Two Ketchikan residents who are accused of possessing and dealing methamphetamine were arraigned Wednesday in U.S. District Court in Juneau on federal money laundering conspiracy charges.
Prosecutors allege Francisco Arca Seludo, 41 and his younger brother, Herman Arca Seludo Jr., 33, conspired to launder drug money through Western Union and MoneyGram from 2008 to February of this year, according to charging documents.
The brothers, who are being tried separately, pleaded not guilty to the new charges Wednesday before U.S. Magistrate Leslie Longenbaugh.
Conspiracy to launder money is a federal crime punishable by up to 20 years in prison. There can also be a $500,000 fine, or twice the amount of proceeds laundered, whichever is greater.
The Seludos and a third suspected drug dealer were all arrested in February on suspicion of possessing or distributing methamphetamine.
Francisco was arrested when he was found driving in California while he was out on $10,000 bail awaiting trial in a drug-related Alaska case.
The California Highway Patrol near Chico, Calif., contacted, then arrested him, after a records check showed he was in violation of conditions of release, according to the Ketchikan Daily News.
The Ketchikan Daily News reported he was apparently found driving with two Ketchikan women and several children with a large amount of cash and that everyone in the car had plane tickets to the Philippines.
He was taken back into state custody and slapped with another felony for failure to appear in a felony case.
Court records indicate Francisco has since pleaded guilty, and is scheduled to be sentenced in that case next month.
Meanwhile, Herman was arrested just a few days after his brother in February. The Ketchikan Daily News reported Ketchikan police executed a search warrant at his residence and seized about 30 grams of meth.
Herman was charged with two felony drug charges: third-degree drug misconduct for possession with intent to deliver and fourth-degree drug misconduct for using a building or vehicle to distribute drugs. He was also charged with a misdemeanor for violating release conditions in a December 2010 felony drug case.
Federal prosecutors became involved in April when Assistant U.S. Attorney Jack Schmidt charged them each with one count of money laundering conspiracy.
Originally from the Philippines, the brothers participated in the hearing with the help of an interpreter who spoke Tagalog.
The magistrate explained their rights to them, and then accepted their not guilty pleas.
Attorneys for both the brothers told the judge plea deals had actually already been reached in both cases, and that their clients were already prepared to change their plea whenever the court is ready.
The magistrate scheduled their change of plea hearings to be held next month.
• Contact reporter Emily Russo Miller at 523-2263 or at email@example.com.