Sin categoría

Structuring Cash Transactions Under $10,000 is Criminal!

Man Sentenced for Making and Selling Bootlegged DVDs and CDsOn Aug. 27, 2014, in Hartford, Connecticut, John W. Rice, of Windsor, was sentenced to 18 months in prison, three years of supervised release. In addition, Rice Law Lets I.R.S. Seize Accounts on Suspicion, No Crime Required forfeited $48,195 seized from his bank account, a 2005 Chevrolet Corvette and a 2012 BMW 650i. On April 25, 2014, Rice pleaded guilty to one count of criminal copyright infringement and one count of money laundering.

Under the Bank Secrecy Act, cash deposits of 10 grand or more must be reported by financial institutions. Georgia Man Sentenced for Investment Fraud SchemeOn June 25, 2014, in Peoria, Illinois, Kenneth Lewis of Augusta, Georgia and Cranford, New Jersey, was sentenced to 271 months in prison and ordered to pay $5,565,406 in restitution. Lewis was convicted of four counts of wire fraud and 11 counts of money laundering. According to court documents, beginning in the late 1990s, Lewis offered investors the ability to generate income through highly secretive overseas financial transactions. He obtained more than $5.5 million from victims to cover his living expenses while he was purportedly working on completing the details of non-existent transactions.

New Law Stops IRS From Stealing People’s Money Simply Because It Deems Their Bank Deposits Suspiciously Small

A person convicted of tax evasion for structuring cash transactions to avoid federal reporting requirements can face anywhere from three to five years in prison. Substantial monetary penalties may also apply, including fines as high as $250,000 for individuals and $500,000 for corporations and significant civil penalties. Of course, making smaller cash deposits does not mean that a person is trying to defraud the government or engage in structuring. Many small businesses and freelancers deal in cash transactions every day. There are myriad reasons why people make smaller cash deposits or withdrawals.

Law Lets I.R.S. Seize Accounts on Suspicion, No Crime Required

MyBankTracker generates revenue through our relationships with our partners and affiliates. We may mention or include reviews of their products, at times, but it does not affect our recommendations, which are completely based on the research and work of our editorial team. We are not contractually obligated in any way to offer positive or recommendatory reviews of their services. Again, depending on the bank, you may not be allowed to deposit your $10,000 check via mobile deposit on your phone, or at an ATM. Writing a $10,000 check to yourself (or getting one from someone else) follows the same process as cash, albeit a bit more inconveniently. It’s not just large deposits over $10,000 structured into small amounts that count.

Is the IRS seizing the bank accounts of innocent Americans under civil forfeiture laws?

According to court documents, between 2000 and 2013, doing business as “Dr. Jay’s Entertainment,” Rice manufactured copies of motion pictures, television shows, and music that were copyrighted works, using recordable blank DVDs and CDs. Rice displayed and sold the bootlegged merchandise in a variety of locations and advertised and sold the materials over the internet. A total of 8,913 DVDs and 11,410 CDs were seized from Rice and Dr. Jay’s Entertainment.

Law Lets I.R.S. Seize Accounts on Suspicion, No Crime Required

There are too many horror stories of people who complied with the law only to be accused of being a drug dealer and then had their money confiscated. In fact, when I once took a flight https://accounting-services.net/accounting-for-issue-of-ordinary-shares/ from Cancun to Germany, I saw these reporting requirements at work. The reporting requirement was created to nab drug traffickers, racketeers and terrorists by tracking their cash.

IRS Rules for Depositing More Than $10,000 Cash in a Bank Account

But given that this policy lacks common sense as is, it might be an uphill battle. He states that society’s trust in the police is essential, but in the US this trust has been undermined by civil forfeiture. And it’s not just the IRS that is doing all the seizing, it is often local police departments too. Russia, Italy, Mexico, Uruguay, and Spain have also created similar laws limiting cash payments over a certain value.

Can the US government seize bank accounts?

So, can the government take money out of your bank account? The answer is yes – sort of. While the government may not be the one directly taking the money out of someone's account, they can permit an employer or financial institution to do so.

What has caused controversy is when the property of innocent persons is seized by police who believe that the seized items were involved in criminal activity. To get back the seized property, owners must prove it was not involved in criminal activity. Sometimes it can mean a threat to seize property as well as the act of seizure itself.[2] Civil forfeiture is not considered to be an example of a criminal justice financial obligation. Critics say this incentive has led to the creation of a law enforcement dragnet, with more than 100 multiagency task forces combing through bank reports, looking for accounts to seize.

Before it can seize property in a structuring case, special agents of the IRS Criminal Investigation Division prepare a seizure warrant affidavit. Its approved internally and then reviewed by an Assistant U.S. Attorney and a manager. If they agree the affidavit is legally sufficient, they go before a federal magistrate judge. Rep. Dave Camp (R-MI) and Rep. Sander Levin (D-MI) introduced the ​Taxpayer Protections Against Abusive Seizures Act to add protections against civil forfeiture laws.

  • JoLynn Van Steenwyk, the fraud and security manager for Northwest, said she could not discuss individual clients, but explained that the bank did not have access to past account histories after it acquired Ms. Hinders’s branch.
  • But, a business with frequent moderate-to-large-sized transactions may not seem unlikely to receive or pay $10,000 in check, even if the amount is still reported to the IRS.
  • Besides, the IRS says there are already due process protections in place to protect you if you are innocent.
  • There are other governments that might confiscate your safe deposit box too.

It’s considered a crime, even if you earned the cash legally. Now, banks aren’t necessarily the bad guys here; they’re obliged to follow these procedures. But it certainly beats getting sent to jail or paying a hefty fine. And that’s how a local police station can end up with a new daiquiri machine.

Marijuana legalization and forfeiture

The government can take the money without ever filing a criminal complaint, and the owners are left to prove they are innocent. In fact, it’s a problem that can make one $10,000 deposit look like mere pennies. Not only does it implicate them in possible illegal activity, but the act of structuring itself is illegal; it tells the government that you’re trying to get around and evade their reporting laws. Hong Kong was previously notorious for not having any currency reporting limits, until a new law passed in 2018. Since then, all travelers must declare cash sums greater than HK$120,000 when they move in or out of the country. While Hong Kong is still one of the last places on earth that I expect to see a war on cash, this new law was passed to prevent money laundering.

  • If you withdraw more than $10,000 in cash at a time, the transaction will be reported to the IRS.
  • This can seem out of the ordinary to your bank, triggering their investigative process.
  • One method of intercepting funds is by highway interdictions, typically along highway routes suspected to be used regularly by drug smugglers, often between Mexico and the United States.
  • And as you might imagine, the government would like you to resolve all doubts in favor of reporting.

Banks are not permitted to advise customers that their deposit habits may be illegal or educate them about structuring unless they ask, in which case they are given a federal pamphlet, Ms. Van Steenwyk said. Ms. Hinders said that she did not know about the reporting requirement and that for decades, she thought she had been doing everyone a favor. Demonstrating awareness and cooperation goes a long way in encouraging transparency. Remember that account holds, IRS reporting and the like aren’t there to criminalize you or make your life more difficult. But if having a hold placed on your account is a total inconvenience, contact your bank to see if they can free up or advance some of the funds before they clear. It could mean your card was stolen and someone went on a spree; or, you might just be on vacation and spending more than usual.