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Ignoring issues such as morality and legality, money acquired illegally has one major drawback: concealing its illegal origins. Attempts to hide the source or destination of money acquired illegally is known as money laundering.
Illegal at both the state and federal levels, a conviction for money laundering carries a variety of potential penalties, including incarceration and substantial fines.
What are Federal Money Laundering Laws?
Federal statute provides three main guidelines that define money laundering.
- 1. Representing proceeds gained illegally as being acquired through legal acts, and then using those proceeds to perform illegal activities, avoid required financial reporting, and/or conceal the way those proceeds were acquired.
- 2. The transport or transmission of funds or other monetary instrument in the promotion of illegal activity, to avoid required financial reporting, or conceal the criminal acquisition of those proceeds.
- 3. Providing false statements about criminal proceeds to accomplish any of the goals listed in items one and two.
In simpler terms, anyone completing any financial transaction using monies he or she knows (or should know) were acquired illegally is guilty of money laundering.
Financial transactions include transferring property, moving proceeds, and transactions made through a financial institution.
What are the Penalties for Money Laundering?
Though the extent of penalties differ according to state, prior criminal history, and the amount of funds involved, you face three basic penalties if you are convicted of money laundering: fines, prison, and probation.
Fines vary widely, and depend on the amount of money involved. For example, a federal conviction carries fines of whichever sum is greater: double the amount laundered or $500,000. Incarceration depends on whether the charge is a felony or misdemeanor, and aggravating factors such as whether the crime involved terrorist activities.
Probation may be levied in lieu of jail time or in addition to it, and typically includes a variety of terms, such as reporting to a probation officer, drug screenings, and avoiding further illegal activities.
To demonstrate the extreme differences between states, we offer three examples: Arizona, Ohio, and California.
What are the Penalties for Money Laundering in Arizona?
Of the three states detailed here, Arizona has the harshest penalties. The state classifies money laundering into three categories:
- Money Laundering in the First Degree: A Class 2 felony carrying a maximum sentence of 12.5 years for a first offense. A second offense carries a maximum sentence of 23.25 years, and future offenses carry a maximum sentence of 35 years.
- Money Laundering in the Second Degree: A Class 3 felony carrying a maximum sentence of 8.75 years for a first offense. A second offense carries a maximum sentence of 16.25 years, and two or more convictions carry a maximum sentence of 25 years.
- Money Laundering in the Third Degree: A Class 6 felony carrying a maximum sentence of 2 years for a first offense. A second offense carries a maximum sentence of 2.75 years, and two or more convictions carry a maximum sentence of 5.75 years.
If convicted of either First- or Second-Degree Money Laundering that involves funds in excess of $100,000 over a 12-month period, the state seizes assets worth three times the amount laundered.
What are the Penalties for Money Laundering in Ohio?
The state of Ohio categorizes money laundering as a 3rd Degree felony offense. All penalties depend upon aggravating and mitigating factors, such as prior criminal history and amount laundered.
A conviction carries possible incarceration ranging between 9 and 36 months. In addition, Ohio levies two separate fines. The first is either $7,500 or double the amount laundered, whichever is greater. The second fine is for three times the amount laundered, payable to the state treasury.
What are the Penalties for Money Laundering in California?
California penalizes money laundering based on the amount laundered. In addition, the state labels each transaction occurring within the space of a week, and totaling over $5,000, as a separate offense. Alternatively, each series of transactions in a 30-day period that total $25,000 is charged as a separate offense. In both instances, the prosecutor may charge each offense separately, requesting sentencing and penalties for each charge.
A single money laundering offense carries a maximum sentence of 1 year, though the amount of the transaction may increase these terms, with state law providing increases all the way through $2.5 million.
Conviction also brings fines, either double the amount laundered or $250,000, whichever is greater. Prior convictions carry fines of $500,000 or FIVE times the amount laundered, whichever is greater.
Schedule a Free Consultation
If you face charges of money laundering, contact a criminal defense attorney for a free consultation. He or she will discuss your case and advise you on next steps.