STATE OF NEW YORK
        ________________________________________________________________________
                                         5578--A
                               2015-2016 Regular Sessions
                    IN SENATE
                                      May 14, 2015
                                       ___________
        Introduced  by  Sen.  AVELLA -- read twice and ordered printed, and when
          printed to be committed to the Committee on Codes  --  recommitted  to
          the  Committee  on  Codes  in accordance with Senate Rule 6, sec. 8 --
          committee discharged, bill amended, ordered reprinted as  amended  and
          recommitted to said committee
        AN  ACT  to  amend  the  penal  law, in relation to establishing certain
          offenses relating to structuring, money laundering and defrauding  the
          government;  to amend the tax law, in relation to eliminating the one-
          year time requirement for aggregation  payments  and  in  relation  to
          disclosure  of  certain  tax returns to a grand jury; and to amend the
          criminal procedure law, in relation to  geographical  jurisdiction  of
          offenses
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Section 470.00 of the penal law is amended by adding  three
     2  new subdivisions 11, 12 and 13 to read as follows:
     3    11.  "Structures"  for  purposes of sections 470.30 and 470.31 of this
     4  article, a person structures a transaction  when,  with  the  intent  to
     5  evade  any reporting requirement under the New York state banking law or
     6  31 U.S.C. §§ 5311 through 5326, or any regulation prescribed thereunder,
     7  he or she conducts or attempts to conduct one  or  more  related  trans-
     8  actions  in  currency,  in any amount, with one or more financial insti-
     9  tutions, on one or more days. Structuring includes, but is  not  limited
    10  to, the breaking down of a single sum of currency exceeding ten thousand
    11  dollars  into  smaller  sums,  including  sums  at or below ten thousand
    12  dollars, or the conduct of a transaction, or series of  currency  trans-
    13  actions,  including  transactions  at or below ten thousand dollars. The
    14  transaction or transactions need not  exceed  the  ten  thousand  dollar
    15  reporting threshold at any single financial institution or on any single
    16  day in order to constitute structuring.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD11108-02-6

        S. 5578--A                          2
     1    12.  "Monetary  transaction"  means  a  deposit,  withdrawal, transfer
     2  between accounts, exchange  of  currency,  loan,  extension  of  credit,
     3  purchase  or  sale  of any stock, bond, certificate of deposit, or other
     4  monetary instrument, use of a safe deposit box, or  any  other  payment,
     5  transfer,  or  delivery  by,  through, or to a financial institution, by
     6  whatever means effected, except that "monetary  transaction"  shall  not
     7  include  any  transaction  involving bona fide payments to attorneys for
     8  legal services.
     9    13. "Property derived from specified criminal conduct" means any prop-
    10  erty constituting, or  derived  from,  proceeds  of  specified  criminal
    11  conduct, and need not exclusively constitute or be derived from proceeds
    12  of specified criminal conduct.
    13    §  2.  The  penal  law  is amended by adding four new sections 470.30,
    14  470.31, 470.32 and 470.33 to read as follows:
    15  § 470.30 Structuring in the second degree.
    16    A person is guilty of structuring in the second degree when, with  the
    17  intent to evade any reporting requirement under the New York state bank-
    18  ing  law or 31 U.S.C. §§ 5311 through 5326, or any regulation prescribed
    19  thereunder, he or she structures one or more transactions.
    20    Structuring in the second degree is a class E felony.
    21  § 470.31 Structuring in the first degree.
    22    A person is guilty of structuring in the first degree when he  or  she
    23  commits  the  crime  of  structuring  in  the second degree and: (1) the
    24  conduct is committed with an intent to commit another crime or to aid or
    25  conceal the commission of another crime; or (2) the aggregate  value  of
    26  the  currency  reported  or  the currency that should have been reported
    27  exceeds one hundred thousand dollars in any twelve-month period.
    28    Structuring in the first degree is a class D felony.
    29  § 470.32 Criminal monetary transaction in the second degree.
    30    A person is guilty of engaging in a criminal monetary  transaction  in
    31  the second degree when he or she knowingly engages or attempts to engage
    32  in a monetary transaction in property derived from criminal conduct with
    33  a value greater than twenty thousand dollars and the property is derived
    34  from specified criminal conduct.
    35    Criminal  monetary transaction in the second degree is a class E felo-
    36  ny.
    37  § 470.33 Criminal monetary transaction in the first degree.
