S.D.N.Y.: Government satisfied “all records” seizure in money laundering case

In a money laundering case, the government satisfied the “all record” exception to particularity of “pervaded” with fraud. United States v. D’Amico, 734 F. Supp. 2d 321 (S.D. N.Y. 2010):

When there is probable cause to believe that an entire business is “pervaded” or “permeated” with fraud, seizure of all records of the business is appropriate, and broad language used in a search warrant will not offend the particularity requirement. See U.S. Postal Serv. v. C.E.C. Servs., 869 F.2d 184, 187 (2d Cir. 1989); Nat’l City Trading Corp. v. United States, 635 F.2d 1020, 1024-25 (2d Cir. 1980); see also United States v. Smith, No. 05-CR-293A. 2007 U.S. Dist. LEXIS 52377, at *8 (W.D.N.Y. July 19, 2007) (“Although the particularity requirement of the Fourth Amendment creates a general presumption against ‘general’ or ‘all-records’ warrants, courts, including the Second Circuit, have recognized an exception where there is probable cause to believe that criminal activity permeates the business to be searched.”). This is known as the “‘all-records’ exception” to the particularly requirement, United States v. Burke, 718 F. Supp. 1130, 1139 (S.D.N.Y. 1989), although “[t]he principle is not so much an ‘exception’ to the particularity requirement… as a recognition that a warrant–no matter how broad–is, nonetheless, legitimate if its scope does not exceed the probable cause upon which it is based,” United States v. Bowen, 689 F. Supp. 2d 675, 683 n.6 (S.D.N.Y. 2010) (internal quotations and citation omitted).

In order to trigger the all-records exception, “it is not necessary that the affidavit supporting the search warrant set forth specific factual evidence demonstrating that every part of the enterprise in question is engaged in fraud.” Burke, 718 F. Supp. at 1139. “Rather, the affidavit need contain only sufficient factual evidence of fraudulent activity from which a magistrate could infer that those activities are ‘just the tip of the iceberg.’” Id. (quoting United States v. Offices Known as 50 State Distributing Co., 708 F.2d 1371, 1375 (9th Cir. 1983), cert. denied, 465 U.S. 1021, 104 S. Ct. 1271, 104 S. Ct. 1272, 79 L. Ed. 2d 677 (1984)).