United States v. Santos, 553 U.S. 507 (2008)
Primary Holding
The term "proceeds" in the federal money-laundering statute, 18 U.S.C. § 1956(a)(1), refers specifically to "profits" from illegal activities rather than merely "receipts.
In the case of United States v. Santos, the Supreme Court decided that the term "proceeds" in a law about money laundering specifically means "profits" from illegal activities, not just any money received. This is important because it protects individuals from being unfairly charged with money laundering if the money involved was just part of the business operation and not actual profit. This ruling is relevant if someone is facing legal issues related to money laundering, as it clarifies what counts as illegal profits in such cases.
AI-generated plain-language summary to help you understand this case
In the case of United States v. Santos, Efrain Santos operated an illegal lottery in Indiana from the 1970s until 1994. He employed runners who collected bets from gamblers at various locations, retaining a commission of 15% to 25% before passing the remaining bets to collectors, including co-defendant Benedicto Diaz. Santos received the total amounts collected and used them to pay salaries to his collectors and to distribute winnings. The operation led to a 10-count indictment against Santos, Diaz, and several others, resulting in convictions for conspiracy to run an illegal gambling business, running an illegal gambling business, conspiracy to launder money, and money laundering. Santos was sentenced to a total of 270 months in prison, while Diaz received a sentence of 108 months. The procedural history began with the initial convictions being affirmed by the Court of Appeals. Following this, Santos and Diaz filed motions under 28 U.S.C. § 2255 to challenge their convictions and sentences. The District Court rejected most of their claims but accepted one related to their money-laundering convictions, referencing a subsequent Seventh Circuit decision in United States v. Scialabba, which interpreted the term "proceeds" in the federal money-laundering statute to mean criminal profits rather than criminal receipts. The District Court vacated the money-laundering convictions based on this interpretation, and the Court of Appeals upheld this decision, leading the government to seek certiorari from the Supreme Court. The relevant background context of this case centers on the interpretation of the term "proceeds" in the federal money-laundering statute, 18 U.S.C. § 1956(a)(1). The distinction between "receipts" and "profits" was pivotal in determining the legality of the transactions involved in Santos's lottery operation. The Supreme Court's review aimed to clarify this interpretation, which had significant implications for the defendants' convictions and the enforcement of money-laundering laws.
Whether the term “proceeds” in the federal money-laundering statute, 18 U.S.C. §1956(a)(1), means “receipts” or “profits.”
The judgment is reversed.
- Court
- Supreme Court
- Decision Date
- October 3, 2007
- Jurisdiction
- federal
- Case Type
- landmark
- Damages Awarded
- N/A
- Data Quality
- high
Regalado Cuellar v. United States, 553 U.S. 550 (2008)
Consumer WonThe federal money laundering statute requires the government to demonstrate that a defendant engaged in conduct beyond merely hiding illicit funds during transport; it must show that the defendant took steps to conceal the illegal nature of the funds in a manner that indicates an intent to promote or conceal unlawful activity.
Pasquantino v. United States, 544 U.S. 349 (2005)
Consumer LostA scheme to defraud a foreign government of tax revenue constitutes a violation of the federal wire fraud statute, 18 U.S.C. § 1343, as the statute's plain terms criminalize such conduct without infringing upon the common-law revenue rule.
Whitfield v. United States, 543 U.S. 209 (2005)
Consumer LostConviction for conspiracy to commit money laundering under 18 U.S.C. §1956(h) does not require proof of an overt act in furtherance of the conspiracy.
Scheidler v. National Organization for Women, Inc., 547 U.S. 9 (2006)
Consumer LostThe Supreme Court held that the Hobbs Act's prohibition on "obstructing, delaying, or affecting commerce" through violence applies only to violent acts committed in furtherance of plans or purposes involving robbery or extortion, rather than to all violent actions that affect interstate commerce.