Most money laundering cases don’t start with the money. They start with another case — a drug investigation, a fraud scheme, a health-care billing review — and the government follows the cash.

That’s what makes these charges so dangerous. By the time you learn the government is tracing your accounts, it has usually spent months reading your bank records first — so you end up defending not just what you did with money, but where the government says it came from.

Keith & Lorfing defends people and businesses accused of money laundering and structuring in Houston and throughout the Southern District of Texas. Our team is led by a former Assistant U.S. Attorney and includes a retired federal judge of counsel, so we know how these cases are built before an indictment ever lands.

If your accounts are frozen, your bank has asked questions, or agents have made contact, speak with our federal money laundering defense team before saying anything to investigators.

What the government has to prove in a money laundering case

Money laundering sounds like one crime. In federal court it’s a family of related offenses, each with its own elements the government must prove beyond a reasonable doubt.

The two workhorse statutes are 18 U.S.C. § 1956 and 18 U.S.C. § 1957. Structuring under 31 U.S.C. § 5324 is a separate offense that often rides alongside them.

18 U.S.C. § 1956 — concealment, promotion, and international laundering

Section 1956 is the broad statute. Its theories share a demanding requirement: the government must prove you knew the money came from illegal activity and acted with a specific unlawful purpose.

• Concealment laundering: A transaction designed to hide the source, ownership, or control of criminal proceeds — the government must show you meant to disguise the money, not just move it.
• Promotion laundering: Using proceeds to further the underlying crime, such as reinvesting drug money back into the operation.
• International laundering: Moving funds into or out of the United States to promote a crime or conceal proceeds.

Moving money is not a crime; moving money to conceal or promote a crime is. That distinction is where many § 1956 cases are won or lost.

18 U.S.C. § 1957 — spending more than $10,000 of criminal proceeds

Section 1957 is narrower but easier to charge. It applies when someone knowingly engages in a monetary transaction of more than $10,000 in criminally derived property.

There is no requirement to prove intent to conceal or promote. Simply spending or depositing tainted money above that threshold — buying a car, closing on a house, wiring a large sum — can be enough. That lower bar is why § 1957 is often stacked onto a fraud or drug case: it turns ordinary spending into a separate felony, raising the stakes at sentencing.

“Specified unlawful activity” — the crime behind the money

Both statutes rest on a concept called specified unlawful activity, or SUA — the predicate crime the money is supposed to have come from, such as drug trafficking, wire fraud, health-care fraud, or bribery.

Money laundering is a derivative charge. If the government can’t prove the proceeds came from a qualifying predicate offense, the laundering count has nothing to stand on.

Structuring under 31 U.S.C. § 5324

Structuring surprises people. Banks must file a Currency Transaction Report for cash transactions over $10,000. Deliberately breaking up deposits or withdrawals to keep each one under that threshold is a federal crime under 31 U.S.C. § 5324 — even if the money is completely legitimate.

You don’t have to be laundering dirty money to be charged with structuring — you only have to be splitting transactions to avoid the reporting requirement. That’s a trap for small-business owners and cash-heavy operators who assumed keeping deposits “under ten grand” simply avoids paperwork. Intent is the whole question, and it is contestable.

If any of this describes your situation, ask us to review the government’s theory before you assume the worst.

Why money laundering charges are common in Houston

Houston is one of the busiest financial and trade hubs in the country — energy money, a major port, cross-border commerce, and a large banking sector. Those are the exact conditions federal investigators watch, and laundering charges here rarely travel alone. They are usually paired with a drug case, a fraud case, or a health-care case, because that’s where the underlying proceeds are alleged to originate — and prosecutors often stack a federal conspiracy charge on top.

Federal charges here are prosecuted by the U.S. Attorney’s Office for the Southern District of Texas and heard at the Bob Casey U.S. Courthouse, 515 Rusk St, in the Houston Division. These cases are part of our broader Houston federal criminal defense practice; for a nationwide overview of the charges and defenses, see our federal money laundering defense.

How money laundering cases are investigated

Money laundering is a paper crime, and the trail is built quietly — most defendants have no idea an investigation exists until it’s well advanced.

When our managing partner served as a federal prosecutor, many financial cases began with a whistleblower and a spreadsheet. Today the government leads with data — analytics that scan transaction patterns across whole industries and flag accounts that move differently from their peers. You no longer need an angry employee to draw scrutiny; transacting differently from your field can be enough to put you under review.

Several agencies drive these cases, often together:

• IRS Criminal Investigation (IRS-CI): The lead agency for following money — forensic accountants with badges who reconstruct where funds came from and went.
• FBI: Works fraud-driven and public-corruption laundering, often through joint task forces.
• DEA: Handles laundering tied to drug proceeds, common given Houston’s place on trafficking routes.
• Bank reports: Institutions must file Suspicious Activity Reports (SARs) and Currency Transaction Reports (CTRs). A flagged deposit pattern is often the first domino, putting you under review before anyone accuses you of anything.

