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PHOENIX -- The owners of a luxury car dealership and a jewelry store have been charged with money laundering and conspiracy after authorities said the three men offered to hide a transaction from the federal government for undercover agents.

Hamid and Saeid Salari, owners of Luxor Auto Group in Scottsdale, were charged with money laundering and conspiracy. Farah Isaac, owner of Isaac Jewelers, also in Scottsdale, faced the same charges.

Attorneys for the three men did not return telephone messages on Friday. They were arrested Wednesday, and had initial court appearances on Thursday in federal court in Phoenix. All three suspects have been released on their own recognizance pending future hearings.

According to the criminal complaint, an undercover Internal Revenue Service agent met with Saeid Salari on Sept. 24, 2013, and expressed interest in buying a car without the proper paperwork being submitted on the purchase.

The agent explained to Saeid Salari "that he sells ecstasy and did not want any forms with his name on it saying he spent over $10,000 in cash," according to the complaint.

"After some discussion, Saeid Salari agreed to sell a car to (the undercover agent) with the understanding that cash obtained from drug trafficking activities would be used for the purchase and not be reported," authorities wrote.

A vehicle was chosen and a price of $80,000 was agreed upon. According to the complaint, the agent later gave Saeid Salari $20,000 cash inside a Crown Royal whiskey bag as down payment and agreed to return later with the rest of the money.

In December, an undercover agent returned with the remaining $60,000 cash, this time meeting with Hamid Salari who offered assurances again that the transaction would not be reported and acknowledged that he knew the money came from illegal drug sales, the complaint states.

The investigation continued until another meeting with Hamid Salari on Wednesday during which an undercover IRS agent offered to buy two more vehicles for $200,000 cash with the paperwork being filled out in the name of the agent's fictitious girlfriend, according to court documents.

Hamid and Saeid Salari were then arrested.

The probe into Farah Isaac and Isaac Jewelers began after the Salaris referred the undercover agents to the store to purchase jewelry with a similar cash transaction, authorities said. Also on Wednesday, authorities said Isaac agreed to sell two watches and a bracelet to an agent for $38,000 cash without reporting the transactions as required by law. Isaac was then arrested.

Both company websites remained operational on Friday. Luxor's site described the company as a dealership for luxury used cars, while Isaac offered fine jewelry "with an unforgettable experience."

Associated Press,

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