Money laundering is one of the most aggressively prosecuted financial crimes in Texas. Both state and federal authorities treat it as a serious threat because it allows individuals and organizations to disguise the profits of illegal activities such as drug trafficking, fraud, and corruption. If convicted, penalties can include lengthy prison sentences, asset forfeiture, and lasting damage to your personal and professional reputation.
In recent years, Texas has seen a rise in money laundering investigations, partly due to the state’s size, international borders, and growing economy. Law enforcement agencies often collaborate with federal prosecutors, using financial surveillance and advanced technology to trace suspicious transactions. Because of this, even legitimate business owners or professionals can find themselves facing allegations of money laundering if their financial activities raise red flags. Understanding the law, and how to defend against these charges with the help of an experienced Houston criminal defense attorney is critical to protecting your rights and future.
What’s Money Laundering?
If you’ve ever asked, “What’s money laundering?” the answer is simple on the surface: it is the process of disguising illegally obtained money so that it appears to come from legitimate sources. The goal is to make “dirty” money generated from unlawful activities, such as drug trafficking, fraud, theft, or organized crime, appear “clean” and usable in the legitimate economy.
Money laundering typically involves three stages: placement (introducing illicit funds into the financial system), layering (concealing the money’s origins through complex transfers), and integration (reintroducing the cleaned money back into the economy as seemingly legal income).
Because it allows criminals to hide the profits of illegal activity and continue operating undetected, both Texas state laws and federal laws impose harsh penalties for those convicted of money laundering.
Texas Money Laundering Laws
In Texas, money laundering is specifically criminalized under Texas Penal Code §34.02, which makes it illegal to knowingly conduct, supervise, or facilitate financial transactions involving the proceeds of criminal activity.
Texas categorizes penalties for money laundering based on the amount of money involved:
- $2,500 – $30,000 (State Jail Felony): A conviction at this level may lead to 180 days to 2 years in a state jail facility, as well as fines of up to $10,000. Even at the lowest threshold, the financial and personal consequences are significant.
- $30,000 – $150,000 (Third-Degree Felony): If the laundered amount falls within this range, penalties increase to 2 to 10 years in prison and fines up to $10,000. The consequences are more severe because the larger sums suggest more complex criminal activity.
- $150,000 – $300,000 (Second-Degree Felony): At this level, a person faces 2 to 20 years in prison along with fines of up to $10,000. Prosecutors take these cases seriously, often pursuing aggressive sentencing.
- Over $300,000 (First-Degree Felony): The most serious category can result in 5 to 99 years, or even life, in prison, plus fines of up to $10,000. Defendants also face permanent loss of assets connected to the case.
In addition to prison time and fines, the state can seize assets, homes, vehicles, and even businesses believed to have been used in or purchased with laundered money.
Federal Money Laundering Laws
At the federal level, money laundering is prosecuted under 18 U.S.C. §§ 1956 & 1957. Federal charges often apply when money crosses state or international borders or when the amount of money is very large. The most common federal violations include:
- Conducting Financial Transactions with Criminal Proceeds: This includes using money obtained from illegal activity to purchase property, transfer funds, or invest in businesses.
- International Money Laundering: Moving money in or out of the U.S. with the intent to hide its illegal source is a federal crime, and cases often involve international banking networks.
- Evading Reporting Requirements: Large transactions are closely monitored, and trying to avoid mandatory reporting thresholds (like structuring deposits under $10,000) can trigger criminal charges.
Federal penalties are severe. Convictions can carry up to 20 years in prison per count, fines of up to $500,000 or twice the value of the funds involved, and asset forfeiture that strips away property and wealth tied to the crime.
Implications of a Money Laundering Conviction
Being convicted of money laundering in Texas or at the federal level has far-reaching consequences that extend beyond prison and fines. The personal, professional, and financial impact can be devastating:
- Asset Forfeiture: The government can seize homes, cars, businesses, and bank accounts believed to be connected to laundered money. Even if not directly tied, assets can be frozen while the case is pending.
