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Money laundering, seizure, and forfeiture of property
What is the offense of money laundering?
Money laundering is the performance of an act with money or property originating from an offense, with the aim of concealing its source, the identity of those entitled to it, its location or its movements, and integrating it into lawful and legitimate property.
The Prohibition on Money Laundering Law was enacted in 2000 with the aim of combating organized crime and the financing of terrorism. But it quickly became a routine enforcement tool; today it is added almost automatically to many economic offense cases: fraud, deception, tax offenses, bribery and more. The suspects do not have a defined profile; enforcement applies equally to private individuals, business owners, members of the liberal professions and public employees.
Punishment
Up to 10 years' imprisonment, in addition to the penalty for the predicate offense from which the prohibited property was derived. In addition: forfeiture of property equal in value to the property with which the offense was committed.
The draconian tool: seizure and forfeiture of property
This is one of the most severe aspects of the law. When there is suspicion of the commission of a money laundering offense, the enforcement authorities may temporarily seize the suspect's property, even before conviction, and while the presumption of innocence still stands.
What can be seized: bank accounts; real estate assets; vehicles; jewelry and works of art; shares and rights, on the personal and corporate level. Sometimes this goes so far as a complete cessation of economic activity.
Critical point: it is not necessary to prove that the seized property is directly connected to the commission of the offense. Completely legitimate property may be seized, even that of third parties whose purchase was financed by the suspect or to whom the suspect transferred money without consideration.
How long does the seizure last?
Large-scale money laundering investigations sometimes continue for years. The temporary seizure accompanies that entire period. The longer the investigation continues, the more the harm to the suspect and his family worsens. Even the ability to hire proper legal representation may be impaired when accounts are frozen.
The state is required to present an evidentiary foundation justifying the continuation of the seizure, and the court examines whether there is forfeiture potential and whether the seizure measures are proportionate. There is no obligation to accept the seizure.
Forfeiture after conviction
Section 21 of the law provides: if a person is convicted, the court shall order, in addition to any punishment, the forfeiture of property from his assets equal in value to the property with which the offense was committed. The forfeiture shall apply to any property in the possession, control, or account of the convicted person, even if it was transferred to a third party after the commission of the offense. The result: deprivation of the rights in the property and their transfer to the State.
Before issuing a forfeiture order, the court must allow the convicted person, the owner of the property, and anyone claiming a right in it, to present their arguments.
Why is early representation critical?
In money laundering cases, every day that passes without representation is a day in which the seizure becomes more entrenched, the damage accumulates, and the room for action narrows. A lawyer who becomes involved early can apply to the court, challenge the legality of the seizure and its scope, and request an alternative to seizure that causes less harm to the suspect’s property rights while preserving the objectives of future forfeiture.
Legal representation in money laundering cases
Israel Arama, formerly of the Tel Aviv District Attorney’s Office, represents suspects and defendants in money laundering offenses, including seizure and forfeiture proceedings. Familiarity with the way the economic investigation units operate and with the prosecution’s considerations in these cases allows for effective action from the very first moment. Contact us for an initial consultation with no obligation, before providing a statement and before the property is seized.
What is the offense of money laundering?
Money laundering is the performance of an act with money or property originating from an offense, with the aim of concealing its source, the identity of those entitled to it, its location, or its movements, and integrating it into lawful and legitimate property. The Prohibition on Money Laundering Law was enacted in 2000 with the aim of combating organized crime and the financing of terrorism. However, it quickly became a routine enforcement tool, and today it is added almost automatically to many economic offense cases: fraud, deception, tax offenses, bribery, and more. The suspects do not fit a defined profile; enforcement applies equally to private individuals, business owners, members of the professions, and public employees.
The draconian tool: seizure and forfeiture of property — what is important to know?
This is one of the most severe aspects of the law. When there is suspicion of a money laundering offense, the enforcement authorities may temporarily seize a suspect’s property even before conviction, and while the presumption of innocence still stands. What may be seized: bank accounts; real estate assets; vehicles; jewelry and works of art; shares and rights, at both the individual and corporate level. At times, this goes so far as to bring economic activity to a complete halt. A critical point: it is not necessary to prove that the seized property is directly connected to the commission of the offense. Entirely legitimate property may be seized, even that of third parties whose purchase was financed by the suspect or to whom the suspect transferred money without consideration.
How long does the seizure last?
Large-scale money laundering investigations sometimes continue for years. The temporary seizure accompanies the entire period. The longer the investigation lasts, the more severe the harm to the suspect and the suspect’s family becomes. Even the ability to retain proper legal representation may be impaired when accounts are frozen. The State is required to present an evidentiary basis justifying the continuation of the seizure, and the court examines whether there is forfeiture potential and whether the seizure measure is proportionate. There is no obligation to accept the seizure.
Why is early representation critical?
In money laundering cases, every day that passes without representation is a day in which the seizure becomes more entrenched, the damage accumulates, and the room for action narrows. A lawyer who becomes involved early can apply to the court, challenge the legality of the seizure and its scope, and request an alternative to seizure that causes less harm to the suspect’s property rights while preserving the objectives of future forfeiture.
This information is for initial orientation about the service and contact process. It is not individual legal advice.
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