The reason I have a problem with it is that it seems to all be security theater. In what world would anyone who is using the money nefariously write that down on the form? I get monitoring for multiple transactions to get around the law, and maybe a signature to prove an in-person transaction and create a paper trail. But why ask about how the money will be used?
It’s like asking an apparent criminal if they are a cop.
Not really. Look, a CTR is no big deal. It doesnt start a investigation or a audit.
A SAR can start a investigation or a audit.
The fact that you protest and refuse to sign may make the bank file a SAR. The SAR can lead all sorts of places, including a IRS audit.
Police dont get SARs. The FBI and IRS do. Other federal agencies can.
So, the IRS sees $20000 in cash and the income reported on the 1040 does not show what they would come to expect with that much cash. Tax audit time. They will do several methods to determine your real taxable income. You will have to show that $20000 is not taxable. That’s kinda hard.
The FBI has you on a watchlist as your name comes up on a message board devoted to Middle eastern extremists. Hmm, $20000 eh? Better look harder. Get a warrant, tap his phone, etc.
Again, the reason is optional. The Feds do not require that.
However, the bank likely wants it as they can look at the reason and look at your account history and NOT file a SAR. It’s helping them not rate you as suspicious.
You are missing the point. You asked if you could get in trouble if you said the money was for one thing and then changed your mind and spent it for another. To the extent that you did not lie deliberately in relation to official government business, you are quite obviously fine. To the extent that you intended to deceive, you would be placing yourself at risk. Whether the risk is modest or great is beyond my ability to tell; it is just that by deliberately trying to deceive the government, you’ve gone from no risk to risk.
Again, you are a current or former police officer, right? Shouldn’t you know this?
Literally everyone in this thread has told you that there’s no problem with withdrawing cash to do whatever legal things you want to. When you start layering on other behavior on top of that - whether structuring or lying or whatever - that’s when things get a little iffy.
FWIW: Four years ago I bought a Corvette and put a 5-figure down payment on it.
The money came from my taxable Schwab account and went electronically to my checking account at my local bank. From there, I had a bank draft made out to the local Chevy dealer.
I buy the car, give the dealer the bank draft, and that was that . . . UNTIL a few weeks later when the bank manager called and asked me about the check. I don’t remember exactly what she asked me, but everything from start to finish was as above-board as it could be. I’m sure the dealer had deposited the check by then, so she had full access to anything and everything concerning that check, including the original source of the money.
I did get a little pissy with her because it was all so silly. I came away thinking that she – and probably a lot of bank employees from coast to coast – are paranoid of the Feds and the money laundering issue.
I’m not excusing her dumb questions to me, but in some sense I can understand going way beyond what is necessary to keep the SWAT team from descending on your business.
Does the word “hypothetical” mean anything to you? Because that’s what my statements were a couple of posts ago. Geez. :rolleyes:
Look, if you are going to post a question on an Internet message board oriented around questions in a forum called General Questions in which factual answers are solicited, I’m going to assume that you are asking a question to get a response.
But… more likely the conversation goes like this…
“$20,000 and no plausible explanation for me? I will take this money as proceeds of crime. Should you want it back, the procedure under civil forfeiture are well known and you are welcome to hire a lawyer to try and get it back.”
No charges necessary. No proof of crime necessary. Simply carrying a large enough amount is suspicious. In fact, the police would prefer it be $1000, because when it reaches $20,000 it’s actually cost-effective to hire a lawyer.
The point is - all ***CASH ***transactions are recorded. As a result, should a name pop up anywhere the authorities have all the details laid out for them to investigate you. No need for warrants to ask for bank records. If they can match up $20,000 you withdrew to $20,000 some car dealer deposited, and a record of a car being registered, no problem. If a car dealer sells a car to someone for cash, he details the transaction but there’s no indication where the cash came from for the buyer - maybe investigate for tax evasion or deeper offenses.
As I said earlier - they are making it difficult for the average drug kingpin to live a decent life. All the high life expenses cost money. If that money materializes from the ground as cash, rather than having a paper trail where it originated, then it indicates a criminal enterprise. You can’t drive an gold-chrome Escalade if buying one alerts the authorities. Ditto for that expensive penthouse.
This is why criminals like pizza places, vending machines, and bars and such - where the business “earns” large amounts of cash. It becomes easy to mix in the illegal cash with the regular business cash deposits… until the police estimate how much the business should be taking in and decides to stake it out.
Yeah. And I’m asking what would happen if someone didn’t refuse to fill out the stupid form but did falsify what they were doing with the money. It’s a valid question to ask, doesn’t mean I’m going to do it.
Next time you’re looking at one of those forms, I’d suggest reading the fine print to see if there are any legal penalties for deliberately falsifying information.
