organization.

Broader interpretations of Waked

Matthew Levitt’s 2017 testimony acknowledged that the Waked designation announcement mentioned neither Hezbollah nor Iran. He nevertheless reported that the action disrupted finances linked to both and prompted some activity to shift toward Paraguay. He repeated that broader interpretation in a 2018 analysis. This account concerns the reported effect of an enforcement action on wider financial relationships; it is distinct from the bank-fraud conduct admitted in Waked’s criminal case and does not identify a Hezbollah payment adjudicated by that case.

Other named service networks

A different Treasury announcement, dated 29 December 2011, described the Cheaitelly–El Khansa network and identified businesses in Panama and Colombia. It named Junior International and described an ownership and management history involving Joumaa and his associates. The notice also identified a laundering role for Ali Mohamad Saleh in Maicao. These are specific alleged connections between named actors, unlike an inference drawn from shared geography. They belong to their own enforcement record. The appearance of Panama in this account does not make the Speed Joyeros or Waked businesses part of the same network or transfer Saleh’s separately alleged Hezbollah fundraising role to them.

Treasury’s July 2013 Guberek announcement supplied another Panama connection: accounts held by shell companies used in an alleged laundering service based in Bogotá. The network was accused of processing proceeds for multiple traffickers, including Joumaa. Its October follow-up described a Madrid collection cell and funds moving toward Guberek-controlled accounts and Colombian traffickers. Research in Beyond Convergence interpreted such relationships as examples of financial services supplied across organizational boundaries. The connection concerns a service provider, accounts and named clients. It does not establish that Hezbollah owned the Panamanian companies or received every amount processed through them.

A separate FATF case study

A 2010 Financial Action Task Force report contains a separate, anonymized case study explicitly describing a Colombian-Lebanese drug-trafficking and laundering cell with Hezbollah links. It states that a portion of Middle Eastern drug proceeds went to Hezbollah leaders to permit trafficking in certain areas. The account identifies Colón businesses as participants in a wider Black Market Peso Exchange arrangement and the zone as a delivery point for bulk drug cash. It also describes Asian business accounts and goods sent to South America, alongside a related Miami electronics route. The report does not name the jewelry defendants, Waked or the Guberek participants in this case study, so those identities cannot be supplied from the shared mechanism alone.

Financial visibility and attribution

The Bankers Association for Finance and Trade’s 2017 study explains that a payment processor may lack the invoices, shipment records and other information held by trading parties. GAO separately distinguishes misrepresented trade from real goods financed with criminal receipts. Together, these mechanisms explain why investigators may need to follow both goods and money rather than treating a physical shipment as proof of lawful funding.

In a May 2026 INSS analysis, Noam Binstok, Orna Mizrahi and Esteban Klor describe purchases and resale of legitimate goods and informal settlement as complementary parts of decentralized financing networks. Their account concerns Hezbollah’s wider financial model, rather than the named Panama prosecutions. It offers a mechanism for comparison without supplying a missing organizational link in the jewelry or Waked criminal facts.

Emanuele Ottolenghi’s 2017 testimony quoted General John Kelly’s 2015 assessment that supporter networks could exploit places including Colón and transfer an unknown amount to Hezbollah. Kelly also emphasized limited intelligence about the scale of financing and criminal collaboration. That qualified regional assessment does not provide a transaction total or make all free-zone businesses participants in one network.

Distinct relationships and outcomes

The Panama cases concern jewelry sales, company accounts and international payments involving different businesses. The Waked opinion records a legal outcome without establishing terrorist financing. Joumaa-related notices identify separate alleged service relationships. The use of trading infrastructure is common to these accounts, but their participants, transactions and alleged beneficiaries differ.

See also

• Hezbollah Business Affairs Component
• Lebanese Canadian Bank

References

Legal and sanctions status as of 8 October 2026.