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Can you be convicted of unintentional money laundering?

On Behalf of | May 14, 2024 | Criminal Law |

Money laundering is illegal under federal and Montana laws, but it remains widespread. According to some sources, as much as $2 trillion is laundered globally every year — this represents about 5% of the global economy.

Much of this illegal activity is difficult to detect, but with the help of new laws and new technologies, law enforcement agencies have found ways to crack down on money laundering, and prosecutors have brought money laundering charges against many defendants.

Money laundering defined

Essentially, money laundering involves taking money gained through illegal means and concealing its origins by moving it into a legitimate enterprise.

In a simple example, a seller of illegal drugs might take his profits and use them to purchase real estate. The drug seller then sells the property, making it look like he gained the money through a legitimate real estate sale.

To further conceal the origin of the money, the drug dealer might use a so-called straw buyer — a person or business entity that is secretly controlled by the drug dealer.

Mandatory reporting

One way the law deals with money laundering is through mandatory reporting. Financial institutions are required to report suspicious activity by their customers. Likewise, some institutions must report any large transactions. For some types of institutions, large is defined as $10,000 or more. For others, the amount can be as low as $1,000.

As mandatory reporting and other detection methods have grown more robust, would-be money launderers have become more sophisticated. Some individuals and groups create shell companies that exist only to transfer money from one entity to another, hoping to conceal the money’s origins. The rise of cryptocurrency has provided further avenues for concealing the origin of money.

Money laundering charges

To answer the question posed in our headline, no, you cannot be convicted of unintentional money laundering. Intent is a requirement of money laundering charges.

In other words, if you run a business, you won’t be convicted of money laundering charges if you were unaware that one of your customers or business partners was laundering ill-gotten goods through your company.

That said, your company may be subject to various reporting requirements, and you could face penalties if you did not comply.

As with other white collar crimes, money laundering cases can be highly complex and their outcomes can depend on fine details. If you fear you may face money laundering charges, it’s a good idea to seek out professional advice.