Money Laundering and Drugs

Money Laundering

Money laundering is a serious financial crime that involves concealing the origins of money obtained through illicit means, making it appear as if it originated from legitimate sources. Under U.S. federal law, the primary statutes governing money laundering are 18 U.S.C. §§ 1956 and 18 U.S.C. §§ 1957. These laws impose strict penalties on individuals and organizations who knowingly engage in activities aimed at disguising the origins, destination, or ownership of proceeds derived from criminal activities.

Illegally Obtained Funds

18 U.S.C. § 1956 criminalizes several types of financial transactions intended to conceal illegally obtained funds. Specifically, this statute applies to those who:

1. Conduct financial transactions with the intent to promote the carrying on of criminal activity.
2. Attempt to evade taxes.
3. Conceal the nature, source, or control of illegally acquired proceeds
4. Avoid reporting requirements required for both domestic and international transactions.

Penalties under § 1956 are severe, with violations punishable by up to 20 years in prison and substantial fines.

Criminally Derived Property

Criminal Code 18 U.S.C. § 1957, by contrast, focuses on monetary transactions involving criminally derived property valued at over $10,000. To secure a conviction under § 1957, the prosecution must prove that the defendant knowingly engaged in a financial transaction involving proceeds from a specified unlawful activity.

Unlike § 1956, § 1957 does not require proof of intent to conceal the origin of the funds; rather, it merely necessitates proof that the defendant was aware of the illegal source of the money. Violations of § 1957 can result in imprisonment for up to 10 years and significant fines.

Federal Detection of Money Laundering

The federal government’s approach to combatting money laundering includes strict reporting requirements and regulatory frameworks. The Bank Secrecy Act (BSA), administered by the Financial Crimes Enforcement Network (FinCEN), requires financial institutions to file Suspicious Activity Reports (SARs) and Currency Transaction Reports (CTRs) for transactions exceeding certain thresholds. This helps to detect, deter, and disrupt money laundering activities by flagging potential illegal activities for further investigation.

Legal Process Money Laundering

Federal agencies, including the FBI, IRS, and DEA, work closely with international partners to combat money laundering, given its transnational implications. Money laundering laws extend to a broad range of criminal activities, from drug trafficking and fraud to terrorism financing. As a result, money laundering remains a significant focus of U.S. law enforcement efforts aimed at preserving the integrity of the financial system.

The Consequences of Money Laundering in California

In California, money laundering is both a state and federal offense, with severe legal consequences. Under California Penal Code §§ 186.10 and 186.11, money laundering laws aim to deter financial transactions intended to hide the origins of illegally obtained money or property. State penalties align with the federal approach, but specific enhancements apply for California-based criminal operations.

California Penal Code § 186 outlines the penalties for money for the crime of engaging in financial transactions to conceal money obtained from criminal activities, as follows:

• If the amount laundered is between $5,000 and $50,000, the crime is punishable by up to a year in jail and fines.
• For amounts over $50,000, penalties include up to three years in prison and significant fines.
• For cases involving amounts exceeding $2.5 million, sentences can be up to four years, with fines up to $500,000 or five times the amount laundered.

Aggravated White-Collar Crime Enhancement

California law applies harsher penalties for money laundering if it is part of a pattern of fraud or embezzlement. Known as the Aggravated White-Collar Crime Enhancement, this statute targets individuals or organizations involved in multiple fraudulent transactions totaling more than $100,000.

In addition to imprisonment and fines, those convicted may face:

• Seizure of Assets: Authorities can seize assets believed to be linked to laundering activities.
• Career and Licensing Impacts: Convictions can lead to restrictions on certain licenses, such as real estate or financial services.
• Federal Charges: Cases often involve federal charges, increasing potential penalties and extended prison sentences.

California’s approach reflects its commitment to curbing money laundering, especially within its substantial economy, and underscores the consequences for financial crimes involving concealment and fraudulent transactions.

Nate Crowley is a criminal federal defense attorney that works out of San Diego. He understands that both federal and state governments often work together to mitigate the broader impacts of organized crime.

Accused of Money Laundering? Contact California criminal federal defense attorney Nate Crowley.

Fill out our contact form on the Home Page https://www.natecrowleylaw.com/ 
Phone (619) 202-8188 OR email admin@crowleycrowleylaw.com