Making money is often the motive for a crime. However, with the IRS looking at income, you can face federal charges if a criminal gain can be traced to you. Money laundering involves hiding your criminal profits by making the money look legitimate. Let’s look at how laundering money works and what happens if you are caught in the act of money laundering.
What is Money Laundering?
The popular show “Ozark” is all about a family who launders money for a drug cartel. In the show, it is obvious that they don’t have much choice initially. However, as the acts of money laundering become more extreme and dangerous, they have a choice to move on. Instead, they decide to stay and profit from their criminal activities with drug mobs.
Unfortunately, a life of crime doesn’t usually pay, at least not in the way you would like. Crimes that involve making large amounts of money often include drugs. Drug rings often mean there is an organized crime network operating. In the North Carolina Racketeer Influenced and Corrupt Organizations (RICO) Act, our state declares that their mission is to:
- Deter organized unlawful activity by imposing civil equitable sanctions against subversion of the economy by organized criminal elements
- Prevent the unjust enrichment of those engaged in organized unlawful activity
- Restore to the general economy of the State all proceeds, money, profits, and property both real and personal of every kind and description which is owned, used or acquired through organized unlawful activity
- Provide compensation to private persons injured by organized unlawful activity
Law Enforcement Tactics
One way that the state knows criminal activity is happening is by catching individuals in the act of money laundering. If you are a company trying to hide your deposits as legitimate cash income, law enforcement may not be able to prove that the money was ill gotten.
However, they will go over your books looking at everything you have deposited. If they’ve gotten wind of a large sale of stolen jewelry for example, they might look for deposits in your accounts that equal the amount of profit from the sale.
Large Business Transactions
When you own a business, you must report large transactions. The way to report cash transactions of $10,000 or more is through the IRS Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business. The form helps the IRS and FinCEN notice money laundering and fraud. These reports keep law enforcement in the know about suspicious activity.
In this form, you identify everyone involved in the transaction and explain the payment. You’ll need your client’s name, address, ID number, and tax identification number (TIN). You’re required to complete the form and submit it to the IRS within 15 business days of receiving the cash. You can also file Form 8300 online using the US Treasury BSA E-Filing System website.
The Bank Secrecy Act (BSA) is the primary U.S. anti-money laundering (AML) to detect and disrupt terrorist financing networks. Banks in the US make reports of suspicious activities. Every national bank must file a Suspicious Activity Report (SAR) when they detect:
- Deposits involving insider abuse regardless of the dollar amount
- Where there is an identifiable suspect with a transaction of $5,000 or more
- When the transaction involves $25,000 or more and no identifiable suspect
- Suspicious activity that is indicative of potential money laundering with $5000 or more
- BSA violations when the transaction involves $5,000 or more
If You Face Money Laundering Charges
If you are not attempting to launder money but face charges anyway, you need an excellent criminal defense attorney to investigate the charges at stake. As a legitimate business, a significant transaction may not get reported and can lead to unexpected charges.
You can face money-laundering accusations in addition to other white-collar crime charges from the federal organizations who prosecute these crimes:
- Drug Enforcement Administration (DEA)
- Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF)
Consequences of Conviction
If negotiation with prosecutors to have charges reduced or dropped fails, you could face time in prison. Convictions for money laundering carry a sentence of up to 20 years incarceration and fines of $500,000. If the transaction property value was more than $250,000, you could face fines of twice the property value instead.
We Can Help
You need a defense attorney who works well with federal prosecutors if the Feds charge you with criminal money laundering. Federal crimes often carry penalties that are far more severe than those levied by state courts. Your future is resting on how well your attorney can mitigate the charges against you. Our experienced and knowledgeable attorneys at Hogan, Edwards, and Blue work tirelessly in criminal defense cases to help you find the best path forward. Contact us today and find out how we can help you.