Federal Money Laundering Charges: 3 Things to Know

Federal money laundering charges are serious. Money laundering is a process that cleans dirty money by moving it through various channels, often to hide its origins.

This could be anything from tax evasion and fraud right down the line with drug trafficking or counterfeiting as well.

The laundered funds may move internationally but they’re still susceptible for investigation. These days, almost every financial transaction, international or domestic, is tracked by some governing authority.

Below is some helpful information on federal money laundering charges.

Money Laundering is a Federal Crime.

Money laundering is a federal charge under 18 U.S.C. §§1956 and 1957.

§1956 Charges.

Section 1956(a) defines three types of criminal conduct: domestic money laundering transactions (§ 1956(a)(1)); international money laundering transactions (§ 1956(a)(2)); and undercover “sting” money laundering transactions (§ 1956(a)(3))

To be criminally culpable under 18 U.S.C. § 1956(a)(1), a defendant must conduct or attempt to conduct a financial transaction, knowing that the property involved in the financial transaction represents the proceeds of some unlawful activity, with one of the four specific intents discussed below, and the property must in fact be derived from a specified unlawful activity.

The actual source of the funds must be one of the specified forms of criminal activity identified by the statute, in 18 U.S.C. § 1956(c)(7), or those incorporated by reference from the RICO statute (18 U.S.C. § 1961(1)). Section 1956(c)(7)(B) includes in the list of specified unlawful activity certain offenses against a foreign nation. Thus, proceeds of certain crimes committed in another country may constitute proceeds of a specified unlawful activity for purposes of the money laundering statutes.

To prove a violation of § 1956(a)(1), the prosecutor must prove, either by direct or circumstantial evidence, that the defendant knew that the property involved was the proceeds of any felony under State, Federal or foreign law. The prosecutor need not show that the defendant knew the specific crime from which the proceeds were derived; the prosecutor must prove only that the defendant knew that the property was illegally derived in some way. See § 1956(c)(1).

The prosecutor must also prove that the defendant initiated or concluded, or participated in initiating or concluding, a financial transaction.

A “transaction” is defined in § 1956(c)(3) as a purchase, sale, loan, pledge, gift, transfer, delivery, other disposition, and with respect to a financial institution, a deposit, withdrawal, transfer between accounts, loan, exchange of currency, extension of credit, purchase or sale safe-deposit box, or any other payment, transfer or delivery by, through or to a financial institution.

§1957 Charges.

Prosecutions under 18 U.S.C. § 1957 arise when the defendant knowingly conducts a monetary transaction in criminally derived property in an amount greater than $10,000, which is in fact proceeds of a specified unlawful activity. Section 1957(f)(1) defines a monetary transaction as a “deposit, withdrawal, transfer, or exchange, in or affecting interstate or foreign commerce, of funds or a monetary instrument . . . by, through, or to a financial institution (as defined in section 1956 of this title), including any transaction that would be a financial transaction under section 1956(c)(4)(B) . . . .”

The most significant difference from § 1956 prosecutions is the intent requirement. Under § 1957, the four intents have been replaced with a $10,000 threshold amount for each non-aggregated transaction and the requirement that a financial institution be involved in the transaction.

Although the prosecutor need not prove any intent to promote, conceal or avoid the reporting requirements, it still must be shown that the defendant knew the property was derived from some criminal activity and that the funds were in fact derived from a specified unlawful activity.

There are Defenses to Money Laundering Charges.

True money laundering schemes are meant to be deceptive. In many cases, it is a collection of transactions that, independently, may look innocent.

An an innocent person can easily be caught up in federal money laundering charges because the very nature of the crime is to be dishonest and hidden.

Typically the strongest defense is that the accused person lacked any intent to commit money laundering. If you can prove you had no knowledge of the criminal intent of the laundering scheme, you may be able to prove your innocence.

No matter what kind of case they have against you or your love ones it is up to the prosecution to prove guilt beyond a reasonable doubt.

Penalties for Federal Money Laundering Charges

Violations of § 1956 have a maximum potential twenty year prison sentence and a $500,000 fine or twice the amount involved in the transaction, whichever is greater.

There is also a civil penalty provision in § 1956(b) which may be pursued as a civil cause of action. Under this provision, persons who engage in violations of subsections 1956(a)(1), (a)(2) or (a)(3) are liable to the United States for a civil penalty of not more than the greater of $10,000 or the value of the funds involved in the transaction. Copies of pleadings in § 1956(b) actions are available from the Section.

Section 1957 carries a maximum penalty of ten years in prison and maximum fine of $250,000 or twice the value of the transaction. There is no civil penalty provision.

federal money laundering charges

Seddiq Law Attorneys have Decades of Federal Court Experience.

Justin Eisele and Mirriam Seddiq have handled over 400 hundred federal criminal cases. They have extensive experience handling federal money laundering charges.

Put their experience to work. The firm offers free consultation for those facing federal criminal charges. Click below and one of our attorneys will contact you within 2 hours to schedule a call.

Financing Available. Click to Read More.
+ +