What Is Money Laundering?
The phrase money laundering is commonly associated with large-scale organized crime. But anyone can face a money laundering charge, even when the underlying criminal activity is relatively small. Indeed, many people are not even aware of what activities qualify as money laundering until they are actually charged.
Transforming Criminal Process Into “Clean” Money
The basic concept behind money laundering is fairly easy to understand: A person takes proceeds from an illegal activity and converts it into “clean” money by investing it into an otherwise legitimate operation. The term “money laundering” is actually attributed to the infamous Chicago gangster Al Capone, who reportedly used a chain of laundromats to conceal the proceeds of his criminal enterprises.
Let’s consider a hypothetical example of money laundering. Jane embezzled $100,000 from her employer. She cannot simply put that money into her bank account, as that would raise suspicions. Instead she uses the embezzled funds to purchase a series of small money orders and deposit them over time.
Now, a more complex example–and one more common with organized crime–would be to launder cash through an existing legal business. If someone wanted to conceal the profits from a drug operation, for example, they might “invest” it in a restaurant. The restaurant then “re-invests” the money in other businesses. Ultimately, the drug money is passed through several entities, both to conceal the original source of the funds but also to avoid paying income tax. After completing this pass-through process, the money is then used to purchase a legal good that can easily be transported, such as jewelry.
How the Law Defines Money Laundering
Money laundering is a felony under both federal and state law. Federal law defines money laundering as conducting–or attempting to conduct–a financial transaction using proceeds that the person knew were the result of unlawful activity, either as part of that illegal activity or knowing that the transaction would “conceal or disguise” the illegal activity or to avoid reporting the transaction to the government.
What Are the Possible Defenses to Money Laundering?
It is not unusual for innocent people to get caught up in a money laundering case, especially if prosecutors are going after a larger criminal enterprise. Depending on the specific facts of a case, possible defenses to a felony money laundering charge include:
- The absence of intent. As noted above, the law requires proof that the person accused of money laundering knew they were using the proceeds of criminal activity. If the prosecution cannot prove the defendant knew where the money originally came from, then the defendant did not commit money laundering.
- The defendant acted under duress. If a criminal threatens an innocent person and forces them to engage in money laundering activities, they can raise duress as a defense. In some cases, a defendant may even have a viable entrapment defense if law enforcement effectively coerced them into committing money laundering.
- No connection to criminal activity. In order for a financial transaction to constitute money laundering, prosecutors need to prove the underlying criminal act that generated the “dirty” money in the first place. Without a crime, there is no money laundering.
Contact Orlando Criminal Defense Attorney Jose Baez Today
If you are charged with money laundering or any other white collar offense, it is in your best interests to work with an experienced Orlando criminal defense attorney who will zealously represent your interests in court. Contact the Baez Law Firm today to schedule a consultation.
Source:
law.cornell.edu/uscode/text/18/1956
