Money Laundering Basics: What Is It And What Are Its Penalties?

You’ve been hearing the term money laundering for quite some time now. Because of the media, you’ve known that this is a crime and that different people all over the world have been penalized because of money laundering. But aside from the things you hear and see, you don’t know anything else about money laundering. You just know that it’s something that should not be done because once you do it, you’ll have a problem with the law.

To give you more idea about money laundering and the penalties involved in this crime, let this article help you.

But First, What Is Money Laundering?

At its core, money laundering is a way to conceal illegally obtained funds. This process involves transferring money in complicated and elaborate transactions which can mislead anyone who would want to trace or review these transactions. The main objective of money laundering is to make it difficult for external parties to identify who was originally in charge of the transaction, also known as the launderer. At the end of this complicated scheme, the money returns to the launderer in the full amount.

Money laundering can take form in many ways and commonly, money launderers use shell companies to accomplish their scheme. Shell companies look like legitimate companies and would seem like they function as a real business, but in actuality, everything is just a facade to fool the public who are looking at the business in a macro level. Shell companies look like an established business, but these are actually funded by illegal activities. For example, a company dealing with illegal drugs could be the source of funding for a shell restaurant business. The restaurant might have financial records with inflated entries that reflect money from drug dealing instead of the restaurant business. This means that the restaurant served to launder the illegal monies involved in illegal drugs.

What Are The Penalties Of Money Laundering?

Different states have different penalties when it comes to money laundering offenses. Generally, money laundering results in fines, prison, probation or a combination of any of these penalties. To know more about the penalties associated with money laundering, read on below:

  • Fines. Misdemeanor convictions will require you to pay a few thousand dollars while a federal conviction can result in fines up to $500,000 or double the amount of money that was involved in the scheme, whichever is higher.
  • Probation. When you are convicted of money laundering, you can be imposed with a probation sentence which can be anywhere from one year to three years.
  • Prison. Some states consider money laundering as a felony offense while some, as a misdemeanor charge. Felony convictions can have penalties of at least one year in prison, and a misdemeanor conviction for money laundering can result in a jail sentence of up to one year.

All of the information presented in this article is more than enough to tell that you money laundering is indeed a serious crime. If you have been accused of such without any valid reason or strong pieces of evidence, seek the help of an experienced defense lawyer who has years of experience in handling money laundering cases, like this one here. They are the best people to defend you in any lawsuits involving money laundering and even structuring.

In Conclusion

It’s essential to know what money laundering is. Once you know what this term means and all the processes involved, you’d be more aware about what you do on a daily basis – you don’t want your hard-earned money to be associated with any money laundering acts, right?  If you also have adequate information about money laundering, it’ll be easier for you to report the people involved in the act. You’d know now how to better handle this kind of situation if you’re faced with it in the future.