UNITED STATES v. SANTOS et al.

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507 OCTOBER TERM, 2007
Syllabus
UNITED STATES v. SANTOS et al.
certiorari to the united states court of appeals for
the seventh circuit
No. 06–1005. Argued October 3, 2007—Decided June 2, 2008
In an illegal lottery run by respondent Santos, runners took commissions
from the bets they gathered, and some of the rest of the money was
paid as salary to respondent Diaz and other collectors and to the win
ning gamblers. Based on these payments to runners, collectors, and
winners, Santos was convicted of, inter alia, violating the federal
money-laundering statute, 18 U. S. C. § 1956, which prohibits the use of
the “proceeds” of criminal activities for various purposes, including en
gaging in, and conspiring to engage in, transactions intended to promote
the carrying on of unlawful activity, § 1956(a)(1)(A)(i) and § 1956(h).
Based on his receipt of salary, Diaz pleaded guilty to conspiracy to laun
der money. The Seventh Circuit affirmed the convictions. On collat
eral review, the District Court ruled that, under intervening Circuit
precedent interpreting the word “proceeds” in the federal money
laundering statute, § 1956(a)(1)(A)(i) applies only to transactions involv
ing criminal profits, not criminal receipts. Finding no evidence that
the transactions on which respondents’ money-laundering convictions
were based involved lottery profits, the court vacated those convictions.
The Seventh Circuit affirmed.
Held: The judgment is affirmed.
461 F. 3d 886, affirmed.
Justice Scalia, joined by Justice Souter, Justice Thomas, and
Justice Ginsburg, concluded in Parts I–III and V that the term “pro
ceeds” in § 1956(a)(1) means “profits,” not “receipts.” Pp. 510–521, 524.
(a) The rule of lenity dictates adoption of the “profits” reading. The
statute nowhere defines “proceeds.” An undefined term is generally
given its ordinary meaning. Asgrow Seed Co. v. Winterboer, 513 U. S.
179, 187. However, dictionaries and the Federal Criminal Code some
times define “proceeds” to mean “receipts” and sometimes “profits.”
Moreover, the many provisions in the federal money-laundering statute
that use the word “proceeds” make sense under either definition. The
rule of lenity therefore requires the statute to be interpreted in favor
of defendants, and the “profits” definition of “proceeds” is always more
defendant-friendly than the “receipts” definition. Pp. 510–514.
(b) The Government’s contention that the “profits” interpretation
fails to give the money-laundering statute its intended scope begs the

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508 UNITED STATES v. SANTOS
Syllabus
question; the Government’s contention that the “profits” interpretation
hinders effective enforcement of the law is exaggerated. Neither suf
fices to overcome the rule of lenity. Pp. 514–521.
(c) None of the transactions on which respondents’ money-laundering
convictions were based can fairly be characterized as involving the lot
tery’s profits. P. 524.
Justice Scalia, joined by Justice Souter and Justice Ginsburg,
concluded in Part IV that Justice Stevens’ position that “proceeds”
should be interpreted to mean “profits” for some predicate crimes, “re
ceipts” for others, is contrary to this Court’s precedents holding that
judges cannot give the same statutory text different meanings in differ
ent cases, see Clark v. Martinez, 543 U. S. 371. Pp. 521–524.
Justice Stevens concluded that revenue a gambling business uses
to pay essential operating expenses is not “proceeds” under 18 U. S. C.
§ 1956. When, as here, Congress fails to define potentially ambiguous
statutory terms, it effectively delegates the task to federal judges. See
Commissioner v. Fink, 483 U. S. 89, 104. Because Congress could have
required that “proceeds” have one meaning when referring to some of
the specified unlawful activities listed in § 1956(c)(7) and a different
meaning when referring to others, judges filling statutory gaps may
also do so, as long as they are conscientiously endeavoring to carry out
Congress’ intent. Section 1956’s legislative history makes clear that
“proceeds” includes gross revenues from the sale of contraband and the
operation of organized crime syndicates involving such sales, but sheds
no light on how to identify the proceeds of an unlicensed stand-alone
gambling venture. Furthermore, the consequences of applying a “gross
receipts” definition of “proceeds” to respondents are so perverse that
Congress could not have contemplated them: Allowing the Government
to treat the mere payment of an illegal gambling business’ operating
expenses as a separate offense is in practical effect tantamount to double
jeopardy, which is particularly unfair in this case because the penalties
for money laundering are substantially more severe than those for the
underlying offense of operating a gambling business. Accordingly, the
rule of lenity may weigh in the determination, and in that respect the
plurality’s opinion is persuasive. Pp. 524–528.
Scalia, J., announced the judgment of the Court and delivered an opin
ion, in which Souter and Ginsburg, JJ., joined, and in which Thomas, J.,
joined as to all but Part IV. Stevens, J., filed an opinion concurring in
the judgment, post, p. 524. Breyer, J., filed a dissenting opinion, post,
p. 529. Alito, J., filed a dissenting opinion, in which Roberts, C. J., and
Kennedy and Breyer, JJ., joined, post, p. 531.

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Opinion of Scalia, J.
Matthew D. Roberts argued the cause for the United
States. With him on the briefs were former Solicitor Gen
eral Clement, Assistant Attorney General Fisher, Deputy
Solicitor General Dreeben, and Joel M. Gershowitz.
Todd G. Vare argued the cause for respondents. With him
on the brief for respondent Efrain Santos was Paul L. Jeffer
son. Stuart Altschuler filed a brief for respondent Bene
dicto Diaz.*
Justice Scalia announced the judgment of the Court and
delivered an opinion, in which Justice Souter and Justice
Ginsburg join, and in which Justice Thomas joins as to all
but Part IV.
We consider whether the term “proceeds” in the federal
money-laundering statute, 18 U. S. C. § 1956(a)(1), means “re
ceipts” or “profits.”
I
From the 1970’s until 1994, respondent Santos operated a
lottery in Indiana that was illegal under state law. See Ind.
Code § 35–45–5–3 (West 2004). Santos employed a number
of helpers to run the lottery. At bars and restaurants, San
tos’s runners gathered bets from gamblers, kept a portion of
the bets (between 15% and 25%) as their commissions, and
delivered the rest to Santos’s collectors. Collectors, one of
whom was respondent Diaz, then delivered the money to
Santos, who used some of it to pay the salaries of collectors
(including Diaz) and to pay the winners.
These payments to runners, collectors, and winners
formed the basis of a 10-count indictment filed in the United
States District Court for the Northern District of Indiana,
naming Santos, Diaz, and 11 others. A jury found Santos
guilty of one count of conspiracy to run an illegal gambling
business (18 U. S. C. § 371), one count of running an illegal
*Jeffrey T. Green and Pamela Harris filed a brief for the National Asso
ciation of Criminal Defense Lawyers as amicus curiae urging affirmance.

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gambling business (§ 1955), one count of conspiracy to laun
der money (§ 1956(a)(1)(A)(i) and § 1956(h)), and two counts of
money laundering (§ 1956(a)(1)(A)(i)). The court sentenced
Santos to 60 months of imprisonment on the two gambling
counts and to 210 months of imprisonment on the three
money-laundering counts. Diaz pleaded guilty to conspiracy
to launder money, and the District Court sentenced him to
108 months of imprisonment. The Court of Appeals af
firmed the convictions and sentences. United States v.
Febus, 218 F. 3d 784 (CA7 2000). We declined to review the
case. 531 U. S. 1021 (2000).
Thereafter, respondents filed motions under 28 U. S. C.
§ 2255, collaterally attacking their convictions and sentences.
The District Court rejected all of their claims but one, a
challenge to their money-laundering convictions based on the
Seventh Circuit’s subsequent decision in United States v.
Scialabba, 282 F. 3d 475 (2002), which held that the federal
money-laundering statute’s prohibition of transactions in
volving criminal “proceeds” applies only to transactions in
volving criminal profits, not criminal receipts. Id., at 478.
Applying that holding to respondents’ cases, the District
Court found no evidence that the transactions on which the
money-laundering convictions were based (Santos’s pay
ments to runners, winners, and collectors and Diaz’s receipt
of payment for his collection services) involved profits, as
opposed to receipts, of the illegal lottery, and accordingly
vacated the money-laundering convictions. The Court of
Appeals affirmed, rejecting the Government’s contention
that Scialabba was wrong and should be overruled. 461
F. 3d 886 (CA7 2006). We granted certiorari. 550 U. S.
902 (2007).
II
The federal money-laundering statute prohibits a number
of activities involving criminal “proceeds.” Most relevant to
this case is 18 U. S. C. § 1956(a)(1)(A)(i), which criminalizes

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transactions to promote criminal activity.1 This provision
uses the term “proceeds” in describing two elements of the
offense: The Government must prove that a charged transac
tion “in fact involve[d] the proceeds of specified unlawful ac
tivity” (the proceeds element), and it also must prove that a
defendant knew “that the property involved in” the charged
transaction “represent[ed] the proceeds of some form of un
lawful activity” (the knowledge element). § 1956(a)(1).
The federal money-laundering statute does not define
“proceeds.” When a term is undefined, we give it its ordi
nary meaning. Asgrow Seed Co. v. Winterboer, 513 U. S.
179, 187 (1995). “Proceeds” can mean either “receipts” or
“profits.” Both meanings are accepted, and have long been
accepted, in ordinary usage. See, e. g., 12 Oxford English
Dictionary 544 (2d ed. 1989); Random House Dictionary of
the English Language 1542 (2d ed. 1987); Webster’s New In
ternational Dictionary 1972 (2d ed. 1954) (hereinafter Web
ster’s 2d). The Government contends that dictionaries gen
erally prefer the “receipts” definition over the “profits”
definition, but any preference is too slight for us to conclude
that “receipts” is the primary meaning of “proceeds.”
“Proceeds,” moreover, has not acquired a common meaning
in the provisions of the Federal Criminal Code. Most leave
the term undefined. See, e. g., 18 U. S. C. § 1963; 21 U. S. C.
§ 853. Recognizing the word’s inherent ambiguity, Congress
1 Section 1956(a)(1) reads as follows: “Whoever, knowing that the prop
erty involved in a financial transaction represents the proceeds of some
form of unlawful activity, conducts or attempts to conduct such a financial
transaction which in fact involves the proceeds of specified unlawful activ
ity . . . (A)(i) with the intent to promote the carrying on of specified unlaw
ful activity . . . shall be sentenced to a fine of not more than $500,000 or
twice the value of the property involved in the transaction, whichever is
greater, or imprisonment for not more than twenty years, or both.”
Respondents were also convicted of conspiring to launder money under
§ 1956(h). Because the Government has not argued that respondents’ con
spiracy convictions could stand if “proceeds” meant “profits,” see 461 F. 3d
886, 889 (CA7 2006), we do not address that possibility.

