Money Laundering—Gary Reiner

A lawyer in Kittery, Maine has gone on trial on charges that he ran a prostitution ring and conspired to launder millions of dollars in profits.^[1] Gary Reiner is accused of running the Danish Health Club, a massage parlor where women were brought in from out of state to work as prostitutes.^[2] When the club was raided in 2004, a naked man wearing a condom was found with an attendant, and Assistant US Attorney Toby Dilworth said that Mr. Reiner’s case “is the largest money-laundering conspiracy in a number of years, if not the history of the District of Maine.”^[3]

Transporting Women Across State lines for the Purpose of Engaging in Prostitution
Under 18 U.S.C. § 2421, any person who knowingly transports any individual in interstate commerce with the intent that the individual engage in prostitution can be fined, imprisoned for up to ten years, or both.

Conspiracy to Launder Money
Under 18 U.S.C. § 1956(h), any person who conspires to commit a money laundering offense is subject to the same penalties as those prescribed for a completed commission of the offense. A money laundering offense involves a person who has the intent to promote the carrying on of a specified unlawful activity, and who conducts a financial transaction involving property represented to be the proceeds of that unlawful activity.^[4]

For the purposes of this case, the specified unlawful activity is transportation for the purpose of engaging in prostitution.^[5]

The punishment for violating section 1956 is a fine, imprisonment for up to 20 years, or both.^[6]

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[1] Lawyer Accused of Running Prostitution Ring Goes on Trial, Boston Globe, Sept. 26, 2005, available here.
[2] Id.
[3] Id.
[4] 18 U.S.C. § 1956(a)(3)(A).
[5] Id. § 1956(c)(7)(A) (incorporating list of offenses found in 18 U.S.C. § 1961(1) as “specified unlawful activity”).
[6] Id. § 1956(a)(3)(A).