Written by Zachary Newland, Founding Partner. Last updated August 12, 2026.

Money Laundering Attorney: Federal Charges, Elements, and What You Need to Know

On This Page

• What Is at Stake in a Federal Money Laundering Case
• What Money Laundering Means Under Federal Law
• The Legal Elements the Government Must Prove
• Structuring, Smurfing, and Related Charges
• Penalties for Federal Money Laundering
• What to Do if You Are Under Investigation
• How Evergreen Attorneys Can Help
• Frequently Asked Questions

What Is at Stake in a Federal Money Laundering Case

A federal money laundering investigation can begin quietly: a bank files a suspicious activity report, the IRS Criminal Investigation division issues an administrative subpoena, or a federal agent calls about a business account. By the time most people realize they are under scrutiny, prosecutors may already have months of financial records. A conviction under the primary federal money laundering statute carries up to 20 years in prison, fines that can reach twice the value of the property involved, and civil forfeiture of assets connected to the alleged transactions.

These cases move quickly, and early decisions, especially about what to say and what records to produce, can determine whether charges are filed at all. If you have received a federal grand jury subpoena or a federal target letter related to financial transactions, you should speak with a federal criminal defense attorney before responding.

Call the money laundering defense team at Evergreen Attorneys today at (303) 948-1489 for a free and confidential case evaluation.

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What Money Laundering Means Under Federal Law

Money laundering is not simply moving money. Under federal law, it requires a financial transaction involving proceeds from a “specified unlawful activity” (a defined list of predicate crimes) combined with a specific criminal intent. Congress enacted two primary statutes to address the conduct.

18 U.S.C. § 1956 is the broader statute. It criminalizes conducting or attempting to conduct a financial transaction with proceeds of specified unlawful activity when the defendant knows the property is criminally derived and acts with one of several listed purposes: promoting the underlying crime, concealing or disguising the nature, location, source, ownership, or control of the funds, or avoiding a federal or state transaction reporting requirement.

18 U.S.C. § 1957 is narrower. It targets knowingly engaging in a monetary transaction in criminally derived property worth more than $10,000. Section 1957 does not require proof of the same promotional or concealment intent that § 1956 demands, but it does require proof that the defendant knew the funds came from criminal activity.

The distinction matters for defense purposes. The elements the government must establish, and the defenses available, differ significantly between the two charges.

The Legal Elements the Government Must Prove

Under § 1956, the government must prove each of the following elements beyond a reasonable doubt:

• The defendant conducted or attempted to conduct a financial transaction.
• The transaction involved proceeds of specified unlawful activity.
• The defendant knew the property represented proceeds of some form of unlawful activity.
• The defendant acted with a specific intent to promote the carrying on of the specified unlawful activity, to conceal or disguise the proceeds, or to avoid a transaction reporting requirement.

The term “specified unlawful activity” is a statutory term of art defined in 18 U.S.C. § 1956(c)(7). It includes a broad list of federal and certain state offenses, such as federal fraud crimes, drug trafficking, public corruption, and other serious offenses. The government cannot simply allege that money was “dirty.” It must connect the funds to one of these listed predicate crimes.

Proving criminal intent in federal court is often the contested battleground in a money laundering prosecution. The government typically relies on circumstantial evidence: unusual transaction patterns, structuring of deposits, use of shell entities, rapid movement of funds across accounts, and statements made by the defendant or co-conspirators. A viable defense often centers on demonstrating that the defendant lacked knowledge of the criminal origin of the funds or lacked the specific intent the statute requires.

Structuring, Smurfing, and Related Charges

Structuring and smurfing charges frequently accompany or precede money laundering allegations. Federal law requires financial institutions to file Currency Transaction Reports (CTRs) for cash transactions exceeding $10,000. Structuring means breaking up transactions into smaller amounts specifically to avoid triggering that reporting threshold.

Structuring is a separate federal offense under 31 U.S.C. § 5324. It does not require proof that the underlying money was criminally derived. The government only needs to show that the defendant intentionally structured transactions to evade reporting requirements. “Smurfing” refers to using multiple people to conduct structured transactions, and it can result in conspiracy charges on top of the structuring offense. See https://www.fraud.com/post/smurfing

An IRS criminal investigation subpoena for bank records is a common early step in both structuring and money laundering investigations. Banks also independently flag suspicious patterns through Suspicious Activity Reports (SARs) filed with the Financial Crimes Enforcement Network (FinCEN), which can trigger a broader federal investigation involving the FBI, IRS-CI, or DEA.