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has defined “proceeds” in various criminal provisions, but
sometimes has defined it to mean “receipts” and some
times “profits.” Compare 18 U. S. C. § 2339C(e)(3) (2000 ed.,
Supp. V) (receipts), § 981(a)(2)(A) (2000 ed.) (same), with
§ 981(a)(2)(B) (profits).
Since context gives meaning, we cannot say the money
laundering statute is truly ambiguous until we consider “pro
ceeds” not in isolation but as it is used in the federal money
laundering statute. See United Sav. Assn. of Tex. v.
Timbers of Inwood Forest Associates, Ltd., 484 U. S. 365, 371
(1988). The word appears repeatedly throughout the stat
ute, but all of those appearances leave the ambiguity intact.
Section 1956(a)(1) itself, for instance, makes sense under
either definition: One can engage in a financial transaction
with either receipts or profits of a crime; one can intend to
promote the carrying on of a crime with either its receipts
or its profits; and one can try to conceal the nature, location,
etc., of either receipts or profits. The same is true of all the
other provisions of this legislation in which the term “pro
ceeds” is used. They make sense under either definition.
See, for example, § 1956(a)(2)(B), which speaks of “proceeds”
represented by a “monetary instrument or funds.”
Justice Alito’s dissent (the principal dissent) makes
much of the fact that 14 States that use and define the word
“proceeds” in their money-laundering statutes,2 the Model
2 The majority of States with money-laundering laws, in fact, use “pro
ceeds” without defining it. See Colo. Rev. Stat. Ann. § 18–18–408 (2007);
Fla. Stat. § 896.101 (2006); Ga. Code Ann. §§ 7–1–911, 7–1–915 (2004); Idaho
Code § 18–8201 (Lexis 2004); Ill. Comp. Stat., ch. 720, § 5/29B–1 (West
2006); Kan. Stat. Ann. § 65–4142 (2002); Minn. Stat. §§ 609.496 to 609.497
(2006); Miss. Code Ann. § 97–23–101 (2006); Mo. Rev. Stat. § 574.105 (2007
Supp.); Mont. Code Ann. § 45–6–341 (2007); Nev. Rev. Stat. § 207.195 (2007);
N. Y. Penal Law Ann. §§ 470.00 to 470.25 (West Supp. 2008); Okla. Stat.,
Tit. 63, § 2–503.1 (West 2001); Ore. Rev. Stat. § 164.170 (2007); 18 Pa. Cons.
Stat. § 5111 (2002); R. I. Gen. Laws § 11–9.1–15 (Supp. 2007); S. C. Code
Ann. § 44–53–475 (2002); Tenn. Code Ann. §§ 39–14–901 to 39–14–909
(2006). Courts in these States have not construed the term one way or

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Money Laundering Act, and an international treaty on the
subject, all define the term to include gross receipts. See
post, at 533–535. We do not think this evidence shows that
the drafters of the federal money-laundering statute used
“proceeds” as a term of art for “receipts.” Most of the state
laws cited by the dissent, the Model Act, and the treaty post
date the 1986 federal money-laundering statute by several
years, so Congress was not acting against the backdrop of
those definitions when it enacted the federal statute. If
anything, they show that “proceeds” is ambiguous and that
others who believed that money-laundering statutes ought
to include gross receipts sought to clarify the ambiguity that
Congress created when it left the term undefined.3
Under either of the word’s ordinary definitions, all provi
sions of the federal money-laundering statute are coherent;
the other. But cf. State v. Jackson, 124 S. W. 3d 139, 143 (Tenn. Crim.
App. 2003) (linking “proceeds” with the defined term “property”). Cali
fornia might belong in this list, for it has a money-laundering provision in
its Penal Code, in which it uses the term “proceeds” but does not define
it. See Cal. Penal Code Ann. § 186.10 (West 1999). But California also
has a more limited money-laundering statute that uses and defines “pro
ceeds.” See Cal. Health & Safety Code Ann. § 11370.9(h)(1) (West 2007).
Maryland might belong on the list as well: Its general money-laundering
statute defines “proceeds” simply to set a minimum value on the proceeds
laundered, Md. Crim. Law Code Ann. § 5–623(a)(5) (Lexis 2002) (“money or
any other property with a value exceeding $10,000”), and its more limited
money-laundering statute does not define the term, see § 11–304.
3 The principal dissent also suggests that Congress thought “proceeds”
meant “receipts” because the House of Representatives (but not the Sen
ate) had passed a money-laundering bill that did not use the word “pro
ceeds” but rather used and defined a term (“criminally derived property”)
that, perhaps, included receipts. See post, at 535, n. 5. Putting aside the
question whether resort to legislative history is ever appropriate when
interpreting a criminal statute, compare United States v. R. L. C., 503
U. S. 291, 306, n. 6 (1992), with id., at 307 (Scalia, J., concurring in part
and concurring in judgment), that bit of it is totally unenlightening be
cause we do not know why the earlier House terminology was rejected—
because “proceeds” captured the same meaning, or because “proceeds” car
ried a narrower meaning?

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no provisions are redundant; and the statute is not rendered
utterly absurd. From the face of the statute, there is no
more reason to think that “proceeds” means “receipts” than
there is to think that “proceeds” means “profits.” Under a
long line of our decisions, the tie must go to the defendant.
The rule of lenity requires ambiguous criminal laws to be
interpreted in favor of the defendants subjected to them.
See United States v. Gradwell, 243 U. S. 476, 485 (1917);
McBoyle v. United States, 283 U. S. 25, 27 (1931); United
States v. Bass, 404 U. S. 336, 347–349 (1971). This venerable
rule not only vindicates the fundamental principle that no
citizen should be held accountable for a violation of a statute
whose commands are uncertain, or subjected to punishment
that is not clearly prescribed. It also places the weight of
inertia upon the party that can best induce Congress to
speak more clearly and keeps courts from making criminal
law in Congress’s stead. Because the “profits” definition of
“proceeds” is always more defendant-friendly than the “re
ceipts” definition, the rule of lenity dictates that it should
be adopted.
III
Stopping short of calling the “profits” interpretation ab
surd, the Government contends that the interpretation
should nonetheless be rejected because it fails to give the
federal money-laundering statute its proper scope and be
cause it hinders effective enforcement of the law. Neither
contention overcomes the rule of lenity.
A
According to the Government, if we do not read “proceeds”
to mean “receipts,” we will disserve the purpose of the fed
eral money-laundering statute, which is, the Government
says, to penalize criminals who conceal or promote their ille
gal activities. On the Government’s view, “[t]he gross re
ceipts of a crime accurately reflect the scale of the criminal
activity, because the illegal activity generated all of the

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funds.” Brief for United States 21; see also post, at 535–537
(Alito, J., dissenting).
When interpreting a criminal statute, we do not play the
part of a mindreader. In our seminal rule-of-lenity decision,
Chief Justice Marshall rejected the impulse to speculate re
garding a dubious congressional intent. “[P]robability is not
a guide which a court, in construing a penal statute, can
safely take.” United States v. Wiltberger, 5 Wheat. 76, 105
(1820). And Justice Frankfurter, writing for the Court in
another case, said the following: “When Congress leaves to
the Judiciary the task of imputing to Congress an undeclared
will, the ambiguity should be resolved in favor of lenity.”
Bell v. United States, 349 U. S. 81, 83 (1955).
The statutory purpose advanced by the Government to
construe “proceeds” is a textbook example of begging the
question. To be sure, if “proceeds” meant “receipts,” one
could say that the statute was aimed at the dangers of con
cealment and promotion. But whether “proceeds” means
“receipts” is the very issue in the case. If “proceeds” means
“profits,” one could say that the statute is aimed at the dis
tinctive danger that arises from leaving in criminal hands
the yield of a crime. A rational Congress could surely have
decided that the risk of leveraging one criminal activity into
the next poses a greater threat to society than the mere pay
ment of crime-related expenses and justifies the money
laundering statute’s harsh penalties.
If we accepted the Government’s invitation to speculate
about congressional purpose, we would also have to confront
and explain the strange consequence of the “receipts” inter
pretation, which respondents have described as a “merger
problem.” See, e. g., Brief for Respondent Diaz 34. If “pro
ceeds” meant “receipts,” nearly every violation of the
illegal-lottery statute would also be a violation of the
money-laundering statute, because paying a winning bettor
is a transaction involving receipts that the defendant intends
to promote the carrying on of the lottery. Since few lotter

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ies, if any, will not pay their winners, the statute criminaliz
ing illegal lotteries, 18 U. S. C. § 1955, would “merge” with
the money-laundering statute. Congress evidently decided
that lottery operators ordinarily deserve up to 5 years of
imprisonment, § 1955(a), but as a result of merger they would
face an additional 20 years, § 1956(a)(1). Prosecutors, of
course, would acquire the discretion to charge the lesser
lottery offense, the greater money-laundering offense, or
both—which would predictably be used to induce a plea bar
gain to the lesser charge.
The merger problem is not limited to lottery operators.
For a host of predicate crimes, merger would depend on the
manner and timing of payment for the expenses associated
with the commission of the crime. Few crimes are entirely
free of cost, and costs are not always paid in advance. Any
one who pays for the costs of a crime with its proceeds—for
example, the felon who uses the stolen money to pay for the
rented getaway car—would violate the money-laundering
statute. And any wealth-acquiring crime with multiple par
ticipants would become money laundering when the initial
recipient of the wealth gives his confederates their shares.4
Generally speaking, any specified unlawful activity, an epi
sode of which includes transactions which are not elements
of the offense and in which a participant passes receipts on
to someone else, would merge with money laundering.
There are more than 250 predicate offenses for the money
laundering statute, see Dept. of Justice, Bureau of Justice
Statistics, M. Motivans, Money Laundering Offenders, 1994–
2001, p. 2 (2003), online at http://www.ojp.usdoj.gov/ bjs/pub/
pdf/mlo01.pdf (as visited May 29, 2008, and available in Clerk
4 The Solicitor General suggests that this is the case even under the
“profits” interpretation. See Reply Brief for United States 16; see also
post, at 545 (Alito, J., dissenting). That is not so, because when the
“loot” comes into the hands of the later distributing felon his confederates’
shares are (as to him) not profits but mere receipts subject to his payment
of expenses.