    38    A person is guilty of engaging in a criminal monetary  transaction  in
    39  the  first degree when he or she knowingly engages or attempts to engage
    40  in a monetary transaction in property derived from criminal conduct with
    41  a value greater than sixty thousand dollars and the property is  derived
    42  from specified criminal conduct.
    43    Criminal monetary transaction in the first degree is a class D felony.
    44    §  3.  Subdivision 3 of section 470.03 of the penal law, as amended by
    45  section 17 of part A of chapter 1 of the laws of  2004,  is  amended  to
    46  read as follows:
    47    3.  For  purposes of sections 470.32 and 470.33 of this article, mone-
    48  tary transactions may be considered together and the value of the  prop-
    49  erty derived from specified criminal conduct may be aggregated, provided
    50  that the monetary transactions are all part of a single "criminal trans-
    51  action"  as  defined in subdivision two of section 40.10 of the criminal
    52  procedure law.
    53    4. Nothing in sections 470.05,  470.21,  470.22,  470.23  and  470.24;
    54  paragraph  (b)  of subdivision one, paragraph (b) of subdivision two and
    55  paragraph (b) of subdivision three of section 470.10; paragraph  (b)  of
    56  subdivision  one,  paragraph (b) of subdivision two and paragraph (b) of

        S. 5578--A                          3
     1  subdivision three of section 470.15; [or] paragraph (b)  of  subdivision
     2  one  and  paragraph (b) of subdivision two of section 470.20; or section
     3  470.32 or section 470.33 of this  article  shall  make  it  unlawful  to
     4  return funds held in escrow:
     5    (a)  as  a portion of a purchase price for real property pursuant to a
     6  contract of sale; or
     7    (b) to satisfy the tax or other lawful obligations arising out  of  an
     8  administrative or judicial proceeding concerning the person who provided
     9  the escrow funds.
    10    § 4. Section 470.25 of the penal law, as amended by chapter 489 of the
    11  laws of 2000, is amended to read as follows:
    12  § 470.25 Money laundering and criminal monetary transactions; fines.
    13    1.  Any  person  convicted  of  a violation of section 470.05, 470.10,
    14  470.15, or 470.20 of this article may be sentenced to pay a fine not  in
    15  excess  of two times the value of the monetary instruments which are the
    16  proceeds of specified criminal activity. When a fine is imposed pursuant
    17  to this subdivision, the court shall make a finding as to the  value  of
    18  such  monetary instrument or instruments. If the record does not contain
    19  sufficient evidence to support such a finding the court  may  conduct  a
    20  hearing upon the issue. In imposing a fine, the court shall consider the
    21  seriousness of the conduct, whether the amount of the fine is dispropor-
    22  tionate  to  the  conduct in which he engaged, its impact on victims, as
    23  well as the economic circumstances of the  convicted  person,  including
    24  the effect of the imposition of such a fine upon his immediate family.
    25    2.  Any person convicted of a violation of section 470.32 or 470.33 of
    26  this article may be sentenced to pay a fine not in excess of  two  times
    27  the value of the monetary transaction which is the proceeds of specified
    28  criminal  conduct.  When a fine is imposed pursuant to this subdivision,
    29  the court shall make a finding as to the value of such  monetary  trans-
    30  action.  If  the  record does not contain sufficient evidence to support
    31  such a finding the court may conduct a hearing upon the issue. In impos-
    32  ing a fine, the court shall consider the  seriousness  of  the  conduct,
    33  whether  the  amount  of  the fine is disproportionate to the conduct in
    34  which he engaged, its impact on victims, as well as the economic circum-
    35  stances of the convicted person, including the effect of the  imposition
    36  of such a fine upon his immediate family.
    37    3.  The  imposition  of  a  fine  pursuant  to subdivision one of this
    38  section or paragraph b of subdivision one of section 80.00 of this chap-
    39  ter, shall preclude the imposition of any other  order  or  judgment  of
    40  forfeiture or fine based upon the same criminal conduct.
