senate Bill S7529

Establishes certain offenses relating to structuring and money laundering

download pdf

Sponsor

Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
view actions

actions

  • 15 / May / 2014
    • REFERRED TO CODES

Summary

Establishes certain offenses relating to structuring and money laundering.

do you support this bill?

Bill Details

Versions:
S7529
Legislative Cycle:
2013-2014
Current Committee:
Senate Codes
Law Section:
Penal Law
Laws Affected:
Amd §§470.00, 470.03, 470.25 & 460.10, add §§470.30 - 470.33, Pen L

Sponsor Memo

BILL NUMBER:S7529

TITLE OF BILL: An act to amend the penal law, in relation to
establishing certain offenses relating to structuring and money
laundering

PURPOSE OR GENERAL IDEA OF BILL:

Establishes the crimes of structuring in the second and first degrees
and criminal monetary transaction in the second and first degrees.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1 amends section 470.00 of the penal law by adding three new
subdivisions 11, 12, and 13. Subdivision 11 defines the term
"structures" for the purposes of sections 470.30 and 470.31 of the
penal law. Subdivision 12 defines the term "monetary transaction".
Subdivision 13 defines the term "property derived from specified
criminal conduct".

Section 2 adds four new sections to the penal law: 470.30, 470.31,
470.32, and 470.33. Section 470.30 establishes the crime of
structuring in the second degree, and provides that it shall be
considered a class E felony. Section 470.31 establishes the crime of
structuring in the first degree, and provides that it shall be a class
D felony. Section 470.32 establishes the crime of criminal monetary
transaction in the second degree, and provides that it shall be a
class E felony. Section 470.33 establishes the crime of criminal
monetary transaction in the first degree, and provides that it shall
be a class D felony.

Section 3 amends subdivision 3 of section 470.03 of the penal law to
provide that monetary transactions may be considered together and the
value of the property derived from specified criminal conduct may be
aggregated, provided that the monetary transactions are all part of a
single "criminal transaction" as defined in subdivision two of section
40.10 of the criminal procedure law. It also provides that nothing in
section 470.32 or section 470.33 shall make it unlawful to return
funds held in escrow, under certain conditions.

Section 4 amends section 470.25 of the penal law to add criminal
monetary transactions to the section on money laundering and fines and
provides a fine structure for persons convicted of a criminal monetary
transaction.

Section 5 amends paragraph (a) of subdivision 1 of section 460.10 of
the penal law to add structuring and money laundering.

Section 6 provides that the act shall take effect on the first of
November next succeeding the date upon which this act shall have
become a law.

JUSTIFICATION:

This legislation is necessary to provide law enforcement with a tool
to prosecute those who attempt to evade federal reporting requirements
by making deposits in amounts just under the minimum threshold of


$10,000 required for banks to file a currency transaction report. This
is a strategy often employed by money launderers and tax evaders to
avoid scrutiny of their funds.

According to a report released by the New York State White Collar
Crime Task Force, "prosecutors would often be able to show the intent
to evade a filing requirement... but it is usually quite difficult
under current law to prove that a defendant who structures
transactions also intended to commit an existing penal offense, such
as tax fraud or money laundering, sufficient to charge them as an
accomplice or co-conspirator."

This legislation creates the crime of "structuring", which would allow
prosecutors to charge a person with structuring deposits to avoid
reporting requirements without the burden of proof that a defendant
had committed further crimes.

This legislation also creates the crime of "criminal monetary
transaction", which, according to the New York State White Collar
Crime Task Force report, would prohibit large-scale transactions
knowingly involving "criminally derived property". This would cover
the individuals who knowingly committed a crime and then spent money
gained through criminal activity in a transaction, and would also
cover "merchants and financial institutions that knowingly receive
tainted funds in the course of ordinary commercial activity", as long
as the transaction is in excess of $10,000.

PRIOR LEGISLATIVE HISTORY:

New Legislation.

FISCAL IMPLICATIONS:

None to the state.

EFFECTIVE DATE:

Section 6 provides that the act shall take effect on the first of
November next succeeding the date upon which this act shall have
become a law.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  7529

                            I N  S E N A T E

                              May 15, 2014
                               ___________

Introduced  by  Sen. HOYLMAN -- read twice and ordered printed, and when
  printed to be committed to the Committee on Codes

AN ACT to amend the penal  law,  in  relation  to  establishing  certain
  offenses relating to structuring and money laundering

