MASSBAR
The National Trial Lawyers

Money Laundering

Money laundering is a crime most often associated with a federal prosecution, but Massachusetts has its own money laundering statute that can be prosecuted in state court. Money laundering is a felony in Massachusetts that carries the possibility of a six-year state prison sentence, a large fine, and the forfeiture of the property that was used in the laundering scheme.

There are three theories of prosecution under the money laundering statute. A person can be convicted of money laundering by:

  1. Possessing or transporting a monetary instrument (which includes cash, stocks, bank checks, cashier’s checks, money orders, traveler’s checks, debit cards, credit cards, gift certificates, or jewels) that derived from criminal activity while intending to facilitate or promote further criminal activity; or
  2. Engaging in a transaction involving a monetary instrument that derived from criminal activity: (a) while intending to facilitate or promote further criminal activity; or (b) knowing the transaction is intended to hide the illegally-obtained property or avoid a transaction reporting requirement; or
  3. Supervising, directing, financing, organizing, planning, managing, or controlling the transactions in, or transportation of, monetary instruments that the defendant knew or should have known were derived from criminal activity.

It’s a confusing statute, but ultimately a person is guilty by using dirty money to facilitate additional criminal conduct or by trying to hide dirty money. Money laundering is often charged along with other crimes, because the defendant is usually involved in the criminal conduct that resulted in the money being laundered. For example, defendants charged with money laundering are sometimes charged with larceny for stealing the money, or other crimes that resulted in the person possessing the dirty money (such as drug dealing or human trafficking).

Common Defense Strategies
  • Knowledge – If the defendant did not know the money he possessed or transported was the product of crime, he is not guilty of money laundering (unless he was willfully blind about the source of the money). For example, if a drug dealer gave the proceeds of a drug deal to his girlfriend, and the girlfriend didn’t know where the money came from, she likely cannot be convicted of money laundering regardless of what she does with the money.
  • Intent – In order to be convicted of money laundering, the defendant must have a criminal intent. The Commonwealth must prove beyond a reasonable doubt that the defendant’s actions in handling the money were designed to either commit additional crimes or hide the money.
    • As with any crime, intent can be proved by circumstantial evidence. Suppose a defendant received $45,000 in income but decided not to declare the money to the Internal Revenue Service (thereby committing the crime of tax evasion). Instead of depositing the entire $45,000 into a single bank account, the defendant made deposits of $9,000 each to five different bank accounts. The Commonwealth would have a strong circumstantial case that the defendant committed money laundering by attempting to hide the illegal money for the following reason: any bank transaction of $10,000 or more is required to be reported to the federal government. By making deposits of just under $10,000, the defendant has structured the transactions to avoid the reporting requirement (and hoping the government will never become aware of the money). Unless the defendant has a really good reason for making five $9,000 deposits instead of one $45,000 deposit, a jury will conclude he was attempting to hide dirty money and convict him of money laundering.

Money laundering cases often involve complex financial transactions and should be handled by experienced criminal defense attorneys.

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