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of Court’s case file), and many foreseeably entail such trans
actions, see 18 U. S. C. § 1956(c)(7) (2000 ed. and Supp. V)
(establishing as predicate offenses a number of illegal traf
ficking and selling offenses, the expenses of which might be
paid after the illegal transportation or sale).
The Government suggests no explanation for why Con
gress would have wanted a transaction that is a normal part
of a crime it had duly considered and appropriately punished
elsewhere in the Criminal Code to radically increase the sen
tence for that crime. Interpreting “proceeds” to mean
“profits” eliminates the merger problem. Transactions that
normally occur during the course of running a lottery are
not identifiable uses of profits and thus do not violate the
money-laundering statute. More generally, a criminal who
enters into a transaction paying the expenses of his illegal
activity cannot possibly violate the money-laundering stat
ute, because by definition profits consist of what remains
after expenses are paid. Defraying an activity’s costs with
its receipts simply will not be covered.
The principal dissent suggests that a solution to the
merger problem may be found in giving a narrow interpre
tation to the “promotion prong” of the statute: A defendant
might be deemed not to “promote” illegal activity “by doing
those things . . . that are needed merely to keep the business
running,” post, at 547–548, because promotion (presumably)
means doing things that will cause a business to grow. See
Webster’s 2d, at 1981 (giving as one of the meanings of
“promote” “[t]o contribute to the growth [or] enlargement”
of something). (This argument is embraced by Justice
Breyer’s dissent as well. See post, at 530.) The federal
money-laundering statute, however, bars not the bare act of
promotion, but engaging in certain transactions “with the
intent to promote the carrying on of specified unlawful activ
ity.” 18 U. S. C. § 1956(a)(1)(A)(i) (2000 ed.) (emphasis
added). In that context the word naturally bears one of its
other meanings, such as “[t]o contribute to the . . . prosper

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ity” of something, or to “further” something. See Webster’s
2d, at 1981. Surely one promotes “the carrying on” of a
gambling enterprise by merely ensuring that it continues in
business.5 In any event, to believe that this “narrow” inter
pretation of “promote” would solve the merger problem one
must share the dissent’s misperception that the statute ap
plies just to the conduct of ongoing enterprises rather than
individual unlawful acts. If the predicate act is theft by an
individual, it makes no sense to ask whether an expenditure
was intended to “grow” the culprit’s theft business. The
merger problem thus stands as a major obstacle to the dis
sent’s interpretation of “proceeds.”
Justice Breyer admits that the merger problem casts
doubt on the Government’s position, post, at 529, but believes
there are “other, more legally felicitous” solutions to the
problem, post, at 530. He suggests that the merger problem
could be solved by holding that “the money laundering of
fense and the underlying offense that generated the money
to be laundered must be distinct in order to be separately
punishable.” Ibid. The insuperable difficulty with this so
lution is that it has no basis whatever in the words of the
statute. Even assuming (as one should not) the propriety of
a judicial rewrite, why should one believe that Congress
wanted courts to avoid the merger problem in that unusual
fashion, rather than by adopting one of the two possible
meanings of an ambiguous term? Justice Breyer pins
5 We note in passing the peculiarity that a dissent which rejects our
interpretation of “proceeds” because knowledge of profits will be difficult
to prove, suggests an interpretation of “promotes” that will require prov
ing that a particular expenditure was intended, not merely to keep a busi
ness “running,” but to expand it. (“You must decide, ladies and gentle
men of the jury, whether it is true beyond a reasonable doubt that the
payoff of this winning bettor was not simply motivated by a desire to
bring him and other current gambling customers back, but was meant
to create a reputation for reliable payoff that would attract future
customers.”)

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hope on the possibility, “if the ‘merger’ problem is essentially
a problem of fairness in sentencing,” that the United States
Sentencing Commission might revise its recommended sen
tences for money laundering. Ibid. See also principal dis
sent, post, at 547 (in agreement). Even if that is a possibil
ity, it is not a certainty. And once again, why should one
choose this chancy method of solving the problem, rather
than interpret ambiguous language to avoid it? In any
event, as noted, supra, at 515–516, the merger problem af
fects more than just sentencing; it affects charging decisions
and plea bargaining as well.
B
The Government also argues for the “receipts” interpre
tation because—quite frankly—it is easier to prosecute.
Proving the proceeds and knowledge elements of the federal
money-laundering offense under the “profits” interpretation
will unquestionably require proof that is more difficult to
obtain. Essentially, the Government asks us to resolve
the statutory ambiguity in light of Congress’s presumptive
intent to facilitate money-laundering prosecutions. That
position turns the rule of lenity upside down. We interpret
ambiguous criminal statutes in favor of defendants, not
prosecutors.
It is true that the “profits” interpretation demands more
from the Government than the “receipts” interpretation.
Not so much more, however, as to render such a disposition
inconceivable—as proved by the fact that Congress has im
posed similar proof burdens upon the prosecution elsewhere.
See 18 U. S. C. § 1963(a) (criminal forfeiture provision requir
ing determination of “gross profits or other proceeds”); 21
U. S. C. § 853(a) (same).6 It is untrue that the added burdens
6 The principal dissent claims that these statutes do not require proof of
profits because the Government could rely upon the “other proceeds”
prong, which the dissent interprets to mean all proceeds, gross profits and
everything else. See post, at 545. We do not normally interpret a text in

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520 UNITED STATES v. SANTOS
Opinion of Scalia, J.
“serve no discernible purpose.” Post, at 542 (Alito, J., dis
senting). They ensure that the severe money-laundering
penalties will be imposed only for the removal of profits from
criminal activity, which permit the leveraging of one crimi
nal activity into the next. See supra, at 515.
In any event, the Government exaggerates the difficulties.
The “proceeds of specified unlawful activity” are the pro
ceeds from the conduct sufficient to prove one predicate of
fense. Thus, to establish the proceeds element under the
“profits” interpretation, the prosecution needs to show only
that a single instance of specified unlawful activity was
profitable and gave rise to the money involved in a charged
transaction. And the Government, of course, can select the
instances for which the profitability is clearest. Contrary to
the principal dissent’s view, post, at 536, 540–542, the fact
finder will not need to consider gains, expenses, and losses at
tributable to other instances of specified unlawful activity,
which go to the profitability of some entire criminal enterprise.
What counts is whether the receipts from the charged unlaw
ful act exceeded the costs fairly attributable to it.7
a manner that makes one of its provisions superfluous. But even if we
did, these provisions would still establish what the dissent believes un
thinkable: that Congress could envision the Government’s proving profits.
7 The principal dissent asks, “[H]ow long does each gambling ‘instance’
last?” Post, at 543. The answer is “as long as the Government chooses
to charge.” Title 18 U. S. C. § 1955(a) provides that “[w]hoever conducts,
finances, manages, supervises, directs, or owns all or part of an illegal
gambling business shall be fined under this title or imprisoned not more
than five years, or both.” An illegal gambling business is an illegal
gambling business during each moment of its operation, and it will be up
to the Government to select that period of time for which it can most
readily establish the necessary elements of the charged offenses, including
(if money laundering is one of them) profitability. (To the extent this
raises the possibility of the Government’s making multiple violations out
of one person’s running of a single business, that problem arises no matter
what definition of “proceeds” is adopted.) The “preposterous results”
that the dissent attributes to our interpretation of “proceeds,” post, at 544,
are in fact the consequence of the Government’s decision to charge Santos

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Opinion of Scalia, J.
When the Government charges an “enterprise” crime as
the predicate offense, see, e. g., 18 U. S. C. § 1956(c)(7)(C),
it will have to prove the profitability of only the conduct
sufficient to violate the enterprise statute. That is typically
defined as a “continuing series of violations,” 21 U. S. C.
§ 848(c)(2), which would presumably be satisfied by three vio
lations, see Richardson v. United States, 526 U. S. 813, 818
(1999). Thus, the Government will have to prove the
profitability of just three offenses, selecting (again) those for
which profitability is clearest. And of course a prosecutor
will often be able to charge the underlying crimes instead of
the overarching enterprise crime.
As for the knowledge element of the money-laundering of
fense—knowledge that the transaction involves profits of un
lawful activity—that will be provable (as knowledge must
almost always be proved) by circumstantial evidence. For
example, someone accepting receipts from what he knows to
be a long-continuing drug-dealing operation can be found to
know that they include some profits. And a jury could infer
from a long-running launderer-criminal relationship that the
launderer knew he was hiding the criminal’s profits. More
over, the Government will be entitled to a willful blindness
instruction if the professional money launderer, aware of a
high probability that the laundered funds were profits, delib
erately avoids learning the truth about them—as might be
the case when he knows that the underlying crime is one
that is rarely unprofitable.
IV
Concurring in the judgment, Justice Stevens expresses
the view that the rule of lenity applies to this case because
there is no legislative history reflecting any legislator’s belief
with conducting a gambling business over a 6-year period. Of course in
the vast majority of cases, establishing the profitability of the predicate
offense will not put the Government to the task of identifying the relevant
period. Most criminal statutes prohibit discrete, individual acts (fraud,
bank robbery) rather than the conduct of a business.

