Anti-Money Laundering

Maryland Tax Attorney – Money Laundering

Money laundering is a term used to describe financial transactions and other activities that are used to create the appearance that illegally obtained money originated from a legitimate source. Money laundering crimes tend to be quite complex, involving multiple financial transactions and outlets often across the world. According to the United States Treasury Department, money laundering has three basic components: placement, layering and integration. First, the illegally gained money (“dirty money”) is placed into the legitimate financial system. Next, the illegal source of the funds is concealed by using layers of complex transactions. Finally, the funds are integrated into the financial system by way of additional transactions to make the dirty money appear legitimate or clean.

Money Laundering Investigations

The Internal Revenue Service explains that “money laundering is tax evasion in progress.” Criminals use money laundering as a means to evade paying taxes on illegal income by hiding the source of the income. The government is serious about uncovering and combatting money laundering activities with the IRS stating that money laundering activities create an “underground, untaxed economy” that threatens our economy and erodes our financial systems.

The process of detecting and investigating crimes that involve numerous financial transactions is often referred to as “following the money trail.” The IRS is a key agency responsible for conducting money laundering investigations. These criminal investigations primarily target criminal activities where the underlying conduct violates federal income tax laws or the Currency and Foreign Transactions Reporting Act of 1970 (commonly known as the Bank Secrecy Act or BSA). The Bank Secrecy Act introduced a number of different reporting requirements, including the Currency Transaction Report (CTR), the Report of International Transportation of Currency or Monetary Instruments (CMIR) and the Report of Foreign and Financial Accounts (FBAR). These reports help to create the paper trail investigators need to detect, follow and dismantle the millions of dollars that are being laundered through financial institutions.

Pursuant to the Bank Secrecy Act, financial institutions are required to assist the federal government in identifying and preventing money laundering money activities. Specifically, financial institutions must report suspicious activities that might indicate money laundering crimes to the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) under a Suspicious Activity Report (SAR). Financial institutions that fail to properly file SARs face serious consequences, including civil and criminal penalties, regulatory enforcement actions, and possible license or charter revocation.

Schedule a Consultation with Thorn Law Group

If you are an individual accused of a money laundering crime or are a financial institution with questions or concerns about the anti-money laundering requirements, contact Thorn Law Group today. Thorn Law Group is a premier tax law firm advising and representing clients in Maryland, across the United States and abroad dealing with complex civil and criminal tax law matters. We are very familiar with the laws addressing money laundering activities and will work Certified Anti-Money Laundering Specialists, Certified Fraud Examiners and other money laundering investigators to analyze your case and build a strong defense.

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