By the time agents make contact, they may already hold years of statements and transaction histories — which is why the earliest moments matter most.

The Department of Justice has also shifted toward charging individuals — executives, controllers, and the people who signed off — not just companies. These cases move quietly on the surface but are moving underneath the whole time.

The two costliest early mistakes

As a former federal prosecutor, our managing partner watched the same two errors sink otherwise defensible cases.

The first is deleting or “cleaning up” records. Obstruction is often easier to prove than the underlying conduct, because the government can show what existed, what was removed, and when. Preserved evidence, produced strategically through counsel, can do the opposite — sometimes reducing exposure or improving your position.

The second is putting your head in the sand. Ignoring a financial investigation just lets the government build quietly while your options shrink. Acting early is about leverage, not a deadline — once the government gets there first, you’re reacting instead of deciding.

What a money laundering conviction puts at risk

Federal money laundering carries serious prison exposure, and federal time is served almost in full — there is no federal parole. But the number of years is not fixed by the charge alone.

Sentences are shaped by the advisory U.S. Sentencing Guidelines, and the single biggest driver is the amount the government says was laundered — which is why that figure, not the charge alone, often decides the case. More on that fight below, and in our guide to how federal sentences are calculated.

A conviction can also reach well beyond prison. Depending on the facts of your case, you may face:

• Asset forfeiture: Loss of money, homes, vehicles, and accounts the government links to the alleged offense.
• Immigration consequences: For non-citizens, certain convictions can trigger removal. Under Padilla v. Kentucky, your lawyer must advise you on those effects before any plea.
• Professional and financial fallout: Bankers, accountants, business owners, and licensed professionals can lose the credentials and banking relationships their livelihood depends on.

None of these outcomes is automatic. How early and how well the case is defended shapes every one.

Where Houston money laundering cases are actually won: the numbers

In a financial case, the amount of money at issue is the engine of the sentence — the value of the funds the government says were laundered drives the advisory Guidelines range more than almost any other single fact.

That figure is not handed down on stone tablets. It’s usually a spreadsheet built on assumptions, and the defense job is to test every cell — you don’t just plead, you litigate the math.

Because the Guidelines step up at set dollar thresholds, pushing the government’s number below a breakpoint can drop the recommended range in real, countable steps — each threshold can mean time back. Three places we press hardest:

• Credits against the figure: money with a genuine lawful source, or value legitimately provided, shouldn’t be counted as laundered proceeds.
• Double counting: the same dollar sometimes gets counted twice — across separate counts, transactions, or “victims” — inflating the total.
• Speculative or attributed amounts: funds attributed to you that you never actually controlled, or an “intended” figure that was never realistically achievable, don’t belong in the calculation.

Where the alleged proceeds come from fraud, the § 2B1.1 loss analysis that governs the underlying fraud feeds directly into laundering exposure — so the fight over fraud loss and the fight over the laundered amount become one fight, and winning it narrows both. The U.S. Sentencing Commission sets and periodically revises these numbers, and there is no federal parole, so every level litigated matters.

One enhancement to watch: “sophisticated means”

The “sophisticated means” enhancement is a prosecutor favorite, and easier to trigger than the name suggests. Even moving money between a main account and a shell or secondary account to obscure spending can draw it — no offshore maze or nominee owners required. Because laundering is about moving money, prosecutors reach for it early. We push back three ways:

• Legitimate-business explanation: the separate entities or accounts were real LLCs formed for ordinary tax or business reasons, not to hide anything.
• Deconstruction: show the conduct wasn’t a layered, coordinated scheme but a set of repetitive, simple transactions.
• Proportionality: measured against genuinely sophisticated operations, routine paperwork and a second bank account shouldn’t qualify.

If the conduct was routine, the enhancement shouldn’t apply — and because these adjustments stack, knocking out even one can move the range on its own. A simplified illustration, and only that: trim the government’s figure below the next threshold with credits and tracing, knock out a “sophisticated means” enhancement, and earn acceptance-of-responsibility credit, and the picture can change materially. That’s not a promise of any particular sentence — just proof that the math is litigable, and every level fought is time back.

Asset forfeiture — the fight that starts before trial

For most money laundering defendants, the first real blow isn’t the indictment. It’s the day the government freezes the accounts.

Federal law lets prosecutors move to seize assets they claim are connected to laundering — often before trial, and sometimes before charges are even filed. That can mean frozen bank accounts, a lis pendens on a home, or seized vehicles. A frozen account can shut down a business, choke off payroll, and limit your ability to pay for a defense.

We treat forfeiture as a front-line battle — challenging the government’s tracing, fighting to release funds not tied to any crime, and contesting seizures that sweep in legitimate, commingled money. If your accounts are already frozen, get in front of the forfeiture issue now — the timelines here are short and unforgiving.

