Money laundering is the process criminal organizations use to make the proceeds from illegal transactions ("dirty money") appear to be legitimate, or "clean." It's done so that criminals can use the proceeds of their crimes without attracting undue attention from the authorities.
There are dozens of different types of money laundering schemes, but there are three essential steps to almost any plan:
- Placement: Where the funds are moved from the source and put into circulation
- Layering: Where money and assets are redirected several times in order to make tracing harder
- Integration: Where money finally enters the financial system and appears to be legally obtained
Money laundering is particularly used for hiding the proceeds of crimes like drug dealing, prostitution, Medicare fraud and embezzlement.
Because of the way that money laundering works, there are several different professions that tend to attract money launderers. If you are in real estate, work in a bank, operate any kind of business that might do a large number of cash transactions (like a restaurant or laundromat), you might draw the interest of someone who wants to launder money.
The Money Laundering Control Act of 1986 changed the way that prosecutions for money laundering work. There's no minimum amount of money that has to be involved before a prosecutor can charge you, and the penalty can be the same whether you were involved with a scheme to launder $100 or $100,000. There are times when prosecutors may choose to focus on proving money laundering because they can't prove the underlying crimes that produced the funds involved. The Act also allows the government to seize any assets that are used in money laundering. Asset forfeiture is one of the primary ways that prosecutors aim to impair criminal organizations.
Money laundering is a serious crime. Many people get involved without realizing that they're being used as part of a larger scheme. If you are suspected of money laundering, a defense attorney with experience in white collar crimes can evaluate your situation and help you understand your options.