    41    §  5.  Paragraph  (a)  of subdivision 1 of section 460.10 of the penal
    42  law, as amended by chapter 368 of the laws of 2015, is amended  to  read
    43  as follows:
    44    (a)  Any  of  the felonies set forth in this chapter: sections 120.05,
    45  120.10 and 120.11 relating to assault; sections 121.12 and 121.13 relat-
    46  ing to strangulation; sections 125.10 to 125.27  relating  to  homicide;
    47  sections 130.25, 130.30 and 130.35 relating to rape; sections 135.20 and
    48  135.25  relating  to  kidnapping; sections 135.35 and 135.37 relating to
    49  labor trafficking; section 135.65 relating to coercion; sections 140.20,
    50  140.25 and 140.30 relating to  burglary;  sections  145.05,  145.10  and
    51  145.12 relating to criminal mischief; article one hundred fifty relating
    52  to  arson;  sections 155.30, 155.35, 155.40 and 155.42 relating to grand
    53  larceny; sections 177.10, 177.15, 177.20 and 177.25 relating  to  health
    54  care  fraud;  article  one  hundred  sixty relating to robbery; sections
    55  165.45, 165.50, 165.52 and 165.54 relating  to  criminal  possession  of
    56  stolen  property; sections 165.72 and 165.73 relating to trademark coun-

        S. 5578--A                          4
     1  terfeiting; sections 170.10, 170.15, 170.25, 170.30, 170.40, 170.65  and
     2  170.70  relating to forgery; sections 175.10, 175.25, 175.35, 175.40 and
     3  210.40 relating to false statements; sections 176.15, 176.20, 176.25 and
     4  176.30  relating to insurance fraud; sections 178.20 and 178.25 relating
     5  to criminal diversion of  prescription  medications  and  prescriptions;
     6  sections 180.03, 180.08, 180.15, 180.25, 180.40, 180.45, 200.00, 200.03,
     7  200.04,  200.10, 200.11, 200.12, 200.20, 200.22, 200.25, 200.27, 200.56,
     8  215.00, 215.05 and 215.19 relating to bribery; sections 187.10,  187.15,
     9  187.20  and  187.25  relating  to  residential  mortgage fraud, sections
    10  190.40 and 190.42 relating to criminal usury; section 190.65 relating to
    11  schemes to defraud; any felony defined in article four  hundred  ninety-
    12  six;  sections  205.60  and  205.65  relating  to hindering prosecution;
    13  sections 210.10, 210.15, and 215.51 relating to  perjury  and  contempt;
    14  section  215.40  relating  to tampering with physical evidence; sections
    15  220.06, 220.09, 220.16, 220.18, 220.21, 220.31, 220.34, 220.39,  220.41,
    16  220.43, 220.46, 220.55, 220.60, 220.65 and 220.77 relating to controlled
    17  substances;  sections  225.10  and 225.20 relating to gambling; sections
    18  230.25, 230.30, and 230.32 relating to promoting  prostitution;  section
    19  230.34  relating to sex trafficking; sections 235.06, 235.07, 235.21 and
    20  235.22 relating to obscenity; sections 263.10  and  263.15  relating  to
    21  promoting  a  sexual  performance  by  a child; sections 265.02, 265.03,
    22  265.04, 265.11, 265.12, 265.13 and  the  provisions  of  section  265.10
    23  which constitute a felony relating to firearms and other dangerous weap-
    24  ons;  sections 265.14 and 265.16 relating to criminal sale of a firearm;
    25  section 275.10, 275.20,  275.30,  or  275.40  relating  to  unauthorized
    26  recordings; [and] sections 470.05, 470.10, 470.15 and 470.20 relating to
    27  money  laundering;  sections  470.30 and 470.31 relating to structuring;
    28  and sections 470.32 and 470.33 relating to criminal money  transactions;
    29  or
    30    §  6.  Section 195.20 of the penal law, as amended by chapter 1 of the
    31  laws of 2010, is amended to read as follows:
    32  § 195.20 Defrauding the government in the fourth degree.
    33    A person is guilty of defrauding the government in the  fourth  degree
    34  when[, being a public servant or party officer,] he or she:
    35    (a)  engages  in  a scheme constituting a systematic ongoing course of
    36  conduct with intent to:
    37    (i) defraud the state or a political subdivision of  the  state  or  a
    38  governmental  instrumentality  within  the  state or to obtain property,
    39  services or other resources from the state or a political subdivision of
    40  the state or a governmental instrumentality within the state by false or
    41  fraudulent pretenses, representations or promises; or
    42    (ii) defraud the state or a political subdivision of the  state  or  a
    43  governmental instrumentality within the state by making use of property,
    44  services  or  resources of the state, political subdivision of the state
    45  or a governmental instrumentality within the state for private  business
    46  purposes or other compensated non-governmental purposes; [and] or
    47    (iii)  defraud  the state or a political subdivision of the state or a
    48  public authority, public benefit corporation, or  municipal  corporation
    49  of  the  state,  or any instrumentality thereof, of one or more forms of
    50  revenue, and so evades payment of any tax, insurance  premium,  contrib-
    51  ution,  or fee, or any portion thereof, owed to the state or a political
    52  subdivision, public authority, public benefit corporation  or  municipal
    53  corporation of the state or any instrumentality thereof, and
    54    (b) (i) with respect to an offense charged under paragraph (i) or (ii)
    55  of  subdivision  (a)  of  this section, so obtains property, services or

        S. 5578--A                          5
     1  other resources with a value in excess of one thousand dollars from such
     2  state, political subdivision or governmental instrumentality, or
     3    (ii)  with  respect  to  an  offense  charged under paragraph (iii) of
     4  subdivision (a) of this section,  the  aggregate  unpaid  tax,  premium,
     5  contribution or fee owed exceeds one thousand dollars.