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Opinion of Scalia, J.
about how the money-laundering statute should apply to lot
tery operators. See post, at 526, 528. The rule of lenity
might not apply, he thinks, in a case involving an organized
crime syndicate or the sale of contraband because the legisla
tive history supposedly contains some views on the meaning
of “proceeds” in those circumstances.8 See post, at 525–526,
and n. 3. In short, Justice Stevens would interpret “pro
ceeds” to mean “profits” for some predicate crimes, “re
ceipts” for others.
Justice Stevens’ position is original with him; neither
the United States nor any amicus suggested it; it has no
precedent in our cases. Justice Stevens relies on the
proposition that one undefined word, repeated in different
statutory provisions, can have different meanings in each
provision. See post, at 525, and n. 2. But that is worlds
apart from giving the same word, in the same statutory provi
sion, different meanings in different factual contexts. Not
only have we never engaged in such interpretive contortion;
just over three years ago, in an opinion joined by Justice
Stevens, we forcefully rejected it. Clark v. Martinez, 543
U. S. 371 (2005), held that the meaning of words in a statute
cannot change with the statute’s application. See id., at 378.
To hold otherwise “would render every statute a chameleon,”
id., at 382, and “would establish within our jurisprudence . . .
the dangerous principle that judges can give the same statu
8 Justice Stevens fails to identify the legislative history to which he
refers. He offers only: “As Justice Alito rightly argues, the legislative
history of § 1956 makes it clear that Congress intended the term ‘proceeds’
to include gross revenues from the sale of contraband and the operation
of organized crime syndicates involving such sales.” Post, at 525–526.
Although Justice Alito, from one item of legislative history, draws an
inference about the meaning of “proceeds” in all its applications (which we
find dubious, see n. 3, supra), nowhere does he cite legislative history
addressing the meaning of the word “proceeds” in cases specifically involv
ing contraband or organized crime. Thus Justice Stevens’ concurrence
appears to address not only a hypothetical case, see infra, at 523, but even
an imagined legislative history.

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Opinion of Scalia, J.
tory text different meanings in different cases,” id., at 386.
Precisely to avoid that result, our cases often “give a stat
ute’s ambiguous language a limiting construction called for
by one of the statute’s applications, even though other of the
statute’s applications, standing alone, would not support the
same limitation. The lowest common denominator, as it
were, must govern.” Id., at 380 (emphasis added).
Our obligation to maintain the consistent meaning of
words in statutory text does not disappear when the rule
of lenity is involved. To the contrary, we have resolved an
ambiguity in a tax statute in favor of the taxpayer in a civil
case because the statute had criminal applications that trig
gered the rule of lenity. See United States v. Thompson/
Center Arms Co., 504 U. S. 505, 517–518, and n. 10 (1992)
(plurality opinion). If anything, the rule of lenity is an addi
tional reason to remain consistent, lest those subject to the
criminal law be misled. And even if, as Justice Stevens
contends, post, at 524, statutory ambiguity “effectively” li
censes us to write a brand-new law, we cannot accept that
power in a criminal case, where the law must be written
by Congress. See United States v. Hudson, 7 Cranch 32,
34 (1812).
We think it appropriate to add a word concerning the stare
decisis effect of Justice Stevens’ opinion. Since his vote
is necessary to our judgment, and since his opinion rests
upon the narrower ground, the Court’s holding is limited ac
cordingly. See Marks v. United States, 430 U. S. 188, 193
(1977). But the narrowness of his ground consists of finding
that “proceeds” means “profits” when there is no legislative
history to the contrary. That is all that our judgment holds.
It does not hold that the outcome is different when contrary
legislative history does exist. Justice Stevens’ specula
tions on that point address a case that is not before him, are
the purest of dicta, and form no part of today’s holding.
Thus, as far as this particular statute is concerned, counsel
remain free to argue Justice Stevens’ view (and to explain

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524 UNITED STATES v. SANTOS
Stevens, J., concurring in judgment
why it does not overrule Clark v. Martinez, supra). They
should be warned, however: Not only do the Justices joining
this opinion reject that view, but so also (apparently) do the
Justices joining the principal dissent. See post, at 532, 546.
V
The money-laundering charges brought against Santos
were based on his payments to the lottery winners and
his employees, and the money-laundering charge brought
against Diaz was based on his receipt of payments as an em
ployee. Neither type of transaction can fairly be character
ized as involving the lottery’s profits. Indeed, the Govern
ment did not try to prove, and respondents have not
admitted, that they laundered criminal profits. We accord
ingly affirm the judgment of the Court of Appeals.
It is so ordered.
Justice Stevens, concurring in the judgment.
When Congress fails to define potentially ambiguous statu
tory terms, it effectively delegates to federal judges the task
of filling gaps in a statute. See Commissioner v. Fink, 483
U. S. 89, 104 (1987) (Stevens, J., dissenting) (“In the process
of legislating it is inevitable that Congress will leave open
spaces in the law that the courts are implicitly authorized to
fill”). Congress has included definitions of the term “pro
ceeds” in some criminal statutes,1 but it has not done so in 18
U. S. C. § 1956 (2000 ed. and Supp. V), the money laundering
statute at issue in this case. That statute is somewhat
unique because it applies to the proceeds of a varied and
lengthy list of specified unlawful activities, see § 1956(c)(7)
(defining “specified unlawful activity” to include, inter alia,
1 For example, 18 U. S. C. § 2339C(e)(3) (2000 ed., Supp. V), which prohib
its the concealment of proceeds derived from funds used to support ter
rorism, defines “proceeds” to mean “any funds derived from or obtained,
directly or indirectly, through the commission of [the] offense.”

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Stevens, J., concurring in judgment
controlled substance violations, murder, bribery, smuggling,
various forms of fraud, concealment of assets, various envi
ronmental offenses, and health care offenses).
Although it did not do so, it seems clear that Congress
could have provided that the term “proceeds” shall have one
meaning when referring to some specified unlawful activities
and a different meaning when referring to others. In fact,
in the general civil forfeiture statute, § 981, Congress did
provide two different definitions of “proceeds,” recognizing
that—for a subset of activities—“proceeds” must allow for
the deduction of costs. Compare § 981(a)(2)(A) (2000 ed.)
(defining “proceeds” in cases involving illegal goods and serv
ices to mean “property of any kind obtained directly or indi
rectly . . . not limited to the net gain or profit realized from
the offense”) with § 981(a)(2)(B) (defining “proceeds” with re
spect to lawful goods sold in an illegal manner as the amount
of money acquired “less the direct costs incurred in provid
ing the goods or services”).
We have previously recognized that the same word can
have different meanings in the same statute.2 If Congress
could have expressly defined the term “proceeds” differently
when applied to different specified unlawful activities, it
seems to me that judges filling the gap in a statute with such
a variety of applications may also do so, as long as they are
conscientiously endeavoring to carry out the intent of Con
gress. Therefore, contrary to what Justice Alito and the
plurality state, see post, at 546 (dissenting opinion); ante, at
522–523 (plurality opinion), this Court need not pick a single
definition of “proceeds” applicable to every unlawful activity,
no matter how incongruous some applications may be.
As Justice Alito rightly argues, the legislative history
of § 1956 makes it clear that Congress intended the term
2 See, e. g., General Dynamics Land Systems, Inc. v. Cline, 540 U. S.
581, 595 (2004) (rejecting the presumption that the term “age” had an
identical meaning throughout the Age Discrimination in Employment Act
of 1967).

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526 UNITED STATES v. SANTOS
Stevens, J., concurring in judgment
“proceeds” to include gross revenues from the sale of contra
band and the operation of organized crime syndicates involv
ing such sales.3 But that history sheds no light on how to
identify the proceeds of many other types of specified unlaw
ful activities. For example, one specified unlawful activity
is the conduct proscribed by § 541, “Entry of goods falsely
classified.” Section 541 provides that “[w]hoever knowingly
effects any entry of goods, wares, or merchandise, at less
than the true weight or measure thereof, or upon a false
classification as to quality or value, or by the payment of less
than the amount of duty legally due, shall be . . . imprisoned
not more than two years.” Conceivably the “proceeds”
stemming from a violation of § 541 could be either the money
realized by misstating the value—that is, the amount by
which the criminal “profits” by paying reduced duties—or
the total price at which the goods are later sold, even though
the misclassification had only a trivial impact on that price.
Just as the legislative history fails to tell us how to calcu
late the “proceeds” of violations of § 541, it is equally silent
on the proceeds of an unlicensed stand-alone gambling ven
ture. The consequences of applying a “gross receipts” defi
nition of “proceeds” to the gambling operation conducted by
respondents are so perverse that I cannot believe they were
contemplated by Congress, particularly given the fact that
nothing in Justice Alito’s thorough review of the legisla
tive history indicates otherwise.4
Constrained by a holding that the payment of expenses
constitutes “promotion,” 5 Justice Alito’s opinion runs
3 Thus, I cannot agree with the plurality that the rule of lenity must
apply to the definition of “proceeds” for these types of unlawful activities.
4 As Justice Alito notes, some reference was made in the legislative
history to gambling as a part of a broader criminal syndicate’s activities.
Post, at 539–540. But that reference does not indicate that Congress in
tended the “proceeds” of a gambling business to include gross receipts.
5 The Seventh Circuit held on a prior appeal that respondent Santos’
actions were legally sufficient to convict him of promoting the carrying on
of a business under § 1956, United States v. Febus, 218 F. 3d 784, 789–790

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Stevens, J., concurring in judgment
squarely into what can be characterized as the “merger”
problem. Allowing the Government to treat the mere pay
ment of the expense of operating an illegal gambling busi
ness as a separate offense is in practical effect tantamount
to double jeopardy, which is particularly unfair in this case
because the penalties for money laundering are substantially
more severe than those for the underlying offense of operat
ing a gambling business. A money laundering conviction in
creases the statutory maximum from 5 to 20 years, and the
Sentencing Commission has prescribed different Guidelines
ranges for the two crimes.6 When a defendant has a sig
nificant criminal history or Guidelines enhancements apply,
the statutory cap of five years in § 1955 is an important limi
tation on a defendant’s sentence—a limitation that would be
eviscerated if Justice Alito’s definition of “proceeds” were
applied in this case.
Justice Alito and Justice Breyer suggest that the ad
visory nature of the Guidelines post-Booker, United States
v. Booker, 543 U. S. 220 (2005), or the possibility of an amend
ment to the money laundering Guideline, would soften this
blow, post, at 547 (opinion of Alito, J.); post, at 530–531 (dis
senting opinion of Breyer, J.), and indeed they could. But
the result in the case at hand might not be softened at all
(2000). Justice Alito criticizes the plurality for allowing the interpreta
tion of “proceeds” to be “dictated by an unreviewed interpretation of an
other statutory element.” See post, at 548. I do not base my opinion on
any disagreement with the interpretation of “promotion.”
6 For example, under the 2007 Guidelines, the base offense level for run
ning a gambling business is 12. United States Sentencing Commission,
Guidelines Manual § 2E3.1 (Nov. 2007) (USSG). Section 2S1.1, which pro
vides the base offense level for money laundering, adds two levels to the
base offense level for the underlying crime where the defendant is con
victed under 18 U. S. C. § 1956. This scheme for determining the base
offense level first appeared in the November 2001 Sentencing Guidelines.
Prior to 2001, the difference between sentences for gambling and money
laundering was even more pronounced, as USSG § 2S1.1 (Nov. 2000) set an
offense level of 23, which could be increased if the value of the funds
exceeded $100,000.