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 470.00 of the penal law is amended by adding  three
new subdivisions 11, 12 and 13 to read as follows:
  11.  "STRUCTURES"  FOR  PURPOSES OF SECTIONS 470.30 AND 470.31 OF THIS
ARTICLE, A PERSON STRUCTURES A TRANSACTION  WHEN,  WITH  THE  INTENT  TO
EVADE  ANY REPORTING REQUIREMENT UNDER THE NEW YORK STATE BANKING LAW OR
31 U.S.C. SS 5311 THROUGH 5326, OR ANY REGULATION PRESCRIBED THEREUNDER,
HE OR SHE CONDUCTS OR ATTEMPTS TO CONDUCT ONE  OR  MORE  RELATED  TRANS-
ACTIONS  IN  CURRENCY,  IN ANY AMOUNT, WITH ONE OR MORE FINANCIAL INSTI-
TUTIONS, ON ONE OR MORE DAYS. STRUCTURING INCLUDES, BUT IS  NOT  LIMITED
TO, THE BREAKING DOWN OF A SINGLE SUM OF CURRENCY EXCEEDING TEN THOUSAND
DOLLARS  INTO  SMALLER  SUMS,  INCLUDING  SUMS  AT OR BELOW TEN THOUSAND
DOLLARS, OR THE CONDUCT OF A TRANSACTION, OR SERIES OF  CURRENCY  TRANS-
ACTIONS,  INCLUDING  TRANSACTIONS  AT OR BELOW TEN THOUSAND DOLLARS. THE
TRANSACTION OR TRANSACTIONS NEED NOT  EXCEED  THE  TEN  THOUSAND  DOLLAR
REPORTING THRESHOLD AT ANY SINGLE FINANCIAL INSTITUTION OR ON ANY SINGLE
DAY IN ORDER TO CONSTITUTE STRUCTURING.
  12.  "MONETARY  TRANSACTION"  MEANS  A  DEPOSIT,  WITHDRAWAL, TRANSFER
BETWEEN ACCOUNTS, EXCHANGE  OF  CURRENCY,  LOAN,  EXTENSION  OF  CREDIT,
PURCHASE  OR  SALE  OF ANY STOCK, BOND, CERTIFICATE OF DEPOSIT, OR OTHER
MONETARY INSTRUMENT, USE OF A SAFE DEPOSIT BOX, OR  ANY  OTHER  PAYMENT,
TRANSFER,  OR  DELIVERY  BY,  THROUGH, OR TO A FINANCIAL INSTITUTION, BY
WHATEVER MEANS EFFECTED, EXCEPT THAT "MONETARY  TRANSACTION"  SHALL  NOT
INCLUDE  ANY  TRANSACTION  INVOLVING BONA FIDE PAYMENTS TO ATTORNEYS FOR
LEGAL SERVICES.
  13. "PROPERTY DERIVED FROM SPECIFIED CRIMINAL CONDUCT" MEANS ANY PROP-
ERTY CONSTITUTING, OR  DERIVED  FROM,  PROCEEDS  OF  SPECIFIED  CRIMINAL
CONDUCT, AND NEED NOT EXCLUSIVELY CONSTITUTE OR BE DERIVED FROM PROCEEDS
OF SPECIFIED CRIMINAL CONDUCT.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD15163-01-4

