money laundering

Humberto Cuellar was convicted of international money laundering after officers found large sums of illegal money hidden in a vehicle Cuellar intended to drive across the U.S. border into Mexico. A jury found Cuellar guilty under 18 U.S.C. � 1956(a)(2)(B)(i), which makes money laundering a federal crime. An en banc panel of the U.S. Court of Appeals, Fifth Circuit, affirmed Cuellar's conviction and Cuellar appealed. In this case, U.S. Supreme Court will determine whether an attempt to create the appearance of legitimate wealth is necessary to support a money laundering conviction. Cuellar argues that his conviction cannot stand because he did not attempt to create the appearance of legitimate funds. The United States argues that a money laundering conviction is appropriate if a criminal defendant physically concealed illegal funds during cross-border transportation. The Court's decision will resolve the current circuit split and clarify the scope of the federal money laundering statute.

Questions as Framed for the Court by the Parties

Issues

Efrain Santos was convicted in Indiana federal court of running an illegal gambling business and money laundering. He presented a collateral attack against his conviction following the Seventh Circuit’s decision in another case, where it held that to prove money laundering, the government is required to show that profits from the underlying illegal activity were used to further promote or conceal that activity. Because Santos’s conviction was based on evidence that he used gross receipts, not profits, to promote his gambling ring, the District Court overturned his money laundering conviction. The Seventh Circuit upheld that decision, and the government appealed, contending that to secure a conviction it is only required to prove that gross receipts are used in a money laundering scheme. The government argues that statutory interpretation and practical enforcement considerations mandate a reading that “proceeds” means gross receipts, and Santos responds that in light of the fact that “proceeds” is not defined within the statute, the rule of lenity requires the Court to uphold the Seventh Circuit’s more restrictive reading of the term as profits. The outcome of this case will affect money laundering prosecutions tied to a wide variety of illegal activities and will affect the government’s burden in proving the elements of this charge.

Questions as Framed for the Court by the Parties

Additional Resources