Proposals to Reform the Federal Money Laundering Statutes
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blurred the evidentiary requirements for establishing money laundering. As interpreted and applied, the current law is a cruel trap for unwary individuals and businesses that inflicts felony convictions, draconian and inflexible prison sentences 2 , and ruinous asset forfeiture. 3
As Deputy Attorney General Larry Thompson stated,
The Anti-Money Laundering Statutes are overly broad because they potentially reach many legitimate business transactions. The result is that businesses are subject to overreaching investigations and prosecutions for conduct unrelated to drug trafficking or organized crime. These investigations and prosecutions are extremely disruptive for business and expensive to defend.
Elizabeth Johnson & Larry Thompson, Money Laundering: Business Beware, 44 Ala. L. Rev. 703, 719 (1993).
Laundering Campaign Hits New Targets, 3 No. 3 DOJ Alert 4, March 1993 (describing increased money laundering exposure of otherwise legitimate businesses, especially leasing companies, real estate brokers, and retailers). 2 Section 1956 provides for a sentence of up to twenty years, and a fine of the greater of $500,000 or twice the value of the property involved in the transaction. Section 1957 provides for a sentence of up to ten years, and includes the potential imposition of substantial fines as well. Both sections trigger severe sentences under the United States Sentencing Guidelines. 3 Money laundering offenses trigger the broad forfeiture provisions of 18 U.S.C. § 982, which gives prosecutors the authority to seize any property “ involved in ” or “ traceable ” to the alleged offense. This means that prosecutors can seize an entire business, bank account or other asset with little regard for the nature or magnitude of the money laundering activity. A money laundering prosecution also gives prosecutors the power to use seizure warrants, seek protective orders and confiscate substitute assets.
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