-23 Although there are additional provisions concerning the Right to Financial Privacy Act that I can discuss, I think that it might be appropriate to conclude my remarks at this point. I will be happy to answer any questions that the Subcommittee members may have. APPENDIX A ARIZONA MONEY LAUNDERING STATUTE 13-2317. Money laundering; classifications; definitions A. A person who acquires or maintains an interest in, transfers, transports, receives or conceals the existence or nature of racketeering proceeds knowing or having reason to know that they are the proceeds of an offense is guilty of money laundering in the second degree. B. A person who knowingly initiates, organizes, plans, finances, directs, manages, supervises or is in the business of money laundering is guilty of money laundering in the first degree. C. Money laundering in the second degree is a Class 3 felony. dering in the first degree is a Class 2 felony. Money laun D. In this section, "acquire" and "proceeds" have the same meaning as prescribed in section 13-2314. COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS UNITED STATES HOUSE OF REPRESENTATIVES CONCERNING MONEY LAUNDERING LEGISLATION MAY 14, 1986 My name is Samuel J. Buffone. I am a practicing criminal defense attorney and offer this testimony on behalf of the American Bar Association. In December of 1984 the White Collar Crime Committee of the ABA set up a subcommittee to study the problem of money laundering and proposed legislation designed to combat it. The Committee consists of 58 members of the ABA's Section of Criminal Justice, including defense lawyers, prosecutors, law professors and judges, at both state and federal levels. The Subcommittee was chaired by Bernard Bailor, a partner in the Washington, D.C. firm of Caplin & Drysdale. Following an extensive study a report was prepared and adopted by the Council of the Criminal Justice Section on December 7, 1985. The report and recommendations included with my testimony were presented to the ABA's House of Delegates in February 1986. The House of Delegates adopted the recommendations. The report of the Criminal Justice Section was not adopted by the House of Delegates but is provided to the Committee as background. I have also included with my testimony comments of the ABA section on Corporation Banking and Business Law on portions of the recommendations and report. The American Bar Association recognizes the pervasive nature of money laundering activities and the importance of combatting them. Our recommendations support the enactment of federal legislation which will assist federal law enforcement agencies in combatting money laundering. While we believe that it is important to provide effective tools to combat money laundering, our review of proposed legislation has led us to the conclusion that the proposals go much farther than is necessary to provide an effective means to combat this problem. The breadth of many provisions of the proposed legislation create significant problems and do not in our view provide the most effective means for combatting money laundering activities. The ABA believes that the most effective way to combat money laundering is to enact legislation that facilitates its detection. The available studies including the interim report of the President's Commission on Organized Crime, entitled The Cash Connection: Organized Crime Financial Institutions and Money Laundering, reveals that detection of money laundering is a far more significant problem than prosecuting the responsible parties after it is discovered. This follows from the inherently clandestine nature of money laundering. We recommend that legislation be geared to facilitating detection of such transactions and be specifically aimed at the following steps which appear in virtually every major money laundering case: 1. 2. 3. 4. The use of foreign transactions Failure to comply with the Bank Secrecy Act Reporting Use of multiple transactions to avoid reporting Conducting transactions with individuals in We recommend the following specific steps be taken: First, the Bank Secrecy Act should be amended to provide for faster notification to law enforcement agencies of possible 2 |