     6    Defrauding the government in the fourth degree is a class E felony.
     7    §  7.  The  penal  law is amended by adding three new sections 195.22,
     8  195.25 and 195.27 to read as follows:
     9  § 195.22 Defrauding the government in the third degree.
    10    A person is guilty of defrauding the government in  the  third  degree
    11  when he or she:
    12    (a)  engages  in  a scheme constituting a systematic ongoing course of
    13  conduct with intent to:
    14    (i) defraud the state or a political subdivision of  the  state  or  a
    15  governmental  instrumentality  within  the  state or to obtain property,
    16  services or other resources from the state or a political subdivision of
    17  the state or a governmental instrumentality within the state by false or
    18  fraudulent pretenses, representations or promises; or
    19    (ii) defraud the state or a political subdivision of the  state  or  a
    20  governmental instrumentality within the state by making use of property,
    21  services  or  resources of the state, political subdivision of the state
    22  or a governmental instrumentality within the state for private  business
    23  purposes or other compensated non-governmental purposes; or
    24    (iii)  defraud  the state or a political subdivision of the state or a
    25  public authority, public benefit corporation, or  municipal  corporation
    26  of  the  state,  or any instrumentality thereof, of one or more forms of
    27  revenue, and so evades payment of any tax, insurance  premium,  contrib-
    28  ution,  or fee, or any portion thereof, owed to the state or a political
    29  subdivision, public authority, public benefit corporation  or  municipal
    30  corporation of the state or any instrumentality thereof, and
    31    (b) (i) with respect to an offense charged under paragraph (i) or (ii)
    32  of  subdivision  (a)  of  this section, so obtains property, services or
    33  other resources with a value in excess of ten thousand dollars from such
    34  state, political subdivision or governmental  instrumentality,  or  (ii)
    35  with  respect to an offense charged under paragraph (iii) of subdivision
    36  (a) of this section, the aggregate unpaid tax, premium, contribution, or
    37  fee owed exceeds ten thousand dollars.
    38    Defrauding the government in the third degree is a class D felony.
    39  § 195.25 Defrauding the government in the second degree.
    40    A person is guilty of defrauding the government in the  second  degree
    41  when he or she:
    42    (a)  engages  in  a scheme constituting a systematic ongoing course of
    43  conduct with intent to:
    44    (i) defraud the state or a  political  subdivision  of  the  state  or
    45  governmental  instrumentality  within  the  state or to obtain property,
    46  services or other resources from the state or a political subdivision of
    47  the state or a governmental instrumentality within the state by false or
    48  fraudulent pretenses, representations or promises; or
    49    (ii) defraud the state or a political subdivision of the  state  or  a
    50  governmental instrumentality within the state by making use of property,
    51  services  or  resources of the state, political subdivision of the state
    52  or a governmental instrumentality within the state for private  business
    53  purposes or other compensated non-governmental purposes; or
    54    (iii)  defraud  the state or a political subdivision of the state or a
    55  public authority, public benefit corporation, or  municipal  corporation
    56  of  the  state,  or any instrumentality thereof, of one or more forms of

        S. 5578--A                          6
     1  revenue, and so evades payment of any tax, insurance  premium,  contrib-
     2  ution, or fee, or any portion thereof, owned to the state or a political
     3  subdivision,  public  authority, public benefit corporation or municipal
     4  corporation of the state or any instrumentality thereof, and
     5    (b)(i)  with respect to an offense charged under paragraph (i) or (ii)
     6  of subdivision (a) of this section, so  obtains  property,  services  or
     7  other  resources  with a value in excess of twenty-five thousand dollars
     8  from such state, political subdivision or governmental  instrumentality,
     9  or  (ii)  with  respect  to  an offense charged under paragraph (iii) of
    10  subdivision (a) of this section,  the  aggregate  unpaid  tax,  premium,
    11  contribution, or fee owed exceeds twenty-five thousand dollars.