S. 7529                             2

  S  2.  The  penal  law  is amended by adding four new sections 470.30,
470.31, 470.32 and 470.33 to read as follows:
S 470.30 STRUCTURING IN THE SECOND DEGREE.
  A  PERSON IS GUILTY OF STRUCTURING IN THE SECOND DEGREE WHEN, WITH THE
INTENT TO EVADE ANY REPORTING REQUIREMENT UNDER THE NEW YORK STATE BANK-
ING LAW OR 31 U.S.C. SS 5311 THROUGH 5326, OR ANY REGULATION  PRESCRIBED
THEREUNDER, HE OR SHE STRUCTURES ONE OR MORE TRANSACTIONS.
  STRUCTURING IN THE SECOND DEGREE IS A CLASS E FELONY.
S 470.31 STRUCTURING IN THE FIRST DEGREE.
  A  PERSON  IS GUILTY OF STRUCTURING IN THE FIRST DEGREE WHEN HE OR SHE
COMMITS THE CRIME OF STRUCTURING IN  THE  SECOND  DEGREE  AND:  (1)  THE
CONDUCT IS COMMITTED WITH AN INTENT TO COMMIT ANOTHER CRIME OR TO AID OR
CONCEAL  THE  COMMISSION OF ANOTHER CRIME; OR (2) THE AGGREGATE VALUE OF
THE CURRENCY REPORTED OR THE CURRENCY THAT  SHOULD  HAVE  BEEN  REPORTED
EXCEEDS ONE HUNDRED THOUSAND DOLLARS IN ANY TWELVE-MONTH PERIOD.
  STRUCTURING IN THE FIRST DEGREE IS A CLASS D FELONY.
S 470.32 CRIMINAL MONETARY TRANSACTION IN THE SECOND DEGREE.
  A  PERSON  IS GUILTY OF ENGAGING IN A CRIMINAL MONETARY TRANSACTION IN
THE SECOND DEGREE WHEN HE OR SHE KNOWINGLY ENGAGES OR ATTEMPTS TO ENGAGE
IN A MONETARY TRANSACTION IN PROPERTY DERIVED FROM CRIMINAL CONDUCT WITH
A VALUE GREATER THAN TWENTY THOUSAND DOLLARS AND THE PROPERTY IS DERIVED
FROM SPECIFIED CRIMINAL CONDUCT.
  CRIMINAL MONETARY TRANSACTION IN THE SECOND DEGREE IS A CLASS E  FELO-
NY.
S 470.33 CRIMINAL MONETARY TRANSACTION IN THE FIRST DEGREE.
  A  PERSON  IS GUILTY OF ENGAGING IN A CRIMINAL MONETARY TRANSACTION IN
THE FIRST DEGREE WHEN HE OR SHE KNOWINGLY ENGAGES OR ATTEMPTS TO  ENGAGE
IN A MONETARY TRANSACTION IN PROPERTY DERIVED FROM CRIMINAL CONDUCT WITH
A  VALUE GREATER THAN SIXTY THOUSAND DOLLARS AND THE PROPERTY IS DERIVED
FROM SPECIFIED CRIMINAL CONDUCT.
  CRIMINAL MONETARY TRANSACTION IN THE FIRST DEGREE IS A CLASS D FELONY.
  S 3. Subdivision 3 of section 470.03 of the penal law, as  amended  by
section  17  of  part  A of chapter 1 of the laws of 2004, is amended to
read as follows:
  3. FOR PURPOSES OF SECTIONS 470.32 AND 470.33 OF THIS  ARTICLE,  MONE-
TARY  TRANSACTIONS MAY BE CONSIDERED TOGETHER AND THE VALUE OF THE PROP-
ERTY DERIVED FROM SPECIFIED CRIMINAL CONDUCT MAY BE AGGREGATED, PROVIDED
THAT THE MONETARY TRANSACTIONS ARE ALL PART OF A SINGLE "CRIMINAL TRANS-
ACTION" AS DEFINED IN SUBDIVISION TWO OF SECTION 40.10 OF  THE  CRIMINAL
PROCEDURE LAW.
  4.  Nothing  in  sections  470.05,  470.21, 470.22, 470.23 and 470.24;
paragraph (b) of subdivision one, paragraph (b) of subdivision  two  and
paragraph  (b)  of subdivision three of section 470.10; paragraph (b) of
subdivision one, paragraph (b) of subdivision two and paragraph  (b)  of
subdivision  three  of section 470.15; [or] paragraph (b) of subdivision
one and paragraph (b) of subdivision two of section 470.20;  OR  SECTION
470.32  OR  SECTION  470.33  of  this  article shall make it unlawful to
return funds held in escrow:
  (a) as a portion of a purchase price for real property pursuant  to  a
contract of sale; or
  (b)  to  satisfy the tax or other lawful obligations arising out of an
administrative or judicial proceeding concerning the person who provided
the escrow funds.
  S 4. Section 470.25 of the penal law, as amended by chapter 489 of the
laws of 2000, is amended to read as follows:
S 470.25 Money laundering AND CRIMINAL MONETARY TRANSACTIONS; fines.

