California Health & Safety 11370.9
HSC 11370.9 – Money Laundering with Proceeds of Drug Crimes
Money Laundering with Proceeds of Drug Crimes – Table of Contents
- HSC 11370.9 Overview
- HSC 11370.9 Elements
- HSC 11370.9 Sentencing
- HSC 11370.9 Defenses
- HSC 11370.9 Retain Lawyer
California Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9 deals with the specific crime of laundering money that came from the profits of drug crimes. Before delving into this narrower topic, it is important to first understand money laundering more generally. California Penal Code 186.10 deals with the broad crime category of money laundering in general. As noted in the Judicial Council of California’s Jury Instructions, money laundering is when an individual engages in the following activities in conjunction with one another:
- Attempts or successfully conducts a bank transaction;
- The bank transaction, or series of transactions, involve a total value of more than $5,000 in a seven-day period, or more than $25,000 in a 30-day period; AND
- The transactions are performed with either the intent to promote criminal activity or with the knowledge that the money is the product of criminal activity.
Now that we have this foundational understanding of money laundering in general, it is time to examine the narrower crime elucidated in California Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9, or money laundering involving illicit drugs. California Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9(a) states:
It is unlawful for any person knowingly to receive or acquire proceeds, or engage in a transaction involving proceeds, known to be derived from any violation of this division or Division 10.1 with the intent to conceal or disguise or aid in concealing or disguising the nature, location, ownership, control, or source of the proceeds or to avoid a transaction reporting requirement under state or federal law.
Additionally, California Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9(f) adds, “This section shall apply only to a transaction, or series of related transactions within a 30-day period, involving over twenty-five thousand dollars ($25,000) or to proceeds of a value exceeding twenty-five thousand dollars ($25,000).”
As the official definition contains fairly technical terminology, it is important to break this language down into its constituent parts. Essentially what is being said is that money laundering involving the proceeds of drugs crimes is when the following elements are present:
- An individual received, acquired, or engaged in a transaction involving proceeds known to be derived from a controlled substance offense;
- The individual did so because they intended to conceal, disguise, or aid in the concealing or disguising of the nature, location, ownership, control, or source of the money or property proceeds; AND
- The amount in question was in excess of $25,000 in a 30-day period.
As seen in most other criminal offenses in California, one of the key components involved in prosecuting this offense is to establish knowledge and intent on the part of the accused individual. Without the presence of both of these factors, even if the correct amount of money is in fact being used in the transaction, it cannot be deemed a violation of California’s Health and Safety Code 11370.9.
First, when looking to knowledge, the first element states that the accused individual needs to know that the money or property was derived from a controlled substance offense. If the individual does not possess this knowledge, or is mistaken about its origins, then they cannot be said to be guilty of this offense. This line of thinking derives from the term mens rea, a Latin phrase which literally translates to guilty mind. In addition to the physical act, most crimes require that an individual also possess an intention or knowledge of wrongdoing in order to substantiate a finding of guilt.
As mens rea also deals with intention, this legal principal also deals with the second enumerated element then of the individual intending to conceal or disguise the source, ownership, or control of the money. So, unless this intention can be effectively and persuasively demonstrated by the prosecution, an individual is not in violation of California’s Health and Safety Code § 11370.9.
California’s Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9 is what is known as a “wobbler” offense, meaning that it is something that can either be charged as a felony or a misdemeanor depending on the specific facts of the situation at hand and also the individual’s previous criminal history, if any.
If the California Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9 violation is charged as a misdemeanor, the individual will be facing incarceration of up to one year in county jail and a monetary fine of up to $1,000.
If however, the offense is determined to be a felony and charged as such, the individual will be facing a significantly harsher reality. The incarceration penalty for a felony offense jumps up to two, three, or four years in state prison. In addition, the monetary consequences also increase dramatically, jumping from at most $1,000 for a misdemeanor to up to the larger of $250,000 or twice the amount of the money that was laundered.
Needless to say, the consequences of being found guilty of violating California’s Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9 are steep, especially if it is deemed to be a felony offense. As such, it is important to examine the possible effective defenses available to an individual who finds themselves in this predicament.
Like with any charge or allegation of engaging in a criminal act, there are a number of potential defenses at an individual’s disposal. However, determining which of these available defenses is most likely to prove effective is something that a skilled criminal defense attorney can help with. Therefore, the first step an individual should take if they find themselves facing a charge of money laundering is to hire a skilled criminal defense attorney. After that, the following three defenses are important to keep in mind as well.
The first defense revolves around knowledge and intent. Given HSC 11370.9’s heavy reliance on two factors related to mens rea, attacking both of these elements is most likely going to prove to be one of the more effective ways to mount a defense. As noted above, in order to be convicted of violating California’s Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9, an individual needs to have the intention of hiding the source, ownership, or control of the money involved in the transaction. It is the prosecutor’s responsibility to demonstrate that the individual did in fact intend to conceal the source through the transaction in question. Similarly, the individual also must actively know that the source of the money in question is related to illicit drugs. The prosecutor must also prove that the individual possessed this knowledge. If either of these elements cannot be demonstrated by the prosecutor, or if information demonstrating the opposite can effectively be demonstrated by the defense, then the individual cannot be found guilty of violating California’s Health and Safety Code 11370.9.
A second key defense involves the third element of Money Laundering with Proceeds of Drug Crimes: $25,000 worth of transactions in a 30-day period. Given the strict specificity laid out in California’s Health and Safety Code § 11370.9, any amount falling short of this, or any duration taking longer than this, means that an individual is not guilty of this offense. For example, even if an individual took $24,500 in cash that they knew came from selling cocaine, bought gold with this cash with the intention of hiding the origins of it, they cannot be found guilty of violating California’s Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9. Similarly, if an individual took $30,000 they earned selling crystal meth and invested it in stocks through purchases of $5,000 at a time over a two-month period, so long as $25,000 of this $30,000 was not invested in any 300-day period within that two months, they cannot be found guilty of violating California’s Health and Safety Code § 11370.9. In addition to these technicalities, the prosecutor must also show that the money involved in the transaction actually came from the illegal source. So, for example, if an individual is engaged in financial transactions for an amount over $25,000, but that individual makes some money from selling drugs and some from legally driving people around through a rideshare app, it is the prosecutor’s job to establish that a sufficient amount of the money involved in the transaction came from the illegal activity.
A third effective defense to employ involves attacking the police conduct. Since law enforcement operations attempting to uncover illegal drug trafficking and sale operations often involve complex, long-term investigations, there is a higher possibility that an officer infringed on an individual’s constitutional rights. So, whether this involves illegal wiretapping or illegal search and seizure, investigating every aspect of the police investigation tactics is often times an effective way to uncover misconduct. If evidence of misconduct is discovered, then a criminal defense attorney can file a motion to suppress evidence. These motions, if successful, often lead to casers being thrown out due to lack of evidence.
If you or a loved one has been charged with California Health and Safety Code Money Laundering with Proceeds of Drug Crimes, HSC 11370.9, laundering money associated with the proceeds of drug crimes in the Southern California area, we invite you to contact our Los Angeles Criminal Defense Attorneys immediately for a free case review.
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