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528 UNITED STATES v. SANTOS
Stevens, J., concurring in judgment
by resort to Booker because respondents’ direct appeal was
decided in 2000, several years prior to our decision in Booker.
If Justice Alito’s opinion were to carry the day, both re
spondents would return to prison to serve the remainder of
their lengthy sentences.
The revenue generated by a gambling business that is used
to pay the essential expenses of operating that business is
not “proceeds” within the meaning of the money laundering
statute. As the plurality notes, there is “no explanation for
why Congress would have wanted a transaction that is a nor
mal part of a crime it had duly considered and appropriately
punished elsewhere in the Criminal Code to radically in
crease the sentence for that crime.” Ante, at 517. This
conclusion dovetails with what common sense and the rule of
lenity would require. Faced with both a lack of legislative
history speaking to the definition of “proceeds” when operat
ing a gambling business is the “specified unlawful activity”
and my conviction that Congress could not have intended the
perverse result that would obtain in this case under Justice
Alito’s opinion, the rule of lenity may weigh in the determi
nation. And in that respect the plurality’s opinion is surely
persuasive.7 Accordingly, I concur in the judgment.
7 In what can only be characterized as the “purest of dicta,” the plurality
speculates about the stare decisis effect of our judgment and interprets
my conclusion as resting on the ground that “ ‘proceeds’ means ‘profits’
when there is no legislative history to the contrary.” Ante, at 523. That
is not correct; my conclusion rests on my conviction that Congress could
not have intended the perverse result that the dissent’s rule would
produce if its definition of “proceeds” were applied to the operation of an
unlicensed gambling business. In other applications of the statute not
involving such a perverse result, I would presume that the legislative his
tory summarized by Justice Alito reflects the intent of the enacting
Congress. See post, at 531–532, and n. 1. Its decision to leave the term
undefined is consistent with my view that “proceeds” need not be given
the same definition when applied to each of the numerous specified unlaw
ful activities that produce unclean money. Clark v. Martinez, 543 U. S.
371 (2005), poses no barrier to this conclusion. In Martinez there was no

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Breyer, J., dissenting
Justice Breyer, dissenting.
I join Justice Alito’s dissent while adding the follow
ing observations about what has been referred to as the
“ ‘merger problem.’ ” Ante, at 515 (plurality opinion). Like
the plurality, I doubt that Congress intended the money
laundering statute automatically to cover financial transac
tions that constitute an essential part of a different underly
ing crime. Operating an illegal gambling business, for ex
ample, inevitably involves investment in overhead as well as
payments to employees and winning customers; a drug
offense normally involves payment for drugs; and bank rob
bery may well require the distribution of stolen cash to con
federates. If the money laundering statute applies to this
kind of transaction (i. e., if the transaction is automatically a
“financial transaction” that “involves the proceeds of speci
fied unlawful activity” made “with the intent to promote the
carrying on of specified unlawful activity”), then the Govern
ment can seek a heavier money laundering penalty (say, 20
years), even though the only conduct at issue is conduct that
warranted a lighter penalty (say, 5 years for illegal gam
bling). 18 U. S. C. § 1956(a)(1).
It is difficult to understand why Congress would have
intended the Government to possess this punishment
transforming power. Perhaps for this reason, the Tenth
Circuit has written that “Congress aimed the crime of money
laundering at conduct that follows in time the underlying
crime rather than to afford an alternative means of punishing
the prior ‘specified unlawful activity.’ ” United States v.
Edgmon, 952 F. 2d 1206, 1214 (1991). And, in 1997, the
United States Sentencing Commission told Congress that it
agreed with the Department of Justice that “money launder
ing cannot properly be charged for ‘merged’ transactions
that are part of the underlying crime.” Report to Congress:
compelling reason—in stark contrast to the situation here—to believe that
Congress intended the result for which the Government argued.

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530 UNITED STATES v. SANTOS
Breyer, J., dissenting
Sentencing Policy for Money Laundering Offenses, including
Comments on Dept. of Justice Report, p. 16 (Sept. 1997), on
line at http://www.ussc.gov/r_congress/launder.pdf (as visited
May 20, 2008, and available in Clerk of Court’s case file).
Thus, like the plurality, I see a “merger” problem. But,
unlike the plurality, I do not believe that we should look to
the word “proceeds” for a solution. For one thing, the plu
rality’s interpretation of that word creates the serious logical
and practical difficulties that Justice Alito describes. See
post, at 537–542 (dissenting opinion) (describing difficulties
associated with proof and accounting). For another thing,
there are other, more legally felicitous places to look for a
solution. The Tenth Circuit, for example, has simply held
that the money laundering offense and the underlying of
fense that generated the money to be laundered must be dis
tinct in order to be separately punishable. Edgmon, supra,
at 1214. Alternatively the money laundering statute’s
phrase “with the intent to promote the carrying on of speci
fied unlawful activity” may not apply where, for example,
only one instance of that underlying activity is at issue.
(The Seventh Circuit on a prior appeal in this case rejected
that argument, and thus we do not consider it here. See
United States v. Febus, 218 F. 3d 784, 789 (2000).)
Finally, if the “merger” problem is essentially a problem
of fairness in sentencing, the Sentencing Commission has ad
equate authority to address it. Congress has instructed the
Commission to “avoi[d] unwarranted sentencing disparities”
among those “found guilty of similar criminal conduct.” 28
U. S. C. § 991(b)(1)(B) (emphasis added); see also § 994(f) (in
structing the Commission to pay particular attention to
those disparities). The current money laundering Guideline,
United States Sentencing Commission, Guidelines Manual
§ 2S1.1 (Nov. 2007), by making no exception for a situation
where nothing but a single instance of the underlying crime
has taken place, would seem to create a serious and unwar
ranted disparity among defendants who have engaged in

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531 Cite as: 553 U. S. 507 (2008)
Alito, J., dissenting
identical conduct. My hope is that the Commission’s past
efforts to tie more closely the offense level for money laun
dering to the offense level of the underlying crime, see id.,
Supp. to App. C, Amdt. 634 (Nov. 2001), suggest a willingness
to consider directly this kind of disparity. Such an approach
could solve the “merger” problem without resort to creat
ing complex interpretations of the statute’s language. And
any such solution could be applied retroactively. See 28
U. S. C. § 994(u).
In light of these alternative possibilities, I dissent.
Justice Alito, with whom The Chief Justice, Justice
Kennedy, and Justice Breyer join, dissenting.
Fairly read, the term “proceeds,” as used in the principal
federal money laundering statute, 18 U. S. C. § 1956(a),
means “the total amount brought in,” the primary dictionary
definition. Webster’s Third New International Dictionary
1807 (1976) (hereinafter Webster’s 3d). See also Random
House Dictionary of the English Language 1542 (2d ed. 1987)
(“the total amount derived from a sale or other transaction”).
The plurality opinion, however, makes no serious effort to
interpret this important statutory term. Ignoring the con
text in which the term is used, the problems that the money
laundering statute was enacted to address, and the obvious
practical considerations that those responsible for drafting
the statute almost certainly had in mind, that opinion is
quick to pronounce the term hopelessly ambiguous and thus
to invoke the rule of lenity. Concluding that “proceeds”
means “profits,” the plurality opinion’s interpretation would
frustrate Congress’ intent and maim a statute that was
enacted as an important defense against organized criminal
enterprises.
Fortunately, Justice Stevens’ opinion recognizes that
the term “proceeds” “include[s] gross revenues from the sale
of contraband and the operation of organized crime syndi
cates involving such sales.” Ante, at 526 (opinion concur

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532 UNITED STATES v. SANTOS
Alito, J., dissenting
ring in judgment).1 I cannot agree with Justice Stevens’
approach insofar as it holds that the meaning of the term
“proceeds” varies depending on the nature of the illegal ac
tivity that produces the laundered funds, but at least that
approach preserves the correct interpretation of the statute
in most of the cases that were the focus of congressional
concern when the money laundering statute was enacted.
I
A
While the primary definition of the term “proceeds” is “the
total amount brought in,” I recognize that the term may also
be used to mean “net profit,” Webster’s 3d 1807, and I do
not suggest that the question presented in this case can be
answered simply by opening a dictionary. When a word has
more than one meaning, the meaning that is intended is often
made clear by the context in which the word is used, and
thus in this case, upon finding that the term “proceeds” may
mean both “the total amount brought in” and “net profit,”
the appropriate next step is not to abandon any effort at
interpretation and summon in the rule of lenity. Rather, the
next thing to do is to ask what the term “proceeds” custom
arily means in the context that is relevant here—a money
laundering statute.
The federal money laundering statute is not the only
money laundering provision that uses the term “proceeds.”
On the contrary, the term is a staple of money laundering
laws, and it is instructive that in every single one of these
provisions in which the term “proceeds” is defined—and
there are many—the law specifies that “proceeds” means
“the total amount brought in.”
1 In light of the plurality opinion’s discussion of “the stare decisis effect
of Justice Stevens’ opinion,” ante, at 523, it must be noted that five
Justices agree with the position taken by Justice Stevens on the matter
discussed in the preceding sentence of the text.

