What the government has to prove
The main money laundering statute, 18 U.S.C. § 1956, requires a financial transaction involving the proceeds of a “specified unlawful activity,” a long list of federal and certain foreign offenses that includes federal health care offenses. The person must know the property came from some form of felony.
The government must also prove a purpose. That can be an intent to promote the underlying crime or to commit certain tax offenses, or knowledge that the transaction was designed to conceal the source, ownership or control of the money, or to avoid a reporting requirement.
A separate statute, 18 U.S.C. § 1957, makes it a crime to knowingly engage in a monetary transaction of more than $10,000 in criminally derived property. No intent to conceal is required, and the government does not have to prove the person knew which crime produced the money.
Charges and maximum penalties
| Charge | What it covers | Maximum prison term |
|---|---|---|
| Laundering, 18 U.S.C. § 1956(a) | Transactions or international transfers involving proceeds, made to promote a crime, conceal the money or avoid reporting | 20 years and a fine of $500,000 or twice the value involved |
| Monetary transactions, 18 U.S.C. § 1957 | Transactions over $10,000 in criminally derived property | 10 years |
| Conspiracy, 18 U.S.C. § 1956(h) | Agreeing to commit an offense under § 1956 or § 1957 | The same as the underlying offense |
| Structuring, 31 U.S.C. § 5324 | Breaking up transactions to evade currency reporting requirements | 5 years; 10 if part of a pattern of illegal activity over $100,000 in 12 months or while violating another federal law |
Structuring
Financial institutions must report currency transactions over $10,000. Structuring means arranging transactions in a pattern to avoid those reports, for example by splitting a larger sum into smaller deposits.
According to IRS guidance, structuring is illegal whether the money came from a lawful or unlawful source, and no single deposit has to exceed $10,000. The government must still prove the purpose was to evade the reporting requirement.
Structuring can be charged even when the money itself was earned legally.
Forfeiture
When someone is convicted of money laundering under § 1956 or § 1957, the court must order forfeiture of any property involved in the offense and any property traceable to it. That can include bank accounts, real estate and vehicles.
The government can also seek forfeiture in a separate civil case, which has its own procedures and deadlines.
Where these cases are often defended
Every case turns on its own facts. Issues that frequently matter include:
- Knowledge. Whether the person knew the money came from a crime.
- Purpose. Whether a transaction was meant to conceal anything, or was ordinary spending or business.
- Merger. Whether the laundering count simply repeats the underlying crime. Justice Department policy requires prosecutors to consult the Criminal Division in some of these cases.
- Tracing. Whether the government can connect specific property to criminal proceeds for forfeiture.
How Kaufman Legal Group can help
Jason Kaufman has tried more than 90 cases and is a Criminal Justice Act panel attorney in the Southern District of Florida. He also works as a jury consultant. He works with Phil Horowitz, who has practiced criminal defense since 1985 and spent decades on the CJA panel in the Southern and Middle Districts of Florida, and Victor E. Rocha, admitted to The Florida Bar in 1983, who practices in federal courts including the Eleventh Circuit and the Southern District of Florida and speaks Spanish. Together they bring more than 100 years of combined experience.
In money laundering and forfeiture matters, the team can respond to agents and subpoenas, contest seizures, review how the government traced the money and prepare the case for trial. The first consultation is free and confidential.