How we defend money laundering cases

The best time to shape a financial case is before it’s charged. Getting involved during the investigation lets us narrow the government’s theory — sometimes keeping counts from being filed at all. Our defense turns on the pressure points that actually move these cases:

• No knowledge the funds were illicit: Both statutes require that you knew the money came from crime. If you handled funds you reasonably believed were legitimate, the government’s case fails at its core.
• No intent to conceal or promote: For § 1956, moving money isn’t enough — prosecutors must prove an unlawful purpose. Ordinary transactions are not laundering.
• Legitimate source of funds: We build the documentary record showing the money came from lawful business or income.
• Tracing and commingling disputes: The government’s math often assumes every dollar in an account is dirty. When legitimate and alleged proceeds are mixed, we challenge the tracing and force it to prove its numbers.
• Attacking the predicate: No specified unlawful activity, no laundering. We press the underlying charge hard, because it holds the laundering count up.
• Suppression: We examine every search, seizure, subpoena, and financial warrant for constitutional violations, because evidence gathered illegally can be kept out.
• Negotiation from strength and trial: We prepare every case as if it’s headed to trial at the Bob Casey courthouse. When the government won’t offer a fair resolution, founding partner Trey Keith has spent 20-plus years earning “Not Guilty” verdicts.

At sentencing, we litigate the laundered-amount calculation, acceptance of responsibility, and every fact that lowers exposure. Ask our team to review your options.

Getting ahead of it: pre-charge internal reviews

Many sophisticated organizations no longer wait for a subpoena or a raid. They bring in counsel early to find vulnerabilities, tighten internal controls, and review financial practices before a small issue becomes a catastrophic one.

When concerns surface, we start with an immediate assessment — evaluating exposure, preserving privilege, gauging investigative risk, and setting a strategy. Where it’s warranted, we conduct a discreet internal investigation, reviewing records and interviewing witnesses. And when the situation calls for it, we manage controlled engagement with the agencies involved — DOJ, the FBI, IRS-CI, HHS-OIG, or the U.S. Attorney’s Office — so the company, family office, or financial institution speaks with one measured voice.

Why choose Keith & Lorfing

Financial cases reward lawyers who have seen how the government builds them.

• A former federal prosecutor leads the firm. Managing partner Russell Lorfing is a former Assistant U.S. Attorney, a 2024 Super Lawyers honoree, and in 2024 was selected Co-Chair of the Federal Criminal Defense Committee for the Texas Criminal Defense Lawyers Association. Recognized for white-collar work by the IRS, DHS, and FBI, he has even lectured bankers on financial-crime compliance in a talk titled “A Banker’s Guide to Money Laundering” — so he knows these cases from the compliance desk as well as the courtroom.
• A retired federal judge sits of counsel. The Hon. E. Scott Frost (Ret.) brings more than 30 years of federal courtroom experience.
• A veteran trial lawyer at the founding chair. Trey Keith has defended the accused for over 20 years, with many “Not Guilty” verdicts.
• A deep bench. Our team includes former federal prosecutors and defenders, former FBI agents, former IRS criminal investigators, and former general counsel to large family offices — so we’ve seen these problems from the compliance desk, the investigation, and the courtroom.
• Admitted where your case lives. Russell Lorfing is admitted in the Southern District of Texas, along with the Northern and Western Districts, the Fifth Circuit, and the U.S. Supreme Court.

Past results never guarantee a future outcome. Every case turns on its own facts, and we’ll tell you straight what yours looks like.

What to expect in the federal process

Money laundering cases move quietly, then all at once. Here’s the general route a Houston case follows:

• Investigation: IRS-CI, the FBI, or the DEA gathers financial records, often for months. Subpoenas, target letters, and seizures surface here.
• Charging: The government files charges by indictment or information in the Southern District of Texas.
• Initial appearance and detention: You appear before a magistrate judge, who decides on release or detention.
• Forfeiture proceedings: Fights over seized and frozen assets often run in parallel, on their own timeline.
• Pretrial: Both sides exchange discovery, and the defense files motions to suppress or dismiss counts.
• Resolution: The case ends in a negotiated plea or a trial before a district judge at the Bob Casey courthouse.
• Sentencing: On a conviction, the court sets a sentence guided by the advisory Guidelines, with the laundered amount as a central factor.

You can reach our firm at any stage — the earlier, the better.

Talk to a Houston money laundering defense team before the government moves on your accounts

A money laundering investigation is frightening, especially when your money, your business, and your family’s stability are all on the line. But you have options — and the sooner you use them, the more room there is to change the outcome.

Keith & Lorfing defends money laundering and structuring cases throughout the Southern District of Texas. We’ll tell you honestly what you’re facing and start building a defense — including the fight over your frozen assets.

Schedule a confidential consultation with our federal criminal defense team.