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Alito, J., dissenting
The leading treaty on international money laundering, the
United Nations Convention Against Transnational Orga
nized Crime (Convention), Nov. 15, 2000, 2225 U. N. T. S. 209
(Treaty No. I–39574), which has been adopted by the United
States and 146 other countries,2 is instructive. This treaty
contains a provision that is very similar to § 1956(a)(1)(B)(i).
Article 6.1 of the Convention obligates signatory nations to
criminalize “[t]he . . . transfer of property, knowing that such
property is the proceeds of crime, for the purpose of conceal
ing or disguising the illicit origin of the property or of help
ing any person who is involved in the commission of the pred
icate offence to evade the legal consequences of his or her
action.” Id., at 277 (emphasis added). The Convention de
fines the term “proceeds” to mean “any property derived
from or obtained, directly or indirectly, through the com
mission of an offence.” Id., at 275 (Art. 2(e)). The money
laundering provision of the Convention thus covers gross
receipts.3 The term “proceeds” is given a similarly broad
scope in the Model Money Laundering Act (Model Act). See
President’s Commission on Model State Drug Laws, Eco
nomic Remedies § C (1993). Section 5(a)(1) of the Model Act
criminalizes transactions involving property that is “the pro
ceeds of some form of unlawful activity,” and the Model Act
defines “proceeds” as “property acquired or derived directly
2 See Multilateral Treaties Deposited With the Secretary-General, pt. I,
ch. XVIII, No. 12, United Nations Convention Against Transnational
Crime (Nov. 15, 2000), online at http://untreaty.un.org/ENGLISH/ bible/
englishinternetbible/partI/chapterXVIII/treaty13.asp (all Internet mate
rials as visited May 29, 2008, and available in Clerk of Court’s case file).
3 If 18 U. S. C. § 1956 were limited to profits, it would be narrower than
the obligation that the United States undertook in Article 6.1 of the Con
vention, but the Department of State has taken the position that no new
legislation is needed to bring the United States into compliance. See
Hearing on Law Enforcement Treaties before the Senate Committee on
Foreign Relations, 108th Cong., 2d Sess., 10 (2004) (statement of Samuel
M. Witten, Deputy Legal Adviser) (“[W]e can comply with the Conven
tion’s criminalization obligations without need for new legislation”).

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534 UNITED STATES v. SANTOS
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or indirectly from, produced through, realized through, or
caused by an act or omission . . . includ[ing] any property of
any kind,” § 4(a).
Fourteen States have money laundering statutes that de
fine the term “proceeds,” and in every one of these laws the
term is defined in a way that encompasses gross receipts.
See Ariz. Rev. Stat. Ann. §§ 13–2314(N)(3) (West 2001), 13–
2317(F)(4)(b) (West Supp. 2007); Ark. Code Ann. § 5–42–
203(5) (2006); Cal. Health & Safety Code Ann. § 11370.9(h)(1)
(West 2007); Haw. Rev. Stat. §§ 708A–2, 708A–3 (2006 Supp.);
Ind. Code §§ 35–45–15–4, 35–45–15–5 (West 2004); Iowa
Code §§ 706B.1(1), 706B.2 (2005); La. Stat. Ann. § 14:230(A)(4)
(West 2004); Mich. Comp. Laws Ann. §§ 750.411j(f), 750.411k
(West 2004); N. M. Stat. Ann. §§ 30–51–2(E), 30–51–4(A)
(2004); Ohio Rev. Code Ann. §§ 1315.51(H), 1315.55 (Lexis
2006); Tex. Penal Code Ann. §§ 34.01(4), 34.02 (West Supp.
2007); Utah Code Ann. §§ 76–10–1902(9), 76–10–1903 (Lexis
2007); Va. Code Ann. §§ 18.2–246.2, 18.2–246.3 (Lexis 2004);
Wash. Rev. Code §§ 9A.83.010(5), 9A.83.020 (2006). Cf. N. J.
Stat. Ann. § 2C:21–25(d) (West 2005).4
This pattern of usage is revealing. It strongly suggests
that when lawmakers, knowledgeable about the nature and
problem of money laundering, use the term “proceeds” in a
4 Connecticut, the only State with a money laundering statute that does
not use the term “proceeds,” uses equivalent language that is not limited
to profits. See Conn. Gen. Stat. § 53a–276 (2005) (“A person is guilty of
money laundering in the first degree when he exchanges . . . one or more
monetary instruments derived from criminal conduct constituting a fel
ony”). I have found no money laundering statute that defines “proceeds”
to mean profits or that uses other language that limits the law’s reach to
profits or net income.
The only state money laundering statute that even uses the term
“profits,” “net income,” or something similar is that of Arkansas, which
plainly defines “criminal proceeds” to include all gross receipts of criminal
conduct: “ ‘Criminal proceeds’ means: (A) Anything of value furnished or
intended to be furnished in exchange for criminal conduct or contraband
received in violation of state or federal law; and (B) Property or profits
traceable to” such an exchange. Ark. Code Ann. § 5–42–203(5).

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money laundering provision, they customarily mean for the
term to reach all receipts and not just profits.5
B
There is a very good reason for this uniform pattern of
usage. Money laundering provisions serve two chief ends.
First, they provide deterrence by preventing drug traffick
ers and other criminals who amass large quantities of cash
from using these funds “to support a luxurious lifestyle” or
otherwise to enjoy the fruits of their crimes. Model Act,
Policy Statement, at C–105. See President’s Commission on
Organized Crime, Interim Report to President and Attorney
General, The Cash Connection: Organized Crime, Financial
Institutions, and Money Laundering 7–8 (Oct. 1984) (herein
after Interim Report); Aranson, Bouker, & Hannan, Money
Laundering, 31 Am. Crim. L. Rev. 721, 722 (1994); H. R. Rep.
No. 99–746, p. 16 (1986) (hereinafter H. R. Rep.). Second,
they inhibit the growth of criminal enterprises by preventing
5 The version of the money laundering statute originally passed by the
House reflected a similar legislative judgment. The bill made it a crime
to engage in financial transactions and certain commercial transactions
involving “criminally derived property that is derived from a designated
offense.” H. R. 5484, 99th Cong., 2d Sess., § 602, p. 154 (1986) (as intro
duced). The term “criminally derived property” is naturally understood
to include all property that is “receive[d]” or “obtain[ed]” as a result of
criminal activity, see Webster’s 3d 608; Random House Dictionary of the
English Language 389 (1967), and thus to include all gross receipts and
not just profit. The House bill defined the term “criminally derived prop
erty” to mean “any property constituting, or derived from, proceeds ob
tained from a criminal offense.” H. R. 5484, § 602, at 158 (emphasis
added). Accordingly, the House seems to have understood “proceeds” to
include gross receipts.
The bill passed by the Senate, like the current money laundering stat
ute, simply used the term “proceeds,” S. 2683, 99th Cong., 2d Sess., § 2(a)
(1986), and the House acceded to the Senate version. See H. R. 5484, 99th
Cong., 2d Sess., § 1352, p. 48 (1986) (as enacted). There is no suggestion
in the legislative history that the term “criminally derived property” and
the term “proceeds” were perceived as having different meanings.

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536 UNITED STATES v. SANTOS
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the use of dirty money to promote the enterprise’s growth.
See, e. g., 18 U. S. C. §§ 1956(a)(1)(A)(i), (a)(2)(A), and
(a)(3)(A); Model Act §§ 5(a)(2), (4); N. J. Stat. Ann. § 2C:21–
25(b)(1); Tex. Penal Code Ann. §§ 34.02(a)(3)–(4).
Both of these objectives are frustrated if a money launder
ing statute is limited to profits. Dirty money may be used
to support “a luxurious lifestyle” and to grow an illegal en
terprise whenever the enterprise possesses large amounts
of illegally obtained cash. And illegal enterprises may ac
quire such cash while engaging in unlawful activity that
is unprofitable.
Suppose, for example, that a drug cartel sends a large
shipment of drugs to this country, a good part of the ship
ment is intercepted, the remainder is sold, the cartel ends up
with a net loss but with a large quantity of cash on its hands,
and the cartel uses the cash in financial transactions that are
designed to conceal the source of the cash or to promote fur
ther crime. There is no plausible reason why Congress
would not have wanted the money laundering statute to
apply to these financial transactions. If the cartel leaders
use the money to live in luxury, this provides an incentive
for these individuals to stay in the business and for others
to enter. If the cartel uses the money to finance future
drug shipments or to expand the business, public safety is
harmed.
It is certainly true that Congress, in enacting the federal
money laundering statute, was primarily concerned about
criminal enterprises that realize profits. A criminal opera
tion that consistently loses money will not last very long and
thus presents a lesser danger than a profitable operation.
But narrowing a money laundering statute so that it reaches
only profits produces two perverse results that Congress
cannot have wanted. First, it immunizes successful criminal
enterprises during those periods when they are operating
temporarily in the red. Second, and more important, it in
troduces pointless and difficult problems of proof. Because

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Alito, J., dissenting
the dangers presented by money laundering are present
whenever criminals have large stores of illegally derived
funds on their hands, there is little reason to require proof—
which may be harder to assemble than the plurality opinion
acknowledges—that the funds represent profits.
C
The implausibility of a net income interpretation is
highlighted in cases involving professionals and others
who are hired to launder money. Those who are knowledge
able about money laundering stress the importance of
prosecuting these hired money launderers. See, e. g., Depts.
of Treasury and Justice, The 2001 National Money Laun
dering Strategy, pp. ix–x, 1–2 (Sept. 2001), online at
http://www.treas.gov/press/releases/docs/ml2001.pdf; Finan
cial Action Task Force on Money Laundering, 1996–1997 Re
port on Money Laundering Typologies 7 (Feb. 1997), online
at http://www.fatf-gafi.org/dataoecd/31/29/34043795.pdf; But
terworths International Guide to Money Laundering Law
and Practice 629 (T. Graham 2d ed. 2003); Ratliff, Third-
Party Money Laundering: Problems of Proof and Prosecuto
rial Discretion, 7 Stan. L. & Pol’y Rev. 173 (1996); Sultzer,
Money Laundering: The Scope of the Problem and Attempts
to Combat It, 63 Tenn. L. Rev. 143, 147–148 (1995); H. R.
Rep., at 16–17.
A net income interpretation would risk hamstringing such
prosecutions. To violate 18 U. S. C. § 1956(a)(1), a defendant
must “kno[w] that the property involved in a financial trans
action represents the proceeds of some form of unlawful ac
tivity.” A professional money launderer is not likely to
know (or perhaps even to care) whether the enterprise is
operating in the black when the funds in question were ac
quired. Therefore, under a net income interpretation, fi
nancial specialists and others who are hired to launder funds
would generally be beyond the reach of the statute, some
thing that Congress almost certainly did not intend.