    12    Defrauding the government in the second degree is a class C felony.
    13  § 195.27 Defrauding the government in the first degree.
    14    A  person  is  guilty of defrauding the government in the first degree
    15  when he or she:
    16    (a) engages in a scheme constituting a systematic  ongoing  course  of
    17  conduct with intent to:
    18    (i)  defraud  the  state  or a political subdivision of the state or a
    19  governmental instrumentality within the state  or  to  obtain  property,
    20  services or other resources from the state or a political subdivision of
    21  the  state  or governmental instrumentality within the state by false or
    22  fraudulent pretenses, representations or promises; or
    23    (ii) defraud the state or a political subdivision of the  state  or  a
    24  governmental instrumentality within the state by making use of property,
    25  services  or  resources of the state, political subdivision of the state
    26  or a governmental instrumentality within the state for private  business
    27  purposes or other compensated non-governmental purposes; or
    28    (iii)  defraud  the state or a political subdivision of the state or a
    29  public authority, public benefit corporation, or  municipal  corporation
    30  of  the  state,  or any instrumentality thereof, of one or more forms of
    31  revenue, and so evades payment of any tax, insurance  premium,  contrib-
    32  ution  or  fee, or any portion thereof, owed to the state or a political
    33  subdivision, public authority, public benefit corporation  or  municipal
    34  corporation of the state or any instrumentality thereof, and
    35    (b) (i) with respect to an offense charged under paragraph (i) or (ii)
    36  of  subdivision  (a)  of  this section, so obtains property, services or
    37  other resources with a value in excess of  two  hundred  fifty  thousand
    38  dollars  from  such state, political subdivision or governmental instru-
    39  mentality, or (ii) with respect to an offense  charged  under  paragraph
    40  (iii)  of  subdivision  (a)  of  this section, the aggregate unpaid tax,
    41  premium, contribution or fee owed exceeds  two  hundred  fifty  thousand
    42  dollars.
    43    Defrauding the government in the first degree is a class B felony.
    44    § 8. Section 1807 of the tax law, as amended by section 5 of subpart A
    45  of  part  S  of  chapter  57  of the laws of 2010, is amended to read as
    46  follows:
    47    § 1807. Aggregation. For purposes of this article,  the  payments  due
    48  and not paid under a single article of this chapter pursuant to a common
    49  scheme or plan or due and not paid, [within one year,] may be charged in
    50  a  single  count,  and  the  amount of underpaid tax liability incurred,
    51  within one year, may be aggregated in a single count.
    52    § 9. Subsection (e) of section 697 of the tax law is amended by adding
    53  a new paragraph (3-b) to read as follows:
    54    (3-b)  Notwithstanding  the  provisions  of  paragraph  one  of   this
    55  subsection,  or any other law to the contrary, an officer or employee of
    56  the department so  designated  by  the  commissioner  may  disclose  tax

        S. 5578--A                          7
     1  returns  or tax return information in response to a subpoena duces tecum
     2  issued by a grand jury pursuant  to  the  criminal  procedure  law  duly
     3  served  upon  the  department  and an order of the court that empanelled
     4  such  grand  jury  determining, based on a written application submitted
     5  under oath or penalty of perjury, that: (i) there is reasonable cause to
     6  believe, based upon information believed to be reliable, that a specific
     7  criminal act has been committed;  (ii)  there  is  reasonable  cause  to
     8  believe  that  the return or return of information is or may be relevant
     9  to a matter relating to the commission of such act; and (iii) the return
    10  or return of information is sought exclusively for  use  in  a  criminal
    11  investigation  or  proceeding  concerning  such act, and the information
    12  sought to be disclosed cannot reasonably be obtained, under the  circum-
    13  stances, from another source.
    14    §  10. Paragraph (c) of subdivision 2 of section 20.40 of the criminal
    15  procedure law is amended to read as follows:
    16    (c) Such conduct had, or was likely to have, a particular effect  upon
    17  such  county  or  a  political  subdivision  or  part  thereof, [and was
    18  performed with intent that it would, or with knowledge that it was like-
    19  ly to, have such particular effect therein] or on a city of  which  such
    20  county  is a part, whether or not such conduct also had effects on other
    21  counties or on the state as a whole; provided that, if such conduct  had
    22  or  was likely to have such particular effect upon the state as a whole,
    23  then there shall be proper jurisdiction in the county of Albany in addi-
    24  tion to any counties particularly affected; or
    25    § 11. This act shall  take  effect  on  the  first  of  November  next
    26  succeeding the date on which it shall have become a law.