Introduction
A money laundering charge is serious and can result in harsh penalties if convicted. There are three degrees of money laundering, and each has its own penalties, ranging from two to 12 and a half years in prison.
It’s important to note that money laundering is considered both a crime in Arizona and a federal crime. As a result, someone who commits money laundering can be charged under Arizona state law as well as the federal penal code.
If you have been charged with Arizona money laundering, it’s important to understand the potential consequences you may face as well as the possible defenses you can use in your favor. Finding a criminal defense attorney who can support you in the process is crucial for attempting to reduce your charges and protect you from harsh penalties that can stick with you for life.
What is Money Laundering?
Money laundering is a financial scheme where an individual gains money from a criminal act and follows a process to cover up the receipt of financial resources by making them appear to come from legal sources. One of the most common criminal acts used for money laundering is tax evasion—money laundering is also commonly associated with drug crimes, credit card fraud, trafficking, and terrorism activities.
The money laundering process is often a complex one that involves three parts:
- The launderer gains money from an illegal activity.
- The launderer puts the money through a scheme to hide a criminal act.
- The money is returned to the launderer.
Often, perpetrators carry out money laundering through the use of shell companies, which are fake companies where launderers can set up accounts to deposit and withdraw money. The term “laundering” is used because these schemes attempt to make money from illegal (a.k.a. dirty) activities while presenting that the profits were gained from legal (a.k.a. clean) activities. Money laundering is considered a white-collar crime.
To convict someone for money laundering, the prosecution must prove all of the following points:
- The individual was involved in an unlawful activity.
- They were aware that the money or goods were from unlawful activities or were going to be used in unlawful activities.
- They had the intention to hide or conceal the money from the law and other sources either directly or by influencing others.
Money Laundering is a Federal Crime
Money laundering is a felony on both a state and federal level. Under the Money Laundering Control Act of 1986, money laundering is considered a federal crime. There are two sections to this law.
The first is 18 U.S. Code § 1956, which states that anyone who has committed money laundering can receive a fine of up to $500,000, or two times the value of the laundered funds, and/or up to twenty years in prison.
The second section is 18 U.S. Code § 1957, which states that if the criminal activity resulted in more than $10,000, the punishment is either a fine, imprisonment of up to 10 years, or a combination of the two.
Federal money laundering is usually investigated by the FBI, IRS, or the Department of Justice. If convicted of money laundering on a federal level, you can face both state and federal charges. In cases where money laundering is tied to a long-term criminal enterprise or terrorism activity, the government may add additional, harsher penalties.
Money Laundering: Arizona Laws & Penalties
Arizona law covers money laundering under statute A.R.S. 13-2317. This statute distinguishes whether someone is guilty of money laundering in the first, second, or third degree. The type of charge depends on the nature of the crime, and each comes with its own consequences.
First-Degree Money Laundering
An individual is charged in the first degree if they’re accused of knowingly initiating, organizing, managing, and or directing the scheme. This is a class two felony that is punishable by 12.5 years in prison for first-time offenders. First-degree money laundering has the harshest penalties due to the nature of the crime.
Essentially, a first-degree money laundering charge is provided to the person who was the boss or leader of the operation. First-degree money laundering is also applicable if a person facilitates terrorism or murder.
Second-Degree Money Laundering
An individual is likely to be charged with second-degree money laundering if they’re accused of maintaining an interest in money laundering operations, making property available, providing false information to the government, or transmitting money. Second-degree money laundering is a class three felony with 8.75 years imprisonment for first-time offenders.
Second-degree money laundering is the most common offense of the three, as it is also the most comprehensive under Arizona law. This area covers multiple aspects of making money through illegal means and concealing that means as legitimate earnings.
A crime is considered second-degree money laundering when an individual:
- Acquires, maintains, transacts, receives, or conceals racketeering materials knowing that they are the proceeds of illegal activity
- Makes property available to others knowing that it’s intended to be used for racketeering
- Conducts a transaction with money or property knowing that it is the proceeds of an offense with an intent to conceal the property’s nature, location, source, ownership, or control.
- Intentionally or knowingly covers up, conceals, or attempts to conceal the identity of anyone involved in money laundering transactions.
- Knowingly evades or attempts to evade financial reporting requirements established by Title 6, chapter 12 of Arizona state law.
- Intentionally makes or attempts to create a forged document that contains any false personally identifying information.
Third-Degree Money Laundering
A person is accused of third-degree money laundering if they’re responsible for helping transmit money for the scheme in any capacity. A person would be charged with third-degree money laundering if they knowingly either influence somebody or cooperate with someone to avoid reporting monetary transactions in accordance with Title 6, chapter 12 of Arizona law.
Third-degree money laundering is a class six felony that is punishable with up to two years in prison for first-time offenders.
Possible Money Laundering Defenses
Because the prosecution must prove several points in order to justify a conviction, they must meet a high standard to convict a defendant of money laundering. As a result, there are several defenses someone can use if they are charged.
The following are some of the most common potential defenses against a money laundering charge:
- Lack of knowledge – The defense may be able to argue that you didn’t know the laundered money or goods came from unlawful means. If you can provide evidence that you were not aware of the criminal activity, you have a strong chance to be acquitted.
- Lack of intent – Another defense alongside lack of knowledge is lack of intent, which is a key element to a money laundering crime. If there is no evidence that you intended to launder money, there is potential to be acquitted of the crime.
- Entrapment – Evidence acquired through entrapment is inadmissible in court. If law enforcement uses inappropriate methods to trick you or gather evidence against you, the defense may be able to have the evidence dropped.
- Duress – In some cases, people can use the defense that they were forced to engage in money laundering because of a threat against them or a loved one. However, this defense requires sufficient evidence to indicate that you were forced into money laundering against your will.
- Legitimate earnings – A key element of money laundering is that the money was obtained through illegal means. If you can prove that you earned the money legitimately, you can increase your chances of an acquittal.
In addition to these defenses, there is also the potential that the act was not actually money laundering. Sometimes, the act of money laundering is confused with other charges, like tax evasion or racketeering. The defendant’s side may also be able to argue that the other side did not accurately calculate the amount of money laundered in order to receive a charge with fewer consequences.
There are multiple ways to dispute a money laundering charge. Ultimately, though, the strength of your defense depends largely on having a skilled and experienced criminal defense attorney. An attorney plays an integral role in tracing the history of transactions and related documents while crafting a formidable argument to defend against a money laundering charge.
Accused of Money Laundering in Arizona?
A money laundering charge is a severe charge that can carry consequences that will stay on your record for years to come. Fortunately, there are several potential defenses you can use to increase your chances of an acquittal, depending on the nature of your case.
To protect yourself against potentially harsh penalties, it’s important to have an experienced criminal defense attorney by your side for any fraud-related charges. If you’re charged with money laundering in Arizona, contact JacksonWhite’s criminal defense team for experienced representation.
Call the JacksonWhite Criminal Law team at (480) 418-4281 to discuss your case today.
