The following examples of money laundering investigations that led to convictions were derived from Internal Revenue Service (IRS) reports. They are provided here to serve as examples of the type of investigation in which suspicious activity reporting by banks under the Bank Secrecy Act may prove useful.

• Former Public Official Sentenced to Prison for Tax Evasion. In Boston, a woman was sentenced to a year and a day in federal prison for tax evasion. In addition, the defendant was ordered to pay a fine of $10,000 and serve a term of three years supervised release. As a government employee, she had overseen the operations of the central cash repository for the Metropolitan Boston Transit Authority. The facility she managed regularly contained hundreds of thousands of dollars in cash. From 2000 through 2003, the defendant spent at least $314,000 in cash on designer jewelry, clothing, shoes and cosmetics. The money could not be traced to any legitimate source and the court accepted the government’s allegation that the cash must have come from misconduct.
• California Woman Embezzles $11 Million. The defendant was sentenced to 78 months in prison and ordered to pay restitution for mail fraud and money laundering in connection with her embezzlement of over $11 million from her employer. The woman admitted to providing false payroll data to an employee at a payroll processing company that handled the payroll administration for two of her employer’s companies. As a result, she received grossly inflated fictitious pay checks on a biweekly basis for at least six years. The woman also had the employee at the payroll processing company alter the tax and payroll data that showed that she had received the fraudulently issued pay checks. In support of this "adjustment,” the woman provided the payroll company with bank records purportedly showing that the amount of money that she had fraudulently obtained had been reimbursed to the accounts. However, the funds for these monthly "reimbursements” had been fraudulently obtained by making unauthorized withdrawals on personal lines of credit that she had taken out in her employer’s name, without his knowledge, at three banks.
• Ukrainian Software Pirate Sentenced to 35 Months in Prison. A Ukrainian man received a 35 month prison term for selling pirated software. According to the plea agreement and other court records, the individual sold pirated software programs, such as Adobe, Autodesk, Borland and Microsoft software on eBay and on Web sites he operated. The accused individual pleaded guilty to criminal copyright infringement, trafficking in counterfeit goods, and money laundering. The sentencing followed the defendant’s extradition from Thailand, where he was arrested in May 2003. According to the U.S. Attorney, this case was one of the first involving an extradition for intellectual property crimes.
• Contractor and Governor’s Ex-Aide Sentenced. In Connecticut, two men were each sentenced to 30 months in prison followed by three years of supervised release following guilty pleas for federal bribery and defrauding the IRS. The two were charged in connection with a scheme whereby one man, then serving as the governor’s chief of staff, received bribes to direct state business to consulting firms owned by the second individual. The governor’s aide was given a credit card issued to the consulting company and used it to pay for thousands of dollars of personal expenses, such as airline tickets and expensive meals.
• Ten Year Sentence for Medicare Fraud. A Texas doctor was sentenced to 10 years in prison and ordered to pay $12 million dollars in restitution for conspiracy to illegally distribute certain prescription painkillers.
• Pharmacists Sentenced for Illegal Drug Sales, Money Laundering. Two Houston pharmacists were sentenced 120 months and 150 months in prison, respectively, for their involvement in a conspiracy to illegally distribute prescription drugs and to launder the proceeds of their illegal drug business. The pair, along with others who had been sentenced earlier, illegally distributed 1.7 million tablets of hydrocodone and 2,500 gallons of promethazine with codeine, a highly addictive narcotic cough suppressant.
• Former Customs Agent Sentenced for Bribes, Money Laundering. In Florida, a former agent for the Immigration and Customs Enforcement Agency was sentenced after pleading guilty to charges of bribery, conspiracy, obstruction, money laundering and making false statements to federal agents. The former agent received almost $18,000 in bribes from a foreign individual whom the agent knew was a suspected narcotics trafficker and money launderer.