What Is Money Laundering & What Are the Penalties? - Dughi, Hewit & Domalewski (2024)

Television shows like Good Girls and Breaking Bad give the perception that the only people who launder money are overtly violent drug dealers with silver cases bursting with hundred-dollar bills.

In reality, money laundering is often connected to white-collar crimes like identity fraud and embezzlement. Although the average Netflix viewer may not realize this, banks do and they have a legal obligation to report strange financial patterns to authorities so that a formal investigation can be launched.

Authorities may view the following signs as “red flags”:

• Unexplained funds transfers
• Irregular banking patterns
• Unusually complicated business structure
• Frequent high dollar cash transactions
• Multiple fund transfers that are just under $10,000 over a short period of time

Even if you aren’t involved in any criminal activity, you could be accused of money laundering for “unusual” banking activity. In the unfortunate event that you’re met with federal money laundering charges or New Jersey money laundering charges, it helps to have a solid understanding of what money laundering is and what penalties you could face.

What is money laundering?

When a person obtains financial resources through illegal activity and attempts to make these resources appear to have a legal source, this is called money laundering.

An individual engaging in money laundering often filters illegally obtained money through a shell company, such as a laundromat, restaurant, or beauty shop. This presents an opportunity to disguise the funds as “legitimate” income.

Other times, the money is transferred through a long list of onshore and offshore bank accounts in small, difficult-to-track financial transactions. Sometimes, the latter tactic is combined with purchasing and exchanging cryptocurrency with illegally obtained funds, which is even more challenging to track and prosecute.

No matter the method, money laundering is a serious criminal activity punishable by state and federal law. These serious allegations can impact every aspect of your life negatively.

Money laundering charges in New Jersey

NJ law defines the following criminal activities as money laundering:

• Transporting or possessing illegally acquired property and assets
• Engaging in financial transactions to launder money
• Organizing, financing, or supervising the laundering of illegally acquired money
• Evading required reporting of financial transactions

For a jury to convict you, the prosecution must prove that a crime occurred and generated money and that you purposefully used the money in a manner intended to disguise its origin.

Federal money laundering charges

Federal money laundering statutes can be complex to navigate. At the simplest level, the United States government defines money laundering as disguising illicitly obtained financial assets to be used without revealing the crime that was committed to secure them or in an attempt to avoid paying taxes.

When committed with intent to carry on illegal activity, avoid paying taxes, or conceal the source of assets, the following activities put you at risk of federal money laundering charges:

• Conducting or attempting to conduct a financial transaction with money you know (or reasonably should know) was gained via illegal activity
• Transporting, transferring, or attempting to transmit any funds to or from a foreign country
• Knowingly engaging (or attempting to engage) in a monetary transaction with criminally derived property that is valued at more than $10,000

Major crimes connected to laundering

At the heart of every New Jersey state or federal money laundering case is profitable illegal activity. Crimes that could be associated with money laundering often relate to criminal enterprises, and may include:

• Arms trafficking
• Bank fraud
• Credit card fraud
• Drug dealing
• Drug trafficking
• Embezzlement
• Extortion
• Identity theft
• Insurance fraud
• International or domestic terrorism
• Mortgage fraud
• Organized crime
• Political corruption
• Robbery
• Sex/Human trafficking
• Violent crimes
  

Whether funds are gathered through fraudulent activity or violent illegal activity, money laundering is not a victimless crime. If you’ve been charged with money laundering, you may also face charges for one of the forms of criminal activity listed above.

To fight state or federal money laundering charges, you need a criminal defense attorney you can trust.

State & federal penalties for money laundering

If authorities accuse you of violating New Jersey state money laundering laws, there is the possibility that you could be accused of violating federal money laundering laws.

The state and federal penalties that could result if you’re convicted will vary but may depend on:

• The amount of money involved
• Whether or not you attempt to obstruct evidence
• The exact nature of the related criminal charges
• Your cooperation with authorities
• The quality of your legal defense

Even if you weren’t the perpetrator of a crime used to obtain money illegally, you could still be charged with money laundering, such as being charged as part of a conspiracy to commit money laundering. However, if you’re convicted of any other criminal activity at the same time as money laundering, you must serve each prison sentence consecutively.

For example, if a jury were to sentence you to five years in prison for credit card fraud and five years for money laundering, you may have to serve a total of ten years in prison, barring early release.

Do people convicted of money laundering really pay fines up to 500K?

Yes, in some cases, the fines for money laundering can reach hundreds of thousands of dollars. The exact financial repercussions and jail time that come with a conviction will vary depending on the details of your case. For the best possible outcome, it’s crucial to consult a knowledgeable criminal defense lawyer to understand exactly what’s at stake.

In the state of New Jersey, money laundering penalties depend on exactly how much money was involved in the criminal enterprise.

Additional penalties for money laundering in New Jersey

In keeping with New Jersey’s Anti-Money Laundering Profiteering Penalty, if you’re convicted of money laundering, the prosecutor on your case could request additional fines, as follows:

Federal money laundering penalties

Federal money laundering laws don’t supersede New Jersey state laws. If you’re charged with money laundering in New Jersey, you’ll be at risk for the following federal penalties, too:

• 10-20 years in prison
• Fines of up to $500,000 or two times the value of the laundered funds

If the courts deem the money laundering part of a long-term criminal enterprise or terrorism activity, the United States government will tack on additional penalties, depending on the nature of the allegations.

Because the United States federal government considers laundering money in excess of $100,000 an aggravated felony, noncitizens accused of this crime could be detained and subject to deportation proceedings if found guilty.

Who is held accountable in money laundering cases?

It seems obvious that the individual calling the shots in a criminal enterprise should be held accountable in a state or federal money laundering case. Still, such an individual usually doesn’t suffer the consequences alone.

Often, a person who wants to “wash” the assets obtained through illegal activity recruits other people—often called “money mules”—to handle the job. This is called a conspiracy to commit money laundering.

Anyone involved with a money-laundering operation could be held accountable to state and federal money laundering laws, including unwitting money mules. The risk of the severe penalties outlined above is real and pressing, even if you weren’t involved in the original crime or theft itself.

A money-laundering attempt doesn’t even have to be successful for authorities to press charges! If you’ve been accused of money laundering, you need a criminal defense lawyer you can trust.

Seeking trustworthy defense attorneys for money laundering charges

Given the unsettling nature of many of the crimes associated with money laundering, federal and state authorities aren’t exactly sympathetic to individuals accused of the crime. Overzealous authorities sometimes may accuse you of being involved with or benefiting from a criminal enterprise simply because you know someone else who is involved.

On both the state and federal levels, money laundering is a felony conviction. These allegations could affect your life far beyond an initial jail sentence and fines, whether or not you even committed a crime.

For your best chance at avoiding a money laundering conviction, contact a skilled criminal defense attorney as soon as you discover that you’re under investigation.

At Dughi, Hewit, and Domalewski, our experienced team of criminal defense attorneys is well aware of the high stakes involved with these cases. We’re dedicated to minimizing the impact of money laundering allegations on your life.

Contact us today for your consultation.