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538 UNITED STATES v. SANTOS
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It is revealing that the money laundering statute explicitly
provides that a money launderer need only know that “the
property involved in the transaction represented proceeds
from some form, though not necessarily which form, of [spec
ified illegal] activity.” § 1956(c)(1). Thus, the prosecution is
not required to prove that a hired money launderer knew
that funds provided for laundering derived from, say, drug
sales as opposed to gambling. There is no reason to think
that hired money launderers are more likely to know
whether funds include profits than they are to know the na
ture of the illegal activity from which the funds were de
rived. Consequently, § 1956(c) suggests that Congress did
not intend to require proof that a hired money launderer
knew that funds provided for laundering included profits.
The plurality opinion dismisses these concerns with the
observation that a jury may infer that a hired launderer
knew that funds included profits if the launderer had a long
running relationship with the entity or person providing the
funds or knew that the entity or person had been involved
in the illegal enterprise for a lengthy period. See ante,
at 521. But what about the case where the launderer ac
cepts a million dollars of drug money on a single occasion?
And even if there would be legally sufficient evidence to sup
port an inference of the requisite knowledge under the cir
cumstances that the plurality opinion posits, the requirement
of convincing a jury to find beyond a reasonable doubt that
the funds included profits would pose a troublesome and (in
light of the aim of the money laundering statute) pointless
obstacle.
D
Even in cases in which the defendants are alleged to have
been involved in the underlying criminal activity, a net in
come interpretation would produce nettlesome problems that
Congress cannot have wanted. These problems may be es
pecially acute in the very cases that money laundering stat
utes principally target, that is, cases involving large-scale

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Alito, J., dissenting
criminal operations that continue over a substantial period
of time, particularly drug cartels and other organized crime
syndicates.
The federal money laundering statute was enacted in the
wake of an influential report by the President’s Commission
on Organized Crime that focused squarely on criminal enter
prises of this type. See Interim Report 7–8 (described in
S. Rep. No. 99–433, pp. 2–4 (1986) (hereinafter S. Rep.) and
H. R. Rep., at 16). The Commission identified drug traf
fickers and other organized criminal groups as presenting
the most serious problems. See Interim Report 7. The
Commission found that “narcotics traffickers, who must con
ceal billions of dollars in cash from detection by the govern
ment, create by far the greatest demand for money launder
ing schemes” but that “numerous other types of activities
typical of organized crime, such as loansharking and gam
bling, also create an appreciable demand for such schemes.”
Ibid. To illustrate the scope and nature of the money laun
dering problem, a section of the Interim Report was devoted
to case studies, most of which involved the laundering of
drug money. Id., at 29–49.
As a prime example of the problem of money laundering,
the report discussed the so-called “Pizza Connection” case
that was prosecuted in federal court in New York City in the
1980’s. In that case, the evidence showed that the Sicilian
Mafia and organized crime elements in the United States,
over a period of many years, imported huge amounts of her
oin into this country, sold the heroin here, accumulated mil
lions of dollars of cash, and then laundered the funds by
smuggling them overseas in suitcases or funneling the money
through a maze of bank accounts. See id., at 31–35; United
States v. Casamento, 887 F. 2d 1141, 1148–1149 (CA2 1989).
Following the issuance of the Interim Report, Congress
turned its attention to the problem of money laundering, and
much of the discussion focused on the need to prevent laun
dering by drug and organized crime syndicates. See, e. g.,

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540 UNITED STATES v. SANTOS
Alito, J., dissenting
S. Rep., at 3 (discussing “organized crime ‘businesses’ such
as gambling, prostitution, and loansharking”), 4 (“Money
laundering is a crucial financial underpinning of organized
crime and narcotics trafficking” (internal quotation marks
omitted)); Hearing on Money Laundering Legislation before
the Senate Committee on the Judiciary, 99th Cong., 1st Sess.,
1 (1985) (statement of Chairman Thurmond), 29 (statement
of Sen. Biden), 30 (statement of Sen. DeConcini), 31 (state
ment of Sen. D’Amato), 53 (statement of Assistant Attorney
General Trott).
In light of these concerns, it is most unlikely that Congress
meant to enact a money laundering statute that would pre
sent daunting obstacles in the very sort of cases that had
been identified as presenting the most pressing problems,
that is, cases, like the “Pizza Connection” case, in which law
enforcement intercepts cash or wire transfers of funds de
rived from drug sales or other unlawful activity that oc
curred over a period of time. The plurality opinion’s inter
pretation of the term “proceeds,” however, would often
produce such problems. Tracing funds back to particular
drug sales and proving that these sales were profitable will
often prove impossible. See United States v. Bajakajian,
524 U. S. 321, 351–352 (1998) (Kennedy, J., dissenting). In
deed, it will often be hard even to establish with any preci
sion the period of time during which the drug sales occurred.
But assuming that the Government can prove roughly when
the funds were acquired, the next hurdle would be to show
that the drug ring had net income during the time when the
funds were acquired.
“Net income” means “[t]he excess of revenues over all re
lated expenses for a given period.” R. Estes, Dictionary of
Accounting 88 (1981) (emphasis deleted). There are no gen
erally accepted accounting principles for determining the net
income of illegal enterprises, and therefore, in order to apply
a net income interpretation, special accounting rules would
have to be developed.

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541 Cite as: 553 U. S. 507 (2008)
Alito, J., dissenting
In the drug-money cases that I have been discussing, the
courts would have to decide whether the drug syndicate’s
net income should be calculated on an annual, quarterly, or
some other basis. In addition, the courts would be forced
to devise rules for determining the scope of the enterprise
for which the net income calculation must be performed.
Suppose, for example, that there were connections of an un
certain nature or degree between drug operations in differ
ent cities or countries. Rules would be needed to determine
whether affiliated criminal groups should be regarded as one
enterprise or several. And proof regarding the connections
between such operations would often be very difficult to ob
tain. Criminal enterprises do not have papers of incorpora
tion, partnership agreements, or (in most instances) other
documents establishing precise business relationships.
Rules would also be needed in order to determine whether
particular illegal expenditures should be considered as ex
penses. In the “Pizza Connection” case, the Sicilian Mafia
used its income for such things as the murder of magistrates,
police officers, witnesses, and rivals. See, e. g., Casamento,
supra, at 1154–1156; United States v. Gambino, 809 F. Supp.
1061, 1065–1068 (SDNY 1992). Are these expenditures sim
ply a cost of engaging in the drug trade? Are they busi
ness expenses?
If a net income interpretation were taken to its logical
conclusion, it presumably would be necessary as well to work
out rules for the depreciation of instrumentalities of crime
that must occasionally be replaced due to the efforts of law
enforcement. But it seems quite implausible that Congress
wanted courts or juries in money laundering cases to grapple
with questions such as the useful life of, say, a drug process
ing plant or laboratory or the airplanes and boats that are
used to smuggle drugs. And assuming that the accounting
issues can ultimately be resolved by the courts, there would
remain serious problems of proof. Illegal enterprises gener

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542 UNITED STATES v. SANTOS
Alito, J., dissenting
ally do not keep books and records like legitimate busi
nesses do.
It is tempting to dismiss many of the problems noted
above on the ground that “everyone knows” that drug car
tels, organized crime syndicates, and the like make a profit.
But such groups may not operate in the black at all times,
and in any event, if net income is an element of the money
laundering offense, the prosecution must prove net income
beyond a reasonable doubt. The prosecution cannot simply
ask the jury to take notice of the fact that these groups are
profitable.
My point in citing the accounting and proof problems that
would be produced by a net income interpretation is not that
the “ ‘receipts’ ” interpretation is preferable because “it is
easier to prosecute,” ante, at 519 (plurality opinion), but that
creating these obstacles would serve no discernible purpose.
Even if a drug or gambling ring was temporarily operating
in the red during a particular period, the laundering of
money acquired during that time would present the same
dangers as the laundering of money acquired during times
of profit. It is therefore implausible that Congress wanted
to throw up such pointless obstacles.
The plurality opinion attempts to minimize all these prob
lems by stating that “to establish the proceeds element
under the ‘profits’ interpretation, the prosecution needs to
show only that a single instance of specified unlawful activity
was profitable and gave rise to the money involved in a
charged transaction.” Ante, at 520. This suggestion ig
nores both the language of the money laundering statute,
which makes no reference to an “instance” of unlawful activ
ity, and the realities of money laundering prosecutions. The
prototypical money laundering case is not a case in which a
defendant engages in a single, discrete criminal act and then
launders the money derived from that act—for example, a
case in which a “felon . . . uses . . . stolen money to pay for
the rented getaway car.” Ante, at 516. Rather, the proto

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typical case involves numerous criminal acts that occur over
a period of time and the accumulation of funds from all these
acts prior to laundering—for example, the organized crime
syndicate or drug cartel that amasses large sums before en
gaging in a laundering transaction.
Take, for example, a case in which a defendant is charged
with doing what was done in the “Pizza Connection” case—
transferring millions of dollars of drug money overseas,
knowing that the funds represent the proceeds of drug traf
ficking (“some form of unlawful activity”) and that the trans
fer was designed to conceal the origin of the funds. See 18
U. S. C. § 1956(a)(2)(B). In such a case, it is unrealistic to
think that individual dollars can be traced back to individual
drug sales—or that Congress wanted to require such tracing.
Although the plurality opinion begins by touting the “sin
gle instance” theory as a cure for the accounting and proof
problems that a “profits” interpretation produces, the plural
ity’s application of the “single instance” theory to the case at
hand shows that this theory will not work. In this case, the
“unlawful activity” that produced the funds at issue in the
substantive money laundering counts was the operation of
the Santos lottery,6 and it is hardly apparent what consti
tutes a “single instance” of running a gambling business.
Did each lottery drawing represent a separate “instance”?
Each wager? And how long does each gambling “instance”
last? A day? A week? A month?
When the plurality opinion addresses these questions, it
turns out that “a single instance” means all instances that
are charged, i. e., it means that the Government had to show
that receipts exceeded costs during the time the defendant
allegedly conducted, financed, etc., the gambling operation.
See ante, at 520–521, n. 7. Here, since the Indictment al
leged that the Santos lottery continued for more than 6 years
(“[b]eginning in or about January 1989 and continuing to in
6 See Indictment in United States v. Almeda, No. 2:96 CR–044 RL (ND
Ind., May 10, 1996), pp. 3, 14–15 (hereinafter Indictment).

