BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 298 (Block) - Money laundering: interception of electronic
communications
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|Version: February 23, 2015 |Policy Vote: PUB. S. 6 - 0 |
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|Urgency: No |Mandate: No |
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|Hearing Date: April 27, 2015 |Consultant: Jolie Onodera |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: SB 298 would add money laundering for criminal
profiteering to the list of offenses for which interception of
electronic communications may be ordered, as specified.
Fiscal Impact:
Potential future increase in state costs (General Fund) to the
extent expanding the authorization for electronic
interceptions to the offense of money laundering leads to
additional state prison commitments. Although data from the
CDCR indicates fewer than five individuals per year are
committed to state prison under the money laundering
provisions of law, the cumulative future cost of even one
additional commitment per year, assuming an average length of
stay in excess of one year, would exceed $50,000 (General
Fund).
Potential increase in non-reimbursable local costs (Local) to
the extent expanding the authorization for electronic
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interceptions to the offense of money laundering leads to
additional felony jail terms.
Non-reimbursable local law enforcement costs (Local) for
additional electronic interception authorizations ordered,
potentially offset to a degree by related savings as a result
of more efficient law enforcement practices.
Minor ongoing costs (General Fund) to the DOJ to include
additional data in its detailed annual report on electronic
interceptions.
Background: State wiretap law was originally enacted in 1989 and granted
law enforcement officers the right to use wiretapping while
investigating specific types of crimes. SB 1428 (Pavley) Chapter
707/2010 expanded the use of wiretapping to include the
interception of modern types of electronic communications.
The number of electronic interception orders in California
averaged approximately 700 from 2011 to 2013, with an increase
of 44 percent in 2014 as reported by the DOJ. According to the
DOJ 2013 California Electronic Interceptions Report, 674
interception orders were authorized in 22 counties, leading to
799 arrests and 85 convictions. The DOJ 2014 California
Electronic Interceptions Report indicates 971 interception
orders were authorized in 23 counties, leading to 482 arrests.
The majority of these arrests are currently pending prosecution,
with 41 convictions reported to date. The crimes for which
arrests were made vary, but charges were largely narcotics- (73
percent) or gang- (23 percent) related.
Electronic interceptions are used as an investigative tool, one
of many at law enforcement's disposal. As one example of the
significant impact of electronic intercepts and their importance
as a tool for law enforcement agencies to use in investigating
crimes involving narcotics transactions, criminal street gangs,
and violence, the DOJ 2012 report cites the seizure of over $1.3
million, 799 pounds of methamphetamine, and 65 kilograms of
cocaine in Imperial County due to the assistance of 15
electronic intercept orders.
Current law authorizes the Attorney General or the district
attorney to apply to the Superior Court for an order authorizing
interception of a wire or electronic communication under
specified circumstances. The crimes for which an electronic
interception order may be sought include murder, solicitation to
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commit murder, bombing, use or threat to use weapons of mass
destruction, criminal gang activity, human trafficking, and
importation, possession for sale, transportation, manufacture or
sale of heroin, cocaine, PCP, or methamphetamine. Written
reports must be submitted at the discretion of the court, but at
least every 10 days, to the judge who issues the order.
Current law requires the Attorney General to prepare and submit
a detailed annual report to the Legislature, the Judicial
Council, and the Director of the Administrative Office of the
Courts on electronic interceptions conducted during the
preceding year. Information for this report is to be provided to
the Attorney General by any prosecutorial agency seeking an
electronic interception order.
Proposed Law:
This bill would add money laundering to the list of offenses
for which interception of electronic communications may be
ordered, subject to both of the following circumstances:
The offense is committed for the benefit of, at the
direction of, or in association with, an ongoing
organization, association, or group of three or more
persons, whether formal or informal, who collectively
engage in or have engaged in a pattern of criminal
profiteering activity, as specified.
The value of the transaction or transactions exceeds
$50,000.
Prior
Legislation: SB 955 (Mitchell) Chapter 712/2014 added human trafficking to
the list of offenses for which interception of electronic
communications may be ordered.
SB 35 (Pavley) Chapter 745/2014 extends the provisions
authorizing the use of electronic interceptions from January 1,
2015, to January 1, 2020.
AB 569 (Portantino) Chapter 391/2007 extended the provisions
authorizing the use of wiretaps by law enforcement to January 1,
2012.
SB 1428 (Pavley) Chapter 707/2010 expanded the scope of
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wiretapping provisions to include the interception of modern
types of electronic communications. This bill also proposed to
extend the sunset on wiretap provisions to January 1, 2014,
however, the provision was amended out of the chaptered version
of the bill.
SB 61 (Pavley) Chapter 663/2011 extended the sunset on wiretap
provisions to January 1, 2015.
Staff
Comments: It is unknown how many additional electronic interception
orders would be authorized under the offense of money laundering
for criminal profiteering, or how many arrests, convictions, and
jail or prison commitments would result directly from their use.
In order to obtain intercept authority, law enforcement must
already be investigating specific criminal activity, with
electronic interceptions to be used after all other normal
investigative procedures have been exhausted. It is unclear how
many investigations could have led to successful convictions
even in the absence of electronic interceptions. Moreover,
electronic interception evidence makes it more difficult to
prove a defendant's innocence and could ultimately result in an
indeterminable level of reduced trial and incarceration costs to
the extent that a defendant is more likely to plea bargain due
to the existence of electronic interception evidence of his or
her guilt. Nonetheless, if even one or two additional defendants
are sentenced to state prison directly attributable to an
electronic interception ordered under the expanded authority
provided by this bill, the annual costs would exceed the
threshold for referral to the Suspense File.
Because sentence lengths for money laundering offenses are
dependent on the value of the transactions involved, it is also
unknown how long each additional commitment to jail or prison
would remain incarcerated. Money laundering is punishable by
imprisonment in a county jail for not more than one year, or in
county jail/state prison for 16 months, two or three years (PC §
1170(h)), by a fine of not more than $250,000 or twice the value
of the property transacted, whichever is greater, or by both
that imprisonment and fine. Each individual transaction in
excess of $5,000, each series of transactions conducted within a
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seven-day period that total in excess of $5,000, or each series
of transactions conducted within a 30-day period that total in
excess of $25,000, constitute a separate, punishable offense.
A person punished under PC § 1170(h) is also subject to an
additional term of imprisonment based on the value of the
transactions, with additional terms ranging from one year to
four years in addition to and consecutive to the felony
punishment otherwise imposed.
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