In the US, Money Laundering is a federal crime that in most cases is prosecuted under the set of federal statutes such as:

• Bank Secrecy Act;
• 31 USC Section 5311;
• Money Laundering Control Act;
• Patriot Act;
• etc.

In some cases, money laundering is dealt with on a state level, as most states have enacted their own local anti-money laundering laws.

The investigations into money laundering are performed by the FBI on most occasions. But it is not uncommon for the Department of Justice Asset Forfeiture and Money Laundering Section and the IRS Criminal Investigation section to be involved in the investigation process. Also, money laundering cases, which involve drug crimes, are handled by the DEA. And the Immigration and Customs Enforcement (ICE) deals with cases that involve cross-border smuggling.

The US Code constitutes the following activities as money laundering:

• Carrying out a financial transaction which involves money that the person knows or should know, were gained as a result of a criminal activity is considered a basic money laundering.
• International money laundering is moving money across the US borders in order to commit a crime. This includes situations where the defendant knows that the money is the proceeds of some criminal activity and the purpose of the money transfer is to hide information about the money, such as its location, source, or to avoid the reporting requirement.
• Sting Operations money laundering part of the AML statute makes it a crime to conduct any transaction with any funds that are believed to be criminal proceeds, even if it was the undercover agent who represented the money as such. The transaction must be conducted with the intent to commit another crime or conceal information about the funds.
• Money Spending Prohibition – transaction of over $10,000 that is criminal activity proceeds.

The most efficient defense in such cases is to establish that the defendant was not aware that the funds were derived from a criminal activity.

The federal Sentencing Guidelines are especially severe to defendants convicted of money laundering. Individual defendants face significant jail time, by far above the terms specified for the underlying offenses. Corporate defendants face substantial fines, often in amounts over $1 million.

As with other Guidelines provisions, the provisions for money laundering involve several factors that are used to determine base offense levels and specific offense characteristics.

Base offense levels are quite high, ranging between 17 and 23; a base offense level of 23 requires an incarceration period of between 46 and 57 months.

Specific increases in offense level depend on how much the defendant knew about the source and value of the laundered. If the defendant “knew or believed” that the laundered funds were connected to illicit drug trafficking proceeds, the base offense level is increased by three levels; proceeds of other unlawful activities also result in an increase. Likewise, if the funds are intended to be used for unlawful purposes, an increase may also ensue. If the value of the laundered funds is more than $100,000, the base offense level is also increased. A laundering scheme involving more than $1 million will result in an increase of five levels; a scheme involving over $100 million will cause an increase of thirteen levels.

However, conversely, a decrease in offense level may be available in accordance with the U.S. law.

As it can be seen, sentencing on a conviction for money laundering is in and of itself a complex area, that should only be navigated with the help of a competent and experienced counsel.

Under the New York law, money laundering is basically defined as a transaction intended to promote criminal conduct, either by hiding or disguising the proceeds or operating funds of the criminal conduct, or by avoiding legal requirements to declare the monies earned by such conduct.

The U.S. Code specifies 4 degrees of money laundering, and each is considered to be a felony in the state of New York. The essential difference between each degree is the amount of money involved.

• 4th – 5 to 50 thousand US dollars;
• 3rd – 50 to 100 thousand US dollars;
• 2nd – 100 thousand to 1 million US dollars;
• 1st – above 1 million US dollars.

However, money laundering that supports terrorism is criminally liable if the amount of money exceeds $2,000.

Money laundering in support of terrorism invokes another section of the New York state money laundering laws. While the minimum amount involved is lower, the penalties are more serious. The New York law defines money laundering in support of terrorism as cases where the accused knows or should have known that the funds either came from an act of terrorism or are intended for use in support of a terrorist act. A terrorist act is defined as an act designed to coerce a civilian population or government organization by murder, kidnapping, or acts of public destruction.

In the state of New York, money laundering has a range of penalties, from fines to imprisonment. While the fines for these crimes tend to be up to twice the amount of the money involved in crime, the jail time ranges according to the degree of the crime. The maximum number of imprisonment years that an accused person can be sentenced for is as follows: 4 for fourth degree money laundering, 7 for third degree, 15 for second and up to 25 for first. While money laundering in support of terrorism is technically assigned the same penalties, prosecutors are more inclined to seek, and judges to impose, the maximum available sentence when terrorism is involved.

New York money laundering statutes do not differentiate between U.S. citizens and citizens, whether individual or corporate, of foreign countries. Therefore, U.S. prosecutors can and do try foreign citizens on money laundering charges, even if the defendants were never physically present in New York, though, in practice, this is rarely done without the cooperation of the appropriate foreign government.

If you are charged with money laundering in New York, you should be aware that you may also be vulnerable to other charges associated with involvement in a criminal organization, such as enterprise corruption. Money laundering charges can potentially have very severe consequences. You should not settle for anything less than a highly experienced and knowledgeable criminal defense attorney at your side. Call our experienced NYC criminal defense attorneys at (212) 577-6677 to schedule an immediate consultation.

New York criminal attorneys with Norman Spencer Law Group PC have represented a number of individuals charged with money laundering in federal and state courts. We work with individual and corporate clients, both domestic and foreign. In all cases, we will provide a complete and competent evaluation of the facts and advise on the most efficient defense.

Our firm has over 75 years of combined experience representing clients in white-collar criminal cases across several continents. If you need to discuss a case involving money laundering charges or compliance issues, please contact our New York criminal and compliance attorneys today to set up a confidential consultation.