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Tuesday, June 03, 2008

Ind. Decisions - More on: U.S. Supreme Court rules on Lake County definition of "money laundering" case

Updating this ILB entry from yesterday, Warren Richey of The Christian Science Monitor has a long article today headed "Harder task to nail money launderers: Two high court rulings on Monday will complicate US efforts to prove certain crimes." It begins:

Washington - The Supreme Court has made it more difficult for the government to prove certain money-laundering crimes.

Ruling against federal prosecutors in two cases on Monday, the high court reversed the conviction of a man caught with cash hidden in his car in Texas near the Mexican border, and the court refused to reinstate a money-laundering conviction in a case involving an illegal gambling operation in Indiana.

Both decisions hold potentially important implications for crime fighting. In both cases the justices rejected the Justice Department's expansive reading of the federal money-laundering statutes.

Howard Bashman of How Appealing has collected together this morning the links to reports on the decision in the major papers.

Here in Indiana Andy Grimm of the Gary Post-Tribune has a story headed "High court back East Chicago numbers king." The interesting report begins:

East Chicago numbers king Efrain "Puerto Rican Frankie" Santos walked out of federal prison three years ago. Monday, he walked into law books.

In a ruling that will keep Santos from having to return to prison to finish a 15-year sentence, and one law enforcement officials say will make it harder to prosecute organized crime figures, in U.S. v. Santos, the Supreme Court on Monday issued a 5-4 decision to overturn Santos' 1998 conviction for money laundering.

"I was pretty sure about it all along," said Santos, who was released from federal prison in 2004 while his appeal was pending before the court.

Santos served nearly two years of the money laundering sentence, on top of a 4-year term on a separate charge of gambling for running the city's illegal lottery, or "bolita."

Though he faithfully recorded the profits he earned from bolita on his tax forms each year-- in the space for "miscellaneous" revenue-- federal prosecutors had charged Santos concealed some of the ill-gotten gains from his lottery by deducting wages and payouts to winners from the total. The additional charges carried an extra 10 years in prison.

The money laundering statute states that a crime is committed if the "proceeds" of criminal activity are hidden, but Justice Antonin Scalia, writing for the majority, stated the language should be interpreted to mean profits, not gross receipts.

"What I like is that Judge Scalia made the decision, and Judge Scalia is a conservative Justice. He said during the hearing what I said all along: 'If I play a number and I win, I want to get paid.'

"Paying winners, paying your runners, that's just what you've got to do."

See also Bill Dolan's story in the NWI Times that begins: "A local gambling legend beat the odds Monday and won a victory over federal prosecutors in a ruling that is sure to shape the definition of the crime of money laundering."

Posted by Marcia Oddi on June 3, 2008 09:00 AM
Posted to Ind. (7th Cir.) Decisions