What is Money Laundering in California?

Under California Penal Code § 186.10, the Money Laundering statute prohibits individuals from engaging in financial transactions that promote, manage, establish, carry on, or facilitate criminal activity.  The financial transaction must  involvie at least one monetary instrument through at least one financial institution.   

Penalties for Money Laundering in California

The penalties for money laundering under California Penal Code § 186.10 include both imprisonment and fines. Specifically, a violation is punishable by:

• Imprisonment: Up to one year in a county jail or imprisonment in state prison.

• Fines: Up to $250,000 or twice the value of the property transacted, whichever is greater.

For subsequent convictions, the maximum fine increases to $500,000 or five times the value of the property transacted, whichever is greater.

Additionally, if the value of the transaction exceeds certain thresholds, mandatory additional imprisonment terms are imposed:

• Transactions over $50,000 but less than $150,000: One additional year.

• Transactions over $2.5 million: Four additional years.

Elements that Must Be Proven

To convict a defendant of money laundering, the prosecutor must prove:

1. Financial Transactions:

   • The defendant conducted or attempted to conduct one or more financial transactions involving at least one monetary instrument through at least one financial institution.

2. Value Threshold:

   • For a single transaction: The financial transaction involved monetary instruments with a total value of more than $5,000.

   • For multiple transactions: Conducted within a seven-day period with monetary instruments totaling more than $5,000 or within a 30-day period totaling more than $25,000.

3. Intent or Knowledge:

   • The defendant intended to promote, manage, establish, carry on, or facilitate criminal activity, or

   • The defendant knew that the monetary instruments represented the proceeds of criminal activity or were derived from such proceeds.

Definitions for the Money Laundering Statute

• Conducting: Includes initiating, participating in, or concluding a transaction.

• Financial Institution: Any national bank or banking institution located or doing business in California.

• Transaction: Includes deposit, withdrawal, transfer, bailment, loan, pledge, payment, or exchange of currency or a monetary instrument, or electronic transfer of funds between accounts by a financial institution.

• Monetary Instrument: Money of the United States or other specified items per Penal Code § 186.9(d).

• Criminal Activity: A criminal offense punishable by death or imprisonment in the state prison under California law, or by imprisonment for over a year in another jurisdiction.

• Foreign Bank Draft: A draft or check issued by a foreign bank or financial institution on an account in the U.S. or a U.S. territory.

Tracing of Criminal Funds

In a prosecution for money laundering under Penal Code § 186.10, the prosecution does not need to prove that every dollar in a transaction was from a crime. They must demonstrate that the illegally obtained funds equal or exceed the amount of the transaction, acknowledging the fungibility of money.

The Best Lawyer to Defend Money Laundering Charges

Daniel Horowitz is a highly rated criminal defense trial lawyer with over 200 jury trials and thousands of evidentiary hearings. He is a former law school professor and television legal commentator. Daniel has handled cases across the U.S., from California to New York, and has appeared in courtrooms in Israel, Cyprus, the Netherlands, and Canada.