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544 UNITED STATES v. SANTOS
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or about December 1994, the exact dates being unknown to
the Grand Jury”),7 the plurality would apparently compel the
Government to prove that the lottery was profitable over
this entire period.
If this is where the “single instance” theory leads, the
theory plainly does not solve the accounting and proof prob
lems we have noted. And the plurality’s suggestion that the
Government had to show that the gambling operation was
profitable for this entire period leads to preposterous results.
Suppose that the lottery was profitable for the first five years
and, at the end of each year, respondents laundered funds
derived from the business. Suppose that in the sixth year
the business incurred heavy losses—losses so heavy that
they wiped out all of the profits from the first five years.
According to the plurality, if respondents were found to have
operated the lottery during the entire 6-year period, then
the financial transactions that occurred at the end of years
one, two, three, four, and five would not violate the money
laundering statute, even though an accounting done at those
times would have come to the conclusion that the funds in
cluded profits. That result makes no sense.
Whenever a money laundering indictment charges that the
laundered funds derived from an “unlawful activity” that
comprehends numerous acts that occurred over a consider
able period of time—and that is precisely the situation in
many of the types of cases that the money laundering statute
principally targeted—the plurality opinion’s interpretation
will produce difficulties. I have already discussed drug and
gambling cases, and similar problems will arise in cases in
which the unlawful activity is a form of fraud. For example,
the unlawful activity in mail fraud (18 U. S. C. § 1341) is the
scheme to defraud, not the individual mailings carried out in
furtherance of the scheme. See Neder v. United States, 527
U. S. 1, 19 (1999); United States v. Mankarious, 151 F. 3d 694
7 See id., at 3.

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Alito, J., dissenting
(CA7 1998). In such a case, what will constitute the “single
instance of unlawful activity”? Will each mailing be a sepa
rate “instance”? The same problem arises with other fraud
predicates, including wire fraud (§ 1343), see, e. g., United
States v. Zvi, 168 F. 3d 49 (CA2 1999), and financial institu
tion fraud (§ 1344), see, e. g., United States v. Farr, 69 F. 3d
545, 1995 WL 638249 (CA9 1995) (unpublished).
The plurality opinion suggests that the application of a
profits interpretation will be easy in cases in which the fi
nancial transactions are payments of “expenses.” Ante,
at 516–517. But it may be no small matter to determine
whether particular payments are for “expenses.” When the
manager of a gambling operation distributes cash to those
who work in the operation, the manager may be paying them
the rough equivalent of a salary; that is, the recipients may
expect to receive a certain amount for their services whether
or not the operation is profitable. On the other hand, those
who work in the operation may have the expectation of re
ceiving a certain percentage of the gross revenue (perhaps
even in addition to a salary), in which case their distribution
may include profits. Such was the case in Santos’ lottery,
where the runners were paid a percentage of gross revenue.
See Indictment 5; 16 Tr. 1399 (Oct. 9, 1997).
The plurality opinion cites 18 U. S. C. § 1963(a) and 21
U. S. C. § 853(a) for the proposition that Congress has “else
where” imposed the burden of proving that illegally obtained
funds represent profits, but the plurality opinion’s examples
are inapposite. Ante, at 519–520. Neither of these provi
sions, however, requires a determination of net income. Both
provisions permit a fine in the amount of “not more than
twice the gross profits or other proceeds.” 18 U. S. C.
§ 1963(a). Thus, the term “proceeds” as used in these provi
sions is not limited to profits.8
8 In 18 U. S. C. § 981(a)(2)(B), which is a forfeiture provision of limited
scope, Congress defines the term “proceeds” to mean net income. How
ever, that definition applies only “[i]n cases involving lawful goods or law

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546 UNITED STATES v. SANTOS
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For all these reasons, I am convinced that the term “pro
ceeds” in the money laundering statute means gross receipts,
not net income. And contrary to the approach taken by
Justice Stevens, I do not see how the meaning of the term
“proceeds” can vary depending on the nature of the illegal
activity that produced the laundered funds.
II
A
It is apparent that a chief reason for interpreting the term
“proceeds” to mean net income in all money laundering cases
(the approach taken in the plurality opinion) or in some
money laundering cases (the approach taken by Justice
Stevens) is the desire to avoid a “merger” problem in gam
bling cases—that is, to avoid an interpretation that would
mean that every violation of § 1955 (conducting an illegal
gambling business) would also constitute a violation of the
money laundering statute, which carries a much higher maxi
mum penalty (20 as opposed to 5 years’ imprisonment).
This concern is misplaced and provides no justification for
hobbling a statute that applies to more than 250 predicate
offenses and not just running an illegal gambling business.
ful services that are sold or provided in an illegal manner.” Calculating
net income in that situation is easier than it would be in most money
laundering cases, and it is noteworthy that Congress took care to provide
rules and procedures to be used in making the calculation. See ibid. If
Congress had intended to require proof of net income in money laundering
cases, it is likely that Congress likewise would have specified the rules
and procedures to be used. It is noteworthy that subparagraph (A) of
§ 981(a)(2), which the plurality opinion does not mention, provides that in
cases that are more analogous to the typical money laundering case, i. e.,
“cases involving illegal goods [or] illegal services,” the term “proceeds”
“means [any] property of any kind obtained directly or indirectly, as the
result of the commission of the offense giving rise to forfeiture, and any
property traceable thereto, and is not limited to the net gain or profit
realized from the offense.”

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First, the so-called merger problem is fundamentally a
sentencing problem, and the proper remedy is a sentencing
remedy. While it is true that the money laundering statute
has a higher maximum sentence than the gambling business
statute, neither statute has a mandatory minimum. Thus,
these statutes do not require a judge to increase a defend
ant’s sentence simply because the defendant was convicted
of money laundering as well as running a gambling business.
When the respondents were convicted, their money launder
ing convictions resulted in higher sentences only because of
the money laundering Sentencing Guideline, United States
Sentencing Commission, Guidelines Manual § 2S1.1 (Nov.
1997) (USSG), which, in the pre-Booker 9 era, was mandatory.
I agree with Justice Breyer, ante, at 530–531 (dissenting
opinion), that if a defendant is convicted of money laundering
for doing no more than is required for a violation of 18
U. S. C. § 1955, the defendant’s sentence should be no higher
than it would have been if the defendant had violated only
that latter provision. Insofar as the Guidelines previously
required—and now advise in favor of—a stiffer sentence, the
obvious remedy is an amendment of the money laundering
Guideline. And of course, now that the Guidelines are no
longer mandatory, a sentencing judge could impose the sen
tence called for by the Guideline that applies to the gambling
business provision, see USSG § 2E3.1(a)(1) (Nov. 2007), or an
entirely different sentence.
Second, the merger problem that the plurality opinion and
Justice Stevens seek to avoid assumes the correctness of
the interpretation of the promotion prong of the money laun
dering statute that the Seventh Circuit adopted in Santos’
direct appeal, i. e., that a defendant “promotes” an illegal
gambling business by doing those things, such as paying em
ployees and winning bettors, that are needed merely to keep
9 United States v. Booker, 543 U. S. 220 (2005).

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548 UNITED STATES v. SANTOS
Alito, J., dissenting
the business running. As Santos’ brief puts it, the merger
problem arises when the interpretation of “proceeds” as
gross receipts is “[c]ombined with the Government’s broad
application of the ‘promotion’ prong of the money laundering
statute.” Brief for Respondent Santos 6. But the meaning
of the element of promotion is not before us in this case,
and it would not make sense to allow our interpretation of
“proceeds” to be dictated by an unreviewed interpretation of
another statutory element.
Third, even if there is a merger problem, it occurs in only
a subset of money laundering cases. The money laundering
statute reaches financial transactions that are intended to
promote more than 250 other crimes, ante, at 516 (plurality
opinion), as well as transactions that are intended to conceal
or disguise the nature, location, source, ownership, or control
of illegally obtained funds. See 18 U. S. C. § 1956(a). The
meaning of the term “proceeds” cannot vary from one money
laundering case to the next, and the plurality opinion and
Justice Stevens inappropriately allow the interpretation
of that term to be controlled by a problem that may arise in
only a subset of cases.
B
The plurality opinion defends its interpretation by invok
ing the rule of lenity, but the rule of lenity does not require
us to put aside the usual tools of statutory interpretation or
to adopt the narrowest possible dictionary definition of the
terms in a criminal statute. On the contrary, “[b]ecause the
meaning of language is inherently contextual, we have de
clined to deem a statute ‘ambiguous’ for purposes of lenity
merely because it was possible to articulate a construction
more narrow than that urged by the Government.” Moskal
v. United States, 498 U. S. 103, 108 (1990) (citing McElroy
v. United States, 455 U. S. 642, 657–658 (1982)). As I have
explained above, the meaning of “proceeds” in the money
laundering statute emerges with reasonable clarity when

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549 Cite as: 553 U. S. 507 (2008)
Alito, J., dissenting
the term is viewed in context, making the rule of lenity
inapplicable.
* * *
For these reasons, I would reverse the decision of the
Court of Appeals, and I therefore respectfully dissent.