Money laundering is a complex white-collar crime. It involves intentionally falsifying information about the origins of someone’s financial resources. Typically, a business capable of securing a legitimate source of income cooperates with those who have illicit funds to make them appear legitimate.
For example, funneling money obtained by selling drugs on the unregulated market through a convenience store can make the money look like legal, taxed income. Investigators may have a hard time identifying which businesses help those involved in regular criminal activity legitimize their funds.
Those accused of money laundering often face white-collar criminal charges, frequently at the federal level. Recently, there has been a concerted effort to crack down on money laundering because of the association between money laundering, organized crime and terrorism.
What have federal lawmakers done?
There have been several laws passed in recent years aimed at curtailing money laundering within the United States. The Corporate Transparency Act requires that businesses now file reports with federal regulatory authorities about who has a beneficial ownership interest in the company.
These disclosures may help the federal government correlate two seemingly unrelated businesses and potentially identify patterns that might indicate money laundering. There was also the Anti-Money Laundering Act of 2020, a federal law that expands on existing anti-money laundering rules. The Act, in part, made it a crime to misrepresent where one obtained the funds used to conduct a sizable transaction.
Those accused of a money laundering offense could be at risk of incarceration, financial penalties and a criminal record that could limit their opportunities in the future. Tracking changes in federal laws can help people avoid mistakes that might lead to unnecessary prosecution.