Money laundering under C.R.S. § 18-5-309 is one of the few fraud-adjacent crimes in Colorado that carries a flat, serious felony classification regardless of the dollar amount involved. The statute targets financial transactions designed to conceal the source of criminal proceeds, promote further crime, or dodge federal reporting requirements.
What the Prosecution Must Prove
A person commits money laundering by conducting, attempting to conduct, transporting, transmitting, or transferring money or a monetary instrument that they know or believe represents the proceeds of a criminal offense, where the transaction is intended to:
- Promote the commission of a criminal offense, or
- Conceal or disguise the nature, location, source, ownership, or control of criminal proceeds, or
- Avoid a federal transaction-reporting requirement
The statute also reaches intentionally conducting a financial transaction involving property represented to be criminal proceeds (including in a sting operation run by law enforcement).
Classification
Money laundering is a class 3 felony — one of the most serious classifications in the Colorado criminal code, on par with aggravated robbery and second degree arson of an occupied structure.
Case Law That Shapes Money Laundering Defense
People v. Woodyard, 2023 COA 78: To convict under the “transports, transmits, or transfers” prong, the defendant must have personally done the transferring of an actual monetary instrument or money — not something else exchanged for money. The court found the evidence insufficient where the defendant received money and discussed a transfer but never personally transferred funds. The court also held this prong doesn’t require the funds to come from an offense separate from the transaction itself — it’s enough that the transaction promoted the commission of a criminal offense.
Butler v. People, 2019 CO 87: A complicitor (someone who aids or encourages another’s money laundering without personally conducting the transaction) can only be held liable if the prosecution proves five separate elements, including that the complicitor was aware of what the principal knew or believed about the proceeds and the purpose of the transaction. The prosecution only has to prove complicity for the specific acts charged, not an entire overarching scheme.
People v. Nevelik, 2021 COA 30: Colorado courts lack subject matter jurisdiction over a money laundering charge when the underlying banking activity happened entirely out of state — there, a defendant who opened a bank account in Texas, received and disbursed funds there, and never solicited Colorado victims to wire money to Texas. Jurisdiction and venue are real issues in any multi-state scheme.
Possible Defenses
Lack of knowledge or belief that the funds were criminal proceeds — this is a specific knowledge requirement, not something that can be inferred from mere association.
No personal transfer occurred — under Woodyard, discussing or facilitating a transfer isn’t the same as personally transporting, transmitting, or transferring the money.
Jurisdictional defects — where the financial activity occurred wholly outside Colorado, as in Nevelik.
Insufficient proof of the specific predicate offense the funds allegedly came from.
Charged With Money Laundering?
A class 3 felony money laundering charge carries some of the most serious penalties in the Colorado criminal code. Mile High Legal defends white-collar and financial crime charges across Colorado. Call now for a free, confidential case review.
