Many people hear the words “money laundering” and think of Al Capone, the mob, and 1920s bootlegging operations. It’s true—the term is much more likely to evoke a certain aesthetic in the minds of people than an actual understanding of the crime itself.
The giveaway is actually in the name. Money laundering is the act of concealing or obscuring the monetary proceeds from illegal operations (such as drug trafficking or extortion), which gives the appearance of cleaning dirty money. The classic money laundering scheme consists of three main actions: placement, layering, and integration.
Placement
The first thing money launderers do with ill-gotten gains is place the funds into an otherwise legitimate institution (most often banks). Launderers sometimes obscure the dirty money by “smurfing” the funds. Smurfing refers to depositing the money in smaller chunks so as to avoid suspicion. Monetary transfers of $10,000 or more must be reported to the government, so launderers deposit amounts just under the $10,000 threshold.
Layering
In this step, ill-gotten money is swapped around the macro economy to further obscure the underlying crimes. This phase is where the majority of the actual “laundering” gets done. A person might layer the money by exchanging it for casino chips and cashing out after only playing a few games of blackjack. Other times, the offender might purchase jewelry, art, gold, and other precious goods. Many money launderers also funnel the dirty money through foreign financial institutions.
Integration
The third and final phase of money laundering involves the offenders deciding where to park the money. Some launderers “invest” the money into or through shell corporations. Other times, the laundered money gets used to start cash-intensive businesses like laundromats and hair salons. Ultimately, money laundering is done to prevent tax evasion; these two crimes almost always dovetail with each other.
Texas Laws on Money Laundering
In Texas, you can be charged with money laundering even if you only had minimal interaction with ill-gotten money. Furthermore, you don’t necessarily have to know all the details about the underlying crimes that produced the money to be charged.
Money Laundering Penalties
Money laundering is always a felony in Texas. The severity of punishment depends on the amount of money involved. State money laundering charges involving more than $300,000 is a first-degree felony, and the charges lessen in severity starting at that threshold and going down. Recently, the state legislature passed a law that added cryptocurrency to the money laundering statutes.
A normal, routine criminal defense attorney is often insufficient for complex, white collar charges like money laundering. Our firm has decades of proven success in state and federal courtrooms, and we never forget about protecting your rights at all costs. Call us today at (713) 227-4100 to see how we can help defend against charges of money laundering and conspiracy to commit money laundering.
The Law Offices of Charles A. Banker, III
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