Oil-for-Food Arrest Update

The Associated Press reports that Alexander Yakovlev pleaded guilty to accepting hundreds of thousands of dollars in bribes from U.N. contractors. See Nick Wadhams, Former U.N. Procurement Officer Pleads Guilty to Taking Bribes from U.N. Contractors, Associated Press, Aug. 8, 2005. See also this MSNBC.com report. According to the reports, Mr. Yakovlev pleaded guilty to charges of conspiracy, wire fraud, and money laundering.

Conspiracy
Conspiracy is a federal crime, criminalized by 18 U.S.C. § 371. Under section 371, it is a crime for two or more people to conspire to do either of the following:

• commit any offense against the United States, or
• defraud the United States.

A further requirement of conspiracy is that one or more of the conspirators must do some act in furtherance of the object of the conspiracy. The punishment for a conspiracy violation is a fine, imprisonment for not more than five years, or both.

Wire Fraud
Wire fraud is also a federal crime, criminalized by 18 U.S.C. § 1343. It is a violation of the wire fraud statute for a person who has devised a scheme to defraud or obtain money by false pretenses, to transmit information over the wires for the purpose of executing the scheme to defraud. Violating section 1343 can result in a punishment of a fine, imprisonment for not more 20 years, or both.

Money Laundering
Money laundering is both a federal crime and a transnational crime, criminalized by 18 U.S.C. §§ 1956 and 1957. There are three different ways to violate section 1956.

The first is for a person “knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity” to conduct or attempt to conduct such a financial transaction which in fact involves the proceeds of an unlawful activity—

• with the intent
• to promote the carrying on of specified unlawful activity, 18 U.S.C. § 1956(a)(1)(A)(i); or
• to engage in conduct constituting a violation 26 U.S.C. §§ 7201 or 7206 (relating to the Internal Revenue Code), 18 U.S.C. § 1956(a)(1)(A)(ii) ; or
• knowing that the transaction is designed in whole or in part—
• to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity, 18 U.S.C. § 1956(a)(1)(B)(i); or
• to avoid a transaction reporting requirement under State or Federal law. Id. § 1956(a)(1)(B)(ii).

The second way a person can violate section 1956, is for a person to

• transport, transmit, or transfer, (or attempt to transport, transmit, or transfer) a monetary instrument or funds from a place in the United States to or through a place outside the United States or to a place in the United States from or through a place outside the United States—
• with the intent to promote the carrying on of specified unlawful activity, 18 U.S.C. § 1956(a)(2)(A); or
• knowing that the monetary instrument or funds involved in the transportation represent the proceeds of some form of unlawful activity and knowing that such transportation, transmission, or transfer is designed in whole or in part—
• to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity, Id. § 1956(a)(2)(B)(i); or
• to avoid a transaction reporting requirement under State or Federal law. Id. § 1956(a)(2)(B)(ii).

And the final way to violate section 1956 is for a person to have the intent to

• promote the carrying on of specified unlawful activity, 18 U.S.C. § 1956(a)(3)(A);
• conceal or disguise the nature, location, source, ownership, or control of property believed to be the proceeds of specified unlawful activity, Id. § 1956(a)(3)(B); or
• avoid a transaction reporting requirement under State or Federal law, Id. § 1956(a)(3)(C),

and

• conduct or attempt to conduct a financial transaction involving property represented to be the proceeds of specified unlawful activity, or property used to conduct or facilitate specified unlawful activity. Id. § 1956(a)(3).

A violation of any of these sections can be punished by a fine, imprisonment for not more that 20 years, or both.

The other statute that involves money laundering, 18 U.S.C. § 1957, is very similar to the provisions of section 1956, except that the property in question must have a value greater than $10,000 and it must occur with United States jurisdiction. The punishment for a violation of section 1957 is a fine, imprisonment for not more than ten years, or both.

It is possible that the fact that Mr. Yakovlev has pleaded guilty so quickly means that he is cooperating with investigators in exchange for his testimony against someone higher up. Mr. Sevan, perhaps, or even Kofi Annan?