What Makes a Crime Money Laundering?


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Money laundering occurs when a person funnels funds acquired from criminal actions into legitimate businesses’ revenue streams. This permits the individual to clean the money through the company interactions so that it becomes usable without any connection to the illegal activity that the person derived it from originally.

Crimes of money laundering are commonplace with criminals that run an empire where funds acquired increase the revenue of the person or company through corrupt or illegal means. The legal consequences often include fines, taxation that may bankrupt the individual or business and prison terms. Through the criminal activity, the culprit may also face charges for the incident if he or she is caught. The crime of money laundering may point to the perpetrator through an investigation by law enforcement. Agents may even stake out the person or company and sift through vast amounts of data over years to make a case against the entity or individual.

Money Laundering Specifics

By moving cash or electronic funds from one location to another through a business, the individual may alter the illegal aspect of the income into a legitimate business interaction. While the activity is illegal, the company it funnels through may have valid revenue without any criminal involvement other than the money laundering. Law enforcement may acquire the financial data from the company to press criminal charges. However, if the accountant or tax professional attached to the business has no participation in the crimes, the company books may remain free of evidence. Any other individuals engaging in the illegal activity could receive charges of money laundering as well.

Laws Regarding Money Laundering

There are several anti-money laundering laws in effect that legislation passed to prevent the continuance of this type of criminal activity. The origin of the laws was to prevent the Mafia and organized crime to perpetuate illegal actions. However, the shift in the laws has refocused to the war on drugs and terrorism. To attempt to combat the problem, the Bank Secrecy Act implemented by the Administration is in use so that financial institutions report various transactions to the United States Department of Treasury. This involves large cash interactions and deposits or withdraws. They generally are over $5000 for each transaction.

The Internal Revenue Service will flag and investigate any cash transactions of $10,000 or more. This may lead the IRS into a full-scale investigation operation that could involve law enforcement when the department and agents determine that the person or company may engage in criminal activity. Any suspicious transactions also flag the authorities, and the person may lead the police, FBI or other agencies back to the source of the funding. This could cause the person or business to face criminal charges of money laundering or others. Legal representation may protect the person from further complications.

The Criminalization of Money Laundering

Legal conventions criminalized money laundering in 1986 through the Money Laundering Control Act. In conjunction with the IRS and law enforcement, an instance of laundering money through a legitimate business is illegal, and the culprit may face severe consequences if convicted in criminal court. The financial transfers of money from one location, company or person to another may apply in these situations where the person may face charges of the crime. In 1992, the penalties for these illegal acts increased through the Annunzio-Wylie Anti-Money Laundering Act. Additional review, training and analysis of procedures occurred in 1994 through the Money Laundering Suppression Act. When working in conjunction, the laws and Acts may provide a full basis to try the person through the criminal court system.

The Criminal Case of Money Laundering

Once the activity of money laundering is clear, the law enforcement agency performing the investigation will pursue criminal charges against the target. He or she will have the option to hire a lawyer for a defense against the allegations. However, there must exist enough evidence to attempt to show the judge or jury that the person is guilty beyond a shadow of any doubt. This may include expert witnesses, other witness statements and proof through financial transactional data.

The legal defense against the charges will become necessary to prove that the person defending against the accusations in court is either the incorrect person or not a participant in the money laundering activity. When the person is innocent, it is possible he or she may have information on the true culprit and could broker a deal for immunity for criminal charges with the illegal activity.

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.

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