The United States Treasury Department estimates that, as of 2015, over 300 billion dollars is generated annually in the U.S. from illegal activities such as drug trafficking, prostitution, or human trafficking. Those engaged in illegal activities regularly conceal their illegally obtained wealth from entities such as the IRS or funnel the money through legitimate or fake businesses to make it appear as though the money was earned legally.
Moreover, legally earned money can be laundered through activities such as tax evasion, because the offender is concealing money from the government, which is an illegal activity for profit, and using those funds for personal gain. In fact, the IRS has reported that 1,201 money laundering investigations were launched in the 2016 fiscal year, which led 668 cases being sentenced with an incarceration rate 84.1% and an average incarceration sentence of 62 months.
Money Laundering Laws in the United States
State and federal money laundering statutes are very broad in nature. For example, under 18 U.S. Code § 1956, one form of money laundering is defined as engaging in a financial transaction or attempting to engage in a financial transaction, while knowing that the property involved in the transaction is proceeds from a criminal activity, and the purpose or intended purpose of the transaction is to:
- Promote the carrying on of a specified unlawful activity
- Violate section 7201 of the IRS code (tax evasion) or section 7206 of the IRS code (aiding in or assisting with false tax returns)
- Conceal or disguise the nature, source, location, ownership, or control of the proceeds of a specified unlawful activity
- Avoid a transaction reporting requirement under state or federal law
This is merely one form of money laundering that encompases many activities. 18 U.S. Code § 1956 goes on to define two other forms of money laundering that entail the transport of illegal funds and the act of planning or intending to commit the crime of money laundering.
Penalties for Money Laundering under Federal Law
If you are convicted of any form of money laundering under federal law, you could be forced to pay a fine of up to $500,000 or twice the value of the property involved in the transaction, whichever is greater, serve up to twenty years in prison, or both.
Money Laundering Laws in Arizona
Arizona law differs with federal in two very important ways. The penalties for money laundering vary based on how you committed the crime, and under state law, you could face a mandatory minimum jail or prison sentence under A.R.S. § 13-702.
Types of Money Laundering in Arizona
Generally, the different types of money laundering can be separated into three broad categories under Arizona law, which are paraphrased below:
- First Degree Money Laundering: involves the act of managing, organizing, or financing a money laundering business, or engaging in second degree money laundering activities in the course of or for the purpose of promoting terrorism.
- Second Degree Money Laundering: involves, in its most common form, acquiring or maintaining an interest in, transacting, transfering, transporting, receiving or concealing the existence or nature of racketeering proceeds while knowing or having reason to know that they are the proceeds of an offense. Although this is the most common form of money laundering, second degree money laundering can take many forms, which are defined in A.R.S. § 13-2317(B).
- Third Degree Money Laundering: involves compensating or for a better word, bribing someone to break any requirement for a financial institution codified in A.R.S. Title 6, Chapter 12. Moreover, an employee of a financial institution can be charged with money laundering for accepting a bribe or any other form of compensation to break any requirement in A.R.S. Title 6, Chapter 12.
Penalties for Money Laundering in AZ
If you are convicted of money laundering, the sentence imposed on you could change depending on the circumstances of the crime. Generally, the sentences imposed for money laundering are as follows:
- Third Degree Money Laundering: a Class Six felony with a presumptive term of imprisonment of one year
- Second Degree Money Laundering: a Class Three felony with a presumptive term of imprisonment of 3.5 years
- First Degree Money Laundering: a Class Two felony with presumptive term of imprisonment of five years
Money Laundering Attorneys in Tucson, AZ
Money laundering at both the federal and state level is a serious crime that can carry extremely harsh prison sentences. At the Law Office of Hernandez & Hamilton, PC, our money laundering attorneys have years of experience helping clients accused of money laundering reach the best possible resolution to their case. Call our office today for a free consultation to find out how an experienced money laundering attorney can help you.