But suppose for the sake of discussion that there are no legal penalties for giving a bullshit answer to the question “what will you be doing with that money?”. My guess is that for one or two such cash withdrawals, it wouldn’t matter since nobody will come asking. but consider the hypothetical posed upthread by Lemur866, in which you’re withdrawing a couple grand per day every day - and each time you say “it’s for home improvements,” but it’s actually for paying off an ill-advised bet with a friend about eating fifty hard-boiled eggs in an hour. Eventually that withdrawal pattern is going to pop up on someone’s radar, and the FBI might choose to stop by to ask you some questions - starting with “Can we see these fabulous home improvements you’ve been paying $62K per month for?” Maybe you exercise your right to be free of unreasonable searches and seizures, and refuse to let them into your house. At which point they say “OK, so can you just tell us about these fabulous home improvements?” Now you exercise your right to remain silent, and they leave - but they start investigating your finances behind the scenes. If you’ve just been stockpiling cash in a pirate’s treasure chest in your backyard, they won’t find anything untoward in your finances, and they’ll scratch their heads a bit and give up. Or maybe they’ll start talking to your friends, neighbors and employer, and asking them if they have any idea what you might be spending $62K in cash per month on. Or they start auditing your friends and neighbors, and find out that one of them has been depositing $62K in cash per month in their savings account - and they weren’t declaring it as taxable income. Case closed. You’re off the hook in this particular hypothetical, but your friend gets justifiably penalized for tax evasion. Alternatively, maybe he has been declaring it as taxable income, in which case the FBI says OK, great, everything’s above-board, and they go home without busting anybody.
I’m not saying there aren’t any penalties for lying on those forms, but I don’t think there necessarily needs to be a penalty for lying to the bank about what you do with your money; the disincentive for lying is that it’s difficult enough to come up with plausible answers (that dissuade investigation) if you’re doing something illegitimate with very large amounts of cash.
18 USC 1001 states:
The question of whether an action to misrepresent the use of a perfectly legal cash withdrawal for the main purpose of frustrating the bank’s efforts to comply with Federal laws regarding money laundering is not exactly an open-and-shut case. However, as I said in a previous post, making a good-faith effort to comply leaves a bank customer with zero risk. Intentionally lying to mislead the bank and Federal investigators leaves one with some risk. I’m not saying that Federal agents will chase down anyone and tackle them in the streets over this. I’m saying that it leaves a person with exposure to a Federal crime.
Ok, say Warren Buffet or Bill Gates walks into a bank and withdraws $10 million in cash, would the Feds bother investigate? I mean, obviously both men have the resources to legitimately have that much money.
If I was a billionaire and withdrew a large amount of cash, would filling a vault full of money so I could swim like Scrooge McDuck be a valid reason or would the Feds investigate that too?
Anything you want to do with your money that’s legal is a valid reason, and that includes making a giant pile of Benjamins in your living room. See my link upthread, in which Matthew Inman withdrew over $200,000 in cash just so he could take some pictures with it. I have no idea whether his bank asked him any questions about his withdrawal, or what he might have told them if they did.
Would the Feds come and investigate? Who knows? They might come to your door and ask. You can tell them “I’m acting out my Scrooge McDuck fantasy, just like the paperwork said.” They might ask if they can see your money pit; you have the right to tell them yes, or send them away. If you send them away, they might dig into your financial records (to the extent that they can do so without a search warrant), and, on finding nothing untoward, they’ll drop the matter.
A truthful, legally-permissible reason doesn’t preclude investigation - but an investigation doesn’t require you to waive your fourth or fifth amendment rights.
Well, sounds good, but honestly-* CTRs never start any investigation or audit.* So, no the FBI wouldnt get suspicious as they would never know. Unless…
However, IF you got called in for a routine audit, yes the auditor/agent would have the record of all those CTRs and would ask probing questions. Lying on the form means the auditor is totally within his/her right to assume the funds are taxable income and charge you for taxes on that amount.
If you got investigated for any other reason, they also would see those forms. Like maybe a FBI background investigation? So our OP tries to move to another LEO job, the FBI checks those, finds the lie, and fails him on the background investigation.
If the Bank just filed a CTR, no. CTRs do not start any investigation. 15 million or so are filled every year.
If the bank thought that amount was “suspicious” and filed a SAR? Then, possibly yes. Being Buffet, they might check to see if it was really him or he wasn’t being taken in by some scam or being forced to pay ransom money or something. In other words, they would check to protect him. That is another use of SARs, checking for elder abuse and scams.
CTRs wouldn’t even be filed for daily withdrawals of $2K each. However, once the bank spots such a pattern of withdrawals, wouldn’t you expect them to file an SAR?
Also, if you’re making withdrawals from your account, I can’t see why they’d be considered taxable income - but like I said, if they came knocking (even if only during a run-of-the-mill IRS audit), one would expect they’d ask you where all that money is going.
Yes, that would start a SAR, no doubt. I was thinking of the OP funds issue, however.
They would want to know exactly where you got the $2000 daily.
This is the main issue. So many of these are filed that nobody has the time to read them all, let alone investigate the details.
If I had to guess, they have computer programs looking for patterns - people who do this, multiple withdrawals or deposits in certain areas, matches to names, abnormally high cash returns for certain businesses… etc. To trigger a computer alert I assume would take quite a few transactions.
Here’s a perfect example of why the bank asks questions. Do you think any financial company wants to read about themselves in a New Yorker article such as this: https://www.newyorker.com/culture/personal-history/my-mother-and-her-scammer