The following is a guest blog post:
Disclaimer: This article should not be treated as legal advice. It’s recommended that readers still consult legal counsel and contact a lawyer should they have any concerns regarding potential money laundering.
When we’re dealing with a lot of money, things get a lot more complicated than usual. This is normal, as we’re dealing with a large sum of credit that needs to be tracked and recorded appropriately. For companies, moving around a lot of money for investments and capital are essential for profit; and for banks, moving money can be all in a day’s work. If you’re working with a lot of money, however, it’s important you know not just what happens while you move digits, it’s also important you understand what happens if something goes wrong. Money laundering is one of the many things people can do to mess around with huge sums of money, and while this is tempting for others, there are penalties involved when the occurrence of money laundering has been proven.
Do remember however that the information you’ll be reading below will only give a brief background on the penalties for money laundering. If you have questions on specific circumstances or situations, it’s still best you ask your lawyer for advice and clarification on your questions.
What is Money Laundering?
It may be important to understand how money laundering works before we go into its specific penalties. When we talk of “money laundering,” it’s the term to describe the transaction across finances that intends to take money that is obtained through questionable, illegal, or criminal acts and use it in a way that it appears as though it’s legitimate. Money obtained illegally is called dirty money, while money that is used legally is appropriately called clean money. Money laundering however doesn’t just apply to local transactions, but international transactions as well.
- The 18 U.S.C. of 1956 explains that a person commits a crime if they engage with any form of financial transaction with money obtained illegally, with the intent of promoting the activity or even conceal it.
- Meanwhile, the 18 U.S.C. of 1957 explains that a person engaging in monetary transactions with an amount of more than $10,000 can be liable for criminal charges if they know the money was obtained illegally.
It’s rare to see someone being charged with just an offense on money laundering, as laundering money can cover a lot of areas. Sometimes other charges such as wire and mail fraud, racketeering, and drug conspiracy are attached to the laundering offense.
- This might be because money laundering laws also see that there are other unlawful activities that occur when money laundering happens.
- For instance, a launderer knows that the money he/she’s laundering has been gained through illegal means, and therefore he/she’s actively engaging in the unlawful act. This involves concealing the act itself, alongside its proceedings, which includes avoiding proper reporting of the incident.
- This also occurs when dirty money is transmitted, transferred, or transported across the country or to other places, and if it’s used to promote illegal activity.
Penalties of Money Laundering
When we talk of the penalties for money laundering, this is usually determined depending on the amount of money involved in the money laundering case. However, it is known that some money laundering cases involve both fines and potential jail time.
- Fines for money laundering can reach as high as half a million dollars depending on the kind of things involved in the laundering transaction.
- The length of imprisonment when charged with money laundering also depends on the severity of the case, but it can reach up to 20 years. This involves a combination of prison time, and other fines associated with the act.
- Interestingly, the numbers involved above are determined “by count,” which means the penalties can also be brought depending on how many instances of money laundering has occurred for an individual.
- For instance, if someone has committed money laundering for 24 months, with one instance occurring at the end of the month, this can in theory charge the person with 24 “counts” money laundering. Federal Charges explains that person may have as much as $12-million to pay as fines, and around 480 years of imprisonment.
Cornell Law School also has a reference here on the specifics of money laundering laws that could potentially help you in understanding the subject.
If you’re dealing with a lot of money, it’s important to know not only the right way of making sure the travel of money is properly documented, recorded and transferred, but also the wrong ways that could result in a money laundering charge. Money laundering is a bad business practice that can have a lot of penalties when proven, and this can help you get a brief idea on what those proven of committing money laundering can suffer as penalties when discovered.
Anne McGee has over 20 years of experience writing about law subjects where she hopes her knowledge can help the common reader understand law topics that may be of relevance to their daily lives. If she’s not reading a good book, then chances are Anne is jogging during her free time.