S. 7529                             3

  1. Any person convicted of a  violation  of  section  470.05,  470.10,
470.15,  or 470.20 of this article may be sentenced to pay a fine not in
excess of two times the value of the monetary instruments which are  the
proceeds of specified criminal activity. When a fine is imposed pursuant
to  this  subdivision, the court shall make a finding as to the value of
such monetary instrument or instruments. If the record does not  contain
sufficient  evidence  to  support such a finding the court may conduct a
hearing upon the issue. In imposing a fine, the court shall consider the
seriousness of the conduct, whether the amount of the fine is dispropor-
tionate to the conduct in which he engaged, its impact  on  victims,  as
well  as  the  economic circumstances of the convicted person, including
the effect of the imposition of such a fine upon his immediate family.
  2. ANY PERSON CONVICTED OF A VIOLATION OF SECTION 470.32 OR 470.33  OF
THIS  ARTICLE  MAY BE SENTENCED TO PAY A FINE NOT IN EXCESS OF TWO TIMES
THE VALUE OF THE MONETARY TRANSACTION WHICH IS THE PROCEEDS OF SPECIFIED
CRIMINAL CONDUCT. WHEN A FINE IS IMPOSED PURSUANT TO  THIS  SUBDIVISION,
THE  COURT  SHALL MAKE A FINDING AS TO THE VALUE OF SUCH MONETARY TRANS-
ACTION. IF THE RECORD DOES NOT CONTAIN SUFFICIENT  EVIDENCE  TO  SUPPORT
SUCH A FINDING THE COURT MAY CONDUCT A HEARING UPON THE ISSUE. IN IMPOS-
ING  A  FINE,  THE  COURT SHALL CONSIDER THE SERIOUSNESS OF THE CONDUCT,
WHETHER THE AMOUNT OF THE FINE IS DISPROPORTIONATE  TO  THE  CONDUCT  IN
WHICH HE ENGAGED, ITS IMPACT ON VICTIMS, AS WELL AS THE ECONOMIC CIRCUM-
STANCES  OF THE CONVICTED PERSON, INCLUDING THE EFFECT OF THE IMPOSITION
OF SUCH A FINE UPON HIS IMMEDIATE FAMILY.
  3. The imposition of a  fine  pursuant  to  subdivision  one  of  this
section or paragraph b of subdivision one of section 80.00 of this chap-
ter,  shall  preclude  the  imposition of any other order or judgment of
forfeiture or fine based upon the same criminal conduct.
  S 5. Paragraph (a) of subdivision 1 of section  460.10  of  the  penal
law,  as  amended  by section 16 of subpart A of part H of chapter 55 of
the laws of 2014, is amended to read as follows:
  (a) Any of the felonies set forth in this  chapter:  sections  120.05,
120.10 and 120.11 relating to assault; sections 121.12 and 121.13 relat-
ing  to  strangulation;  sections 125.10 to 125.27 relating to homicide;
sections 130.25, 130.30 and 130.35 relating to rape; sections 135.20 and
135.25 relating to kidnapping; section 135.35 relating  to  labor  traf-
ficking;  section  135.65  relating to coercion; sections 140.20, 140.25
and 140.30 relating to burglary;  sections  145.05,  145.10  and  145.12
relating  to  criminal  mischief;  article one hundred fifty relating to
arson; sections 155.30, 155.35, 155.40  and  155.42  relating  to  grand
larceny;  sections  177.10, 177.15, 177.20 and 177.25 relating to health
care fraud; article one hundred  sixty  relating  to  robbery;  sections
165.45,  165.50,  165.52  and  165.54 relating to criminal possession of
stolen property; sections 165.72 and 165.73 relating to trademark  coun-
terfeiting;  sections 170.10, 170.15, 170.25, 170.30, 170.40, 170.65 and
170.70 relating to forgery; sections 175.10, 175.25, 175.35, 175.40  and
210.40 relating to false statements; sections 176.15, 176.20, 176.25 and
176.30  relating to insurance fraud; sections 178.20 and 178.25 relating
to criminal diversion of  prescription  medications  and  prescriptions;
sections 180.03, 180.08, 180.15, 180.25, 180.40, 180.45, 200.00, 200.03,
200.04,  200.10, 200.11, 200.12, 200.20, 200.22, 200.25, 200.27, 200.56,
215.00, 215.05 and 215.19 RELATING TO BRIBERY; sections 187.10,  187.15,
187.20  and  187.25  relating  to  residential  mortgage fraud, sections
190.40 and 190.42 relating to criminal usury; section 190.65 relating to
schemes to defraud; any felony defined in article four  hundred  ninety-
six;  sections  205.60  and  205.65  relating  to hindering prosecution;

S. 7529                             4

sections 210.10, 210.15, and 215.51 relating to  perjury  and  contempt;
section  215.40  relating  to tampering with physical evidence; sections
220.06, 220.09, 220.16, 220.18, 220.21, 220.31, 220.34, 220.39,  220.41,
220.43,  220.46,  220.55,  220.60  and  220.77  relating  to  controlled
substances; sections 225.10 and 225.20 relating  to  gambling;  sections
230.25,  230.30,  and 230.32 relating to promoting prostitution; section
230.34 relating to sex trafficking; sections 235.06, 235.07, 235.21  and
235.22  relating  to  obscenity;  sections 263.10 and 263.15 relating to
promoting a sexual performance by  a  child;  sections  265.02,  265.03,
265.04,  265.11,  265.12,  265.13  and  the provisions of section 265.10
which constitute a felony relating to firearms and other dangerous weap-
ons; sections 265.14 and 265.16 relating to criminal sale of a  firearm;
section  275.10,  275.20,  275.30,  or  275.40  relating to unauthorized
recordings; and sections 470.05, 470.10, 470.15 and 470.20  relating  to
money  laundering;  SECTIONS  470.30 AND 470.31 RELATING TO STRUCTURING;
AND SECTIONS 470.32 AND 470.33  RELATING  TO  CRIMINAL  MONETARY  TRANS-
ACTIONS; or
  S 6. This act shall take effect on the first of November next succeed-
ing the date upon which this act shall have become a law.

Comments

Open Legislation comments facilitate discussion of New York State legislation. All comments are subject to moderation. Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity or hate speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Comment moderation is generally performed Monday through Friday.

By contributing or voting you agree to the Terms of Participation and verify you are over 13.