# Would this be considered money laundering? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [October 17, 2015, 6:48pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919 "2015-10-17T18:48:35Z")\ **Posts on this page:** 13\ **Page:** 2
**Author:** ![Chefguy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chefguy/32/138_2.png) [@Chefguy](https://boards.straightdope.com/u/Chefguy)\ **Post date:** [October 18, 2015, 4:20pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/21 "2015-10-18T16:20:23Z")
> [@VinylTurnip](#): > > You asked whether a specific person you know, whom you describe as a longtime asshole, is engaged in criminal activity. If it was meant as a general question about the law, then I’m sorry for having misread. General question, and yeah, the guy is a dick. Cite: he negotiated (via email) a sale price on the house of a elderly couple who were moving permanently to Mexico. Knowing full well that the husband is dying of ALS, he then tried to lowball the offer price when she flew up here to sign the papers, figuring that she would just unload it so she could get back to her husband, who needs full time care. Luckily, she’s a pretty tough customer. He’s done other dickish things that I won’t go into, but I probably could have left off the descriptive when posing my question. There are tons of marijuana retail and medical places all over the city. Someone in city government proposed a “green mall” downtown so that tourists will flock here. I don’t doubt that it will gain traction, this being a place where government doesn’t really think things through. But I’m very curious about any fallout from having all this cash lying about, and legal problems trying to clean it up so that the banks will take it. We’re talking millions of dollars, which is a lot to stuff in your mattress. ---
**Author:** ![Dag\_Otto](https://avatars.discourse-cdn.com/v4/letter/d/439d5e/32.png) [@Dag\_Otto](https://boards.straightdope.com/u/Dag_Otto)\ **Post date:** [October 18, 2015, 11:08pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/23 "2015-10-18T23:08:11Z")
Slight hijack, but related topic: States that allow recreational marijuana tax the sales. How are the taxes paid if dispensaries can’t use a bank? Does the state just accept stacks of cash? ---
**Author:** ![Lord\_Feldon](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lord_feldon/32/341_2.png) [@Lord\_Feldon](https://boards.straightdope.com/u/Lord_Feldon)\ **Post date:** [October 19, 2015, 4:03am UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/24 "2015-10-19T04:03:17Z")
> [@Dag\_Otto](#): > > Does the state just accept stacks of cash? [Yes](https://www.washingtonpost.com/blogs/govbeat/wp/2015/04/27/rising-marijuana-sales-leave-pot-shops-flush-with-cash-they-cant-deposit/), although apparently in Washington 75% of marijuana businesses find another way: > [@](#): > > The Oregon Liquor Control Commission has taken note of trends in Washington, where Smith estimated that about a quarter of all marijuana-related businesses are paying their taxes in cash, and Colorado, where a spokeswoman for the state Department of Revenue said cash “seems to be the primary method of payment for marijuana businesses.” > > The logistical challenges for the state are nothing compared to those for businesses, the vast majority of which have just a handful of employees. > > “We still have people paying their taxes in cash by hiring the Brinks truck,” said Dan Riffle, a spokesman for the pro-legalization Marijuana Policy Project. This might be one of the few situations where cash being legal tender is relevant to anybody. I don’t think the state could actually refuse to accept cash payments for tax bills. ---
**Author:** ![Tom\_Tildrum](https://avatars.discourse-cdn.com/v4/letter/t/e95f7d/32.png) [@Tom\_Tildrum](https://boards.straightdope.com/u/Tom_Tildrum)\ **Post date:** [October 19, 2015, 3:43pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/25 "2015-10-19T15:43:40Z")
> [@Dag\_Otto](#): > > States that allow recreational marijuana tax the sales. By the way, any income is taxable at the federal level as well. ---
**Author:** ![Doctor\_Jackson](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/doctor_jackson/32/32_2.png) [@Doctor\_Jackson](https://boards.straightdope.com/u/Doctor_Jackson)\ **Post date:** [October 19, 2015, 5:58pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/26 "2015-10-19T17:58:46Z")
> [@Inna\_Minnit](#): > > It is illegal on the federal level. Which is where banks operate in regards to the law. It’s not so [cut-and-dry](http://www.nytimes.com/2012/04/03/business/small-banks-shift-charters-to-avoid-us-as-regulator.html?_r=0)as that. There are many state chartered banks and credit unions whose primary oversight comes from State banking regulators. The only Federal regulation of these institutions comes from the Federal Reserve Bank if the bank is a Federal Reserve System member or the FDIC if not. Neither of those agencies has nearly the muscle of the Office of the Comptroller of the Currency (OCC), which monitors nationally chartered institutions. Even with a minimum of Federal oversight, however, state chartered institutions may well be reluctant to deal with cannabis companies. ---
