Money Laundering is a white collar crime that you commit by keeping, spending, transferring, or investing money that you know came from criminal activity. While it covers a wide range of financial activities, people often get in trouble for money laundering when they attempt to “wash” money that came from the criminal activity of others. “Washing” the money is supposed to conceal its source in such a way that an illegal enterprise would appear to be legitimate. Money Laundering is also closely tied to the Texas offense of Engaging in Organized Criminal Activity
UPDATE: SB 207, 86th Texas Legislature, adds digital currencies to the list of covered currencies under the state’s Money Laundering offense.1a
MONEY LAUNDERING ATTORNEY FAQs
Money is considered to be acquired through criminal activity if it was obtained through a felony offense or an offense punishable by jail time for more than a year.1 However, under Texas law, you do not need to know the specifics of the criminal activity, just that the money came from some sort of illegal activity.2
A Money Laundering charge most often arises out of extensive surveillance and investigation of a suspect’s financial transactions. However, state’s attorneys sometimes file Money Laundering charges that arose out of traffic stops or other unrelated activities. Another frequent case filed in tandem with a Money Laundering charge is a civil asset forfeiture case. This is a civil lawsuit that the government’s lawyers will file to take your money if they believe it has a connection to a criminal activity.
Have you been charged with Money Laundering? Call criminal lawyer Paul Saputo at (888) 239-9305 to discuss legal representation.
The current Texas law is as follows:3
A person commits an offense if the person knowingly:
(1) acquires or maintains an interest in, conceals, possesses, transfers, or transports the proceeds of criminal activity;
(2) conducts, supervises, or facilitates a transaction involving the proceeds of criminal activity;
(3) invests, expends, or receives, or offers to invest, expend, or receive, the proceeds of criminal activity or funds that the person believes are the proceeds of criminal activity; or
(4) finances or invests or intends to finance or invest funds that the person believes are intended to further the commission of criminal activity.
An essential element of the statute is that you committed any of the listed activities knowingly. You need to have known that the money came from a criminal activity. The state’s lawyers must prove your knowledge of criminal activity, but they don’t have to prove you knew the specific criminal activity.2
The four listed activities can be summarized as directly handling “criminal” money, supervising the transactions of “criminal” money, investing “criminal” money and investing “clean” money into a criminal enterprise.
Under Texas law, the punishment for Money Laundering is a felony but the severity of the punishment depends on the amount of money laundered. If the amount of money involved is between $2,500 and $30,000, it is a state jail felony. If the value of laundered funds is between $30,000 and $150,000, it’s a third degree felony. If the value is $150,000 to $300,000 it’s a second degree felony, and $300,000 or more is a first degree felony. Learn about the differences between grades of felonies
If the money from the criminal activity in question is related to one “scheme or course of conduct,” the money laundered can be added together and the total amount used to determine the punishment under the Money Laundering statute.4 Thus, the aggregate amount of money laundered can be used to sentence someone to more jail time, even if the money came from multiple sources.
Whether federal law applies to a case will also affect punishment. Federal law comes into play when more than $10,000 is laundered out of the United States. The maximum punishment under the federal Money Laundering statutes is 20 years in prison and either a $500,000 fine or a fine worth double the amount of money that was laundered, whichever is greater.6
Sections 34.02(c)-(d) of the Texas Penal Code provide statutory defenses to a charge of Money Laundering.7 One defense to Money Laundering is that you were acting with the intent to help lawfully recover the funds, for example by working with the police. Another defense is available when you launder money as a way to preserve your Sixth Amendment right to have an attorney.
Subsection (d) is available to lawyers who were paid legal fees from money obtained through criminal activity if the lawyer did not know that the money came from illegal activity.
Knowledge is also an important element of the Money Laundering offense (so it can be generally used as a defense to Money Laundering). So if you didn’t know there was any criminal activity involved, then you did not knowingly launder money and should be found Not Guilty. However, under Texas Penal Code Section 34.02(b), you are presumed to know that the money comes from criminal activity if they are told so by a peace officer, whether or not you knew at the time that that person was a peace officer.8
(1) “Criminal activity” means any offense, including any preparatory offense, that is:
(A) classified as a felony under the laws of this state or the United States; or
(B) punishable by confinement for more than one year under the laws of another state.
Knowledge of the specific nature of the criminal activity giving rise to the proceeds is not required to establish a culpable mental state under this section.
For purposes of this section, if proceeds of criminal activity are related to one scheme or continuing course of conduct, whether from the same or several sources, the conduct may be considered as one offense and the value of the proceeds aggregated in determining the classification of the offense.
(c) It is a defense to prosecution under this section that the person acted with intent to facilitate the lawful seizure, forfeiture, or disposition of funds or other legitimate law enforcement purpose pursuant to the laws of this state or the United States.
(d) It is a defense to prosecution under this section that the transaction was necessary to preserve a person’s right to representation as guaranteed by the Sixth Amendment of the United States Constitution and by Article 1, Section 10, of the Texas Constitution or that the funds were received as bona fide legal fees by a licensed attorney and at the time of their receipt, the attorney did not have actual knowledge that the funds were derived from criminal activity.
For purposes of this section, a person is presumed to believe that funds are the proceeds of or are intended to further the commission of criminal activity if a peace officer or a person acting at the direction of a peace officer represents to the person that the funds are proceeds of or are intended to further the commission of criminal activity, as applicable, regardless of whether the peace officer or person acting at the peace officer’s direction discloses the person’s status as a peace officer or that the person is acting at the direction of a peace officer.
“Financial institution” means a bank, trust company, insurance company, credit union, building and loan association, savings and loan association, investment trust, investment company, or any other organization held out to the public as a place for deposit of funds or medium of savings or collective investment.