ILNews

SCOTUS quiet on money-laundering case

Michael W. Hoskins
January 1, 2008
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The nation's highest court hasn't yet ruled on an East Chicago case involving money laundering, but that could be because justices are waiting to hear a similar case before making a decision.

Indianapolis attorney Todd Vare with Barnes & Thornburg argued before the Supreme Court of the United States Oct. 3, but so far the court hasn't issued a decision on U.S. v. Efrain Santos, No. 06-1005.

Ten of the 14 cases argued that month have been ruled on, as well as other cases argued before the justices since October.

One possible reason the court hasn't ruled yet is that it's going to consider another similar case at the same time, said Vare, who represents Santos. Less than two weeks after his arguments last fall, justices accepted Cuellar v. U.S., No. 06-1456, that deals with the question of whether merely hiding funds without trying to make that money appear "clean" or "laundered" is sufficient to support a money-laundering conviction.

Arguments are set for Monday morning, and Vare anticipates the court will decide both simultaneously.

"It's possible - now quite probable - that the court will issue opinions in both cases on the same day," Vare said, adding that he hopes the delay will bode well for his client.

In Santos, the court is considering the definition of money laundering and the word "proceeds" as it's used in the federal statute. Federal Circuit Courts, including the 7th Circuit in Chicago, do not agree on an exact definition and have disagreed about whether it's considered money laundering to pay for the operation of a criminal enterprise with the profits of that illegal business. The nation's high court will determine whether the ban on the use of "proceeds" of a crime to promote or conceal it - "laundering" the proceeds - applies to the total amount of money or only the profits after expenses.

Specifically, this case involves the federal prosecution of an old tavern lottery raid where Santos - known as "Puerto Rican Frankie" - was arrested for running the illegal operation throughout northwest Indiana from the 1970s to 1994. He was sentenced to 17 years in prison in 1998, but he was later released after the 7th Circuit heard two other cases in 2000 and 2002 and issued rulings that changed the interpretation of money laundering.

Following those decisions, U.S. District Judge James Moody in Hammond ruled that Santos' actions were no longer considered money laundering because of an interpretation of "net proceeds" and "gross proceeds" in federal laws.

Vare took Santos' case as part of the 7th Circuit's pro bono appointment program.

The Cuellar case deals with the concealment prong of the statute, while Santos involves the "promotion" prong of the statute, Vare said. He recalled how several justices focused on how a ruling in Santos could affect cases arising under that concealment issue raised in Cuellar.
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  1. The practitioners and judges who hail E-filing as the Saviour of the West need to contain their respective excitements. E-filing is federal court requires the practitioner to cram his motion practice into pigeonholes created by IT people. Compound motions or those seeking alternative relief are effectively barred, unless the practitioner wants to receive a tart note from some functionary admonishing about the "problem". E-filing is just another method by which courts and judges transfer their burden to practitioners, who are the really the only powerless components of the system. Of COURSE it is easier for the court to require all of its imput to conform to certain formats, but this imposition does NOT improve the quality of the practice of law and does NOT improve the ability of the practitioner to advocate for his client or to fashion pleadings that exactly conform to his client's best interests. And we should be very wary of the disingenuous pablum about the costs. The courts will find a way to stick it to the practitioner. Lake County is a VERY good example of this rapaciousness. Any one who does not believe this is invited to review the various special fees that system imposes upon practitioners- as practitioners- and upon each case ON TOP of the court costs normal in every case manually filed. Jurisprudence according to Aldous Huxley.

  2. Any attorneys who practice in federal court should be able to say the same as I can ... efiling is great. I have been doing it in fed court since it started way back. Pacer has its drawbacks, but the ability to hit an e-docket and pull up anything and everything onscreen is a huge plus for a litigator, eps the sole practitioner, who lacks a filing clerk and the paralegal support of large firms. Were I an Indiana attorney I would welcome this great step forward.

  3. Can we get full disclosure on lobbyist's payments to legislatures such as Mr Buck? AS long as there are idiots that are disrespectful of neighbors and intent on shooting fireworks every night, some kind of regulations are needed.

  4. I am the mother of the child in this case. My silence on the matter was due to the fact that I filed, both in Illinois and Indiana, child support cases. I even filed supporting documentation with the Indiana family law court. Not sure whether this information was provided to the court of appeals or not. Wish the case was done before moving to Indiana, because no matter what, there is NO WAY the state of Illinois would have allowed an appeal on a child support case!

  5. "No one is safe when the Legislature is in session."

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