Penalties for Federal Money Laundering

The penalties for a federal money laundering conviction are severe:

• § 1956: Up to 20 years in prison and a fine of up to $500,000 or twice the value of the property involved in the transaction, whichever is greater.
• § 1957: Up to 10 years in prison, with substantial fines and forfeiture exposure.
• Forfeiture: The government can seek civil and criminal forfeiture of property involved in or traceable to the offense, including real estate, vehicles, bank accounts, and business assets.
• Restitution and collateral consequences: A conviction can also trigger professional licensing consequences, immigration consequences for non-citizens, and restitution obligations.

Actual sentencing depends on the U.S. Sentencing Guidelines calculation, the amount of money involved, the nature of the predicate offense, and the defendant’s criminal history. Cases prosecuted in the U.S. District Court for the District of Colorado and other federal districts follow these same statutory frameworks.

What to Do if You Are Under Investigation

If you have reason to believe you are under federal investigation for money laundering, structuring, or a related financial crime, take the following steps:

1. Do not speak with federal agents, IRS-CI investigators, or any law enforcement officer about the substance of the investigation without first consulting a federal criminal defense attorney.
2. Do not destroy, alter, or conceal financial records, emails, or other documents. Doing so can result in separate obstruction charges.
3. Identify and preserve all financial records, business documents, and communications that may be relevant to the transactions at issue.
4. If you have received a subpoena or document request, do not produce anything until counsel has reviewed the scope and legal basis of the demand.
5. Contact a federal defense attorney who handles white collar crime defense to evaluate your exposure and develop a strategy before the government’s case advances further.

How Evergreen Attorneys Can Help Your Money Laundering Case

Evergreen Attorneys represents individuals, professionals, and business owners facing federal money laundering investigations and charges.

• Evergreen Attorneys exclusively focuses on federal criminal defense
• Evergreen Attorneys staffs every case with at least one partner as lead counsel
• Evergreen Attorneys intentionally keeps their caseload small to deliver the highest quality service.

In a money laundering matter, the firm analyzes the statute the government appears to be pursuing, evaluates the strength of the evidence on knowledge and intent, reviews the financial records and transaction history for gaps in the government’s theory, and identifies viable defenses before charges are filed or the case moves toward trial. Because money laundering charges often arise alongside other federal allegations, such as fraud, drug offenses, or conspiracy, Evergreen Attorneys also assesses the full scope of potential exposure across related counts.

Zachary Newland, the firm’s Founding Partner, has appeared as counsel of record in more than 130 federal cases since 2016 and has experience handling complex financial investigations from the earliest stages through trial.

Frequently Asked Questions

What is money laundering under federal law?

Under federal law, money laundering means conducting a financial transaction with proceeds from a specified unlawful activity while knowing the money is criminally derived and intending to promote the underlying crime, conceal the funds, or avoid a reporting requirement. The core statute is 18 U.S.C. § 1956. Congress also created 18 U.S.C. § 1957 to cover certain monetary transactions involving more than $10,000 in criminal proceeds. The government must prove all of the statutory elements, not merely that money moved through accounts.

What are the penalties for federal money laundering charges?

Section 1956 carries a maximum penalty of 20 years in prison and a fine of up to $500,000 or twice the value of the property involved, whichever is greater. Section 1957 carries a maximum penalty of 10 years in prison and can also involve substantial fines and asset forfeiture. Actual sentencing depends on the statute charged, the amount involved, the Sentencing Guidelines calculation, and the facts the government can prove at trial or through a plea.

How is 18 U.S.C. § 1956 different from 18 U.S.C. § 1957?

Section 1956 is the broader money laundering statute. It covers financial transactions conducted with proceeds of specified unlawful activity and one of several listed intents, including promotion of the crime, concealment of the proceeds, or avoidance of reporting requirements. Section 1957 is narrower and focuses on knowingly engaging in a monetary transaction in criminally derived property worth more than $10,000. Because the elements differ, the defense analysis for each charge is distinct, and the potential penalties also differ.

What are the three stages of money laundering?

The FBI and other federal agencies describe money laundering as moving illicit proceeds through three stages: placement (introducing the money into the financial system), layering (moving it through multiple transactions to obscure its source), and integration (reintroducing it as apparently legitimate funds). These stages are useful for understanding the conduct that investigators look for, but a federal charge still depends on the specific elements in the statute the government uses, not simply on whether money passed through these stages.

When should a person or business involve federal defense counsel in a money laundering matter?

You should involve counsel as soon as you have any indication of federal scrutiny: a bank notifying you of an account freeze or closure, contact from an IRS-CI agent or FBI agent, receipt of a grand jury subpoena for financial records, or a target letter from a U.S. Attorney’s Office. Early involvement of experienced federal defense counsel can preserve defenses, prevent inadvertent admissions, and position you to respond strategically before the government’s case is locked in.

If you are facing a federal money laundering investigation or charges, contact Evergreen Attorneys at (303) 948-1489 for a confidential case evaluation with a federal criminal defense lawyer today.