New Rule Proposed by the Government to Further Monitor Possible Money Laundering

On Behalf of | Feb 19, 2024 | Criminal Defense, Federal Crimes, Felonies |

Proposed Rule to Curb Money Laundering Through Real Estate

As we have previously discussed, the United States Treasury Department has recently implemented or proposed new rules to crack down on money laundering through corporate ownership interest and is now seeking to provide more information to law enforcement through the implementation of new rules related to real estate transactions. The proposed rule would require businesses engaged in real estate transactions and transfers to flag and report any entirely cash residential purchases made to an entity or trust. Experts point out that there is currently no rule that requires reporting to the government when individuals use illicitly gained funds to purchase property through legal entities or trusts, which Treasury Secretary Janet Yellen estimates lead to approximately $2.3 billion of real estate transactions between 2015 and 2020 being connected to money laundering in the United States. If the new rule were to go into effect, the United States government will have another tool at their disposal to investigate and prosecute those engaging in cash transactions, regardless of the actual source of said funds.

Hard Currency Still Preferred Method of Money Laundering in United States

As detailed in three separate reports from the United States Treasury Department, criminals and criminal organizations are far more likely to use cash to launder their money than use emerging technologies such as cryptocurrency. While cryptocurrency is used in cases, such as those involving ransomware, scams, drug trafficking, human trafficking, and other illicit activities as acknowledged in the reports, the government has certain safeguards and reporting obligations on cryptocurrency exchanges and service providers which can be used to track and fine nefarious groups using those investigative tools. The widespread acceptance of United States cash by businesses and people around the world, as opposed to other forms of currency, ensures that it will remain the preferred method of money laundering for those engaging in illicit activities, and thus the focus of law enforcement for the foreseeable future.


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