U.S. Supreme Court
Supreme Court Rules Transporting Money Is Not Money Laundering
Posted Jun 2, 2008 10:27 AM CDT
By Debra Cassens Weiss
The U.S. Supreme Court has ruled that transporting hidden money does not amount to the crime of money laundering, in one of two cases interpreting the statute decided today against the federal government.
The court ruled in a unanimous decision (PDF posted by SCOTUSblog) that hiding money under the floorboards of a car headed for the Mexican border was not a violation of the money-laundering law, the Associated Press reports.
Justice Clarence Thomas wrote that the statute does not require proof the defendant tried to “legitimize” tainted funds, but “the government must demonstrate the defendant did more than merely hide the money during its transport.” The case is Cuellar v. United States.
In the second case, the court ruled 5-4 that the money-laundering statute applies to the profits of an illegal operation, not the gross receipts. The Chicago-based 7th U.S. Circuit Court of Appeals had ruled the law didn’t apply to an illicit lottery that spent its proceeds on operating expenses.
At issue was whether the money laundering statute’s reference to “proceeds” referred to “receipts” or “profits,” Justice Antonin Scalia wrote in the majority opinion (PDF posted by SCOTUSblog).
"From the face of the statute, there is no more reason to think that ‘proceeds’ means ‘receipts’ than there is to think that ‘proceeds’ means 'profits,’ ” Scalia wrote. “Under a long line of our decisions, the tie must go to the defendant.” The case is U.S. v. Santos.
SCOTUSblog reports that the controlling opinion in Santos was a concurrence written by John Paul Stevens. The blog says the court's eight other justices all rejected the legal distinctions made by Stevens, who may have first sided with the dissenters but changed his vote along the way.
Scalia addressed Stevens' opinion, writing that it confines the majority to this narrow holding: “Proceeds” means “profits” when there is no legislative history to the contrary.
"That is all that our judgment holds," Scalia writes. "It does not hold that the outcome is different when contrary legislative history does exist. Justice Stevens' speculations on that point address a case that is not before him, are the purest of dicta, and form no part of today’s holding."
Stevens rebuts Scalia's assertion. "That is not correct," he writes. "My conclusion rests on my conviction that Congress could not have intended the perverse result that the dissent’s rule would produce if its definition of 'proceeds' were applied to the operation of an unlicensed gambling business."