- Professional Licenses: Individuals in regulated professions such as law, medicine, accounting, or banking can lose their licenses, effectively ending their careers.
- Employment Barriers: Employers often avoid hiring individuals with a financial crime conviction, making it extremely difficult to secure jobs in the future.
- Immigration Consequences: For non-U.S. citizens, money laundering is considered a serious offense that can lead to deportation, denial of visas, and rejection of citizenship applications.
- Reputation Damage: The stigma of being associated with financial crimes can permanently harm both personal relationships and professional opportunities, even long after the case ends.
Defense Strategies Against Money Laundering Charges
Defending against money laundering charges requires carefully examining both the evidence and how it was obtained. Some common strategies include:
- Lack of Knowledge: A defense lawyer may argue that the defendant did not know the money came from illegal activity. Since prosecutors must prove knowledge, this is often a key defense.
- Insufficient Evidence: Financial records can be complex, and if the prosecution cannot clearly establish intent or trace funds to criminal activity, the case may fall apart.
- Illegal Search and Seizure: If law enforcement obtained bank records, emails, or property without a valid warrant, that evidence may be excluded under constitutional protections.
- Legitimate Source of Funds: The defense may demonstrate that the funds came from lawful business activity or personal income, challenging the prosecution’s claims.
- Entrapment or Government Misconduct: In some cases, undercover agents or investigators may push individuals into transactions they otherwise would not have engaged in. This can be used as a defense.
Each of these defenses requires an experienced conspiracy defense lawyer, who understands both criminal law and financial investigations.
How a Defense Lawyer Can Help in Money Laundering Cases
Facing money laundering charges is overwhelming, but an experienced criminal defense lawyer can provide the protection and advocacy you need. A skilled attorney can:
- Conduct a Thorough Investigation: Reviewing financial documents, tracing money trails, and working with forensic accountants to uncover weaknesses in the state’s case.
- Challenge the Prosecution’s Evidence: Filing motions to exclude illegally obtained evidence or questioning the accuracy of financial records used in the case.
- Negotiate with Prosecutors: In some cases, an attorney may negotiate reduced charges, plea deals, or alternative sentencing options that limit prison time.
- Protect Your Assets: A lawyer can argue against asset forfeiture, working to show that your property was not tied to criminal proceeds.
- Defend You in Court: If the case goes to trial, your lawyer will cross-examine witnesses, challenge the prosecution’s narrative, and present evidence in your defense.
Having the right defense lawyer can make the difference between years in prison and a reduced or dismissed charge.
Anti Money Laundering Compliance
Money laundering doesn’t just affect individuals; it also impacts financial institutions and businesses. To combat it, companies are required to follow strict anti money laundering compliance (AML) measures. These include:
- Customer Due Diligence (CDD): Businesses must verify customer identities and assess risks of criminal activity.
- Suspicious Activity Reports (SARs): Banks and financial institutions are required to file reports if transactions appear unusual or suspicious.
- Transaction Monitoring Systems: Institutions must use monitoring systems to flag patterns of behavior that suggest money laundering.
Failing to comply with AML rules can result in hefty fines, government investigations, and in some cases, criminal liability for company officers.
Consult an Experienced Houston Money Laundering Defense Attorney
Being accused of money laundering in Texas can destroy your future if not handled properly. The government devotes massive resources to investigating financial crimes, and without skilled legal representation, you risk the harshest penalties available.
At Juan L. Guerra, Jr. & Associates (JLG Law), we aggressively defend individuals and businesses accused of money laundering. Our team:
- Analyzes every detail of financial records and transactions.
- Challenges the government’s narrative and exposes weaknesses in their case.
- Protects your rights in both state and federal courts.
- Fights to preserve your freedom, assets, and reputation.
We offer a free, confidential consultation to discuss your case and explore defense options. If you’re facing money laundering charges in Houston or anywhere in Texas, don’t wait, get an experienced Houston money laundering defense lawyer in your corner today.