Bipartisan Senate bill targets money laundering linked to drug trafficking, terrorism

Senate Judiciary Committee Chairman Chuck Grassley and Sen. Amy Klobuchar introduced a bipartisan measure to crack down on money laundering by increasing penalties and ensuring laws apply to systems used by drug traffickers and terrorists.

Grassley, R-Iowa, and Klobuchar, D-Minn., introduced the ‘Combating Money Laundering, Terrorist Finance and Counterfeiting Act’ Friday to enhance criminal money laundering statutes.

The bill would update counterfeiting laws to prohibit state-of-the-art counterfeiting methods and increase penalties for bulk cash smuggling.

The bill would also ensure money laundering laws apply to informal value transfer systems that are often used by drug traffickers and terrorists.

The introduction of the bill comes as Trump administration officials warn that hostile actors, like cartels and terrorists, are funding operations through complex financial channels across the U.S. border. 

Grassley and Klobuchar also said the bill would prohibit the cross-border shipment of blank checks for the purpose of evading reporting requirements.

‘Criminal enterprises and terrorist organizations depend on ill-begotten cash to carry out their dark deeds. As money laundering methods have evolved over time, so must the government’s efforts to exact justice,’ Grassley said, adding that their bill would ensure law enforcement ‘has the tools they need to track down dirty money, hold criminals accountable and prevent further crimes.’

Klobuchar added that as criminals and terrorist organizations ‘develop new methods to launder money, we must provide our law enforcement with the tools they need to keep American communities safe.’

‘This bipartisan legislation makes necessary updates to anti-money laundering statutes and counterfeiting laws, ensuring the law enforcement community can stay one step ahead of those working to undermine our nation’s safety and security,’ she said.

The bill also would establish a new money laundering violation that would prohibit the transfer of funds into or out of the United States — funds specifically being transferred with the intent to violate U.S. income tax laws.

The bill would also prohibit conspiracies to create illegal money services businesses; grant wiretapping authority to investigate currency reporting, bulk cash smuggling, illegal money services businesses and counterfeiting offenses; and grant the U.S. Secret Service the explicit authority to investigate ransomware crimes and other uses of unlicensed money transmitting; and would ensure compliance with financial institutions. 

The measure has wide support in the law enforcement community and has been endorsed by the Fraternal Order of Police, the National Association of Assistant U.S. Attorneys, the National Association of Police Organizations and the National District Attorneys Association.

‘By clarifying the law in response to recent court decisions, strengthening penalties and expanding investigative authorities, this legislation will restore critical law enforcement tools and help disrupt transnational criminal organizations,’ Patrick Yoes, president of the Fraternal Order of Police said, adding that the organization ‘strongly supports this bill, which would prevent criminals and terrorists from profiting from their crimes and protect public safety and national security.’

The National Association of Assistant U.S. Attorneys also endorsed the bill saying the ‘targeted reforms will strengthen investigations, improve prosecutorial clarity and better reflect how modern money-laundering schemes actually operate.’