**Author:** ![Chefguy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chefguy/32/138_2.png) [@Chefguy](https://boards.straightdope.com/u/Chefguy)\ **Post date:** [October 19, 2015, 8:36pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/27 "2015-10-19T20:36:57Z")
> [@Doctor\_Jackson](#): > > It’s not so [cut-and-dry](http://www.nytimes.com/2012/04/03/business/small-banks-shift-charters-to-avoid-us-as-regulator.html?_r=0)as that. There are many state chartered banks and credit unions whose primary oversight comes from State banking regulators. The only Federal regulation of these institutions comes from the Federal Reserve Bank if the bank is a Federal Reserve System member or the FDIC if not. Neither of those agencies has nearly the muscle of the Office of the Comptroller of the Currency (OCC), which monitors nationally chartered institutions. > > Even with a minimum of Federal oversight, however, state chartered institutions may well be reluctant to deal with cannabis companies. I would suspect that the reluctance will disappear when other institutions start hauling in hundreds of millions of dollars. ---
**Author:** ![msmith537](https://avatars.discourse-cdn.com/v4/letter/m/d9b06d/32.png) [@msmith537](https://boards.straightdope.com/u/msmith537)\ **Post date:** [October 20, 2015, 9:51am UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/28 "2015-10-20T09:51:52Z")
How does one buy real estate with cash? I don’t think you can just hand the realtor a suitcase with hundreds of thousands of dollars in it. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [October 20, 2015, 9:55am UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/29 "2015-10-20T09:55:34Z")
> [@msmith537](#): > > How does one buy real estate with cash? I don’t think you can just hand the realtor a suitcase with hundreds of thousands of dollars in it. Of course not. You hand the money to the seller at a closing. Some large portion of it is usually taken by a mortgage company. Perhaps you’ve forgotten, cash is money, just as good as checks and credit cards 🙂 ---
**Author:** ![Doctor\_Jackson](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/doctor_jackson/32/32_2.png) [@Doctor\_Jackson](https://boards.straightdope.com/u/Doctor_Jackson)\ **Post date:** [October 20, 2015, 12:35pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/30 "2015-10-20T12:35:33Z")
> [@Chefguy](#): > > I would suspect that the reluctance will disappear when other institutions start hauling in hundreds of millions of dollars. Or will intensify when the FRB/FDIC decide to play hard ball. I’m not sure which way the Feds will go on this one. neither are the banks, and therein lies the rub. No one wants to be the test case. > [@TriPolar](#): > > Of course not. You hand the money to the seller at a closing. Some large portion of it is usually taken by a mortgage company. Perhaps you’ve forgotten, cash is money, just as good as checks and credit cards 🙂 Cash draws a _whole_ lot more scrutiny, though. Financial institutions, brokerages, car dealers and real estate companies, among others, are required to report to the Federal government any transaction that includes $10,000 or more in cash - or any combination of transactions within “X” timeframe that equal $10k cash, or any transaction for any amount of cash that that the company deems ‘suspicious’. ---
**Author:** ![kayaker](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kayaker/32/441_2.png) [@kayaker](https://boards.straightdope.com/u/kayaker)\ **Post date:** [October 20, 2015, 1:04pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/31 "2015-10-20T13:04:00Z")
They don’t have car washes in Oregon? ---
**Author:** ![Learjeff](https://avatars.discourse-cdn.com/v4/letter/l/94ad74/32.png) [@Learjeff](https://boards.straightdope.com/u/Learjeff)\ **Post date:** [October 20, 2015, 2:31pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/32 "2015-10-20T14:31:53Z")
> [@robert\_columbia](#): > > It looks like form [HUD-1](http://www.hud.gov/offices/adm/hudclips/forms/files/1.pdf) is a _mortgage_ form. Its first box is “Type of Loan”, and I don’t see an option for “none”. Does form HUD-1 really still need to be filled out even if no loan is being used? I don’t see how it would even make sense to fill it out for a purely cash-up-front transaction. Right. I bought a house without a loan, and no banks or HUDs were involved. Of course, any home with an existing mortgage would involve a bank, but only one getting repaid, not one loaning money. The scrutiny over income sources has nothing to do with the HUD anyway. It has to do with the loan underwriter making sure they’ll get repaid. I recently bought a house and due to a few things that the loan officer said “no problem” the underwriter scrutinized me like I’d never seen in 5 earlier home purchases. I was about to say “Never mind, this is too much hassle, I’ll find another bank” when the approval finally came. ---
**Author:** ![Chefguy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chefguy/32/138_2.png) [@Chefguy](https://boards.straightdope.com/u/Chefguy)\ **Post date:** [October 20, 2015, 4:22pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/33 "2015-10-20T16:22:51Z")
> [@kayaker](#): > > they don’t have car washes in oregon? Ha! ---
**Author:** ![ReticulatingSplines](https://avatars.discourse-cdn.com/v4/letter/r/e274bd/32.png) [@ReticulatingSplines](https://boards.straightdope.com/u/ReticulatingSplines)\ **Post date:** [October 20, 2015, 6:33pm UTC](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919/34 "2015-10-20T18:33:08Z")
> [@Chefguy](#): > > I would suspect that the reluctance will disappear when other institutions start hauling in hundreds of millions of dollars. Believe me, banks are two steps ahead of you. If something would bring in tons of money after compliance costs and potential regulatory fines, they’d already be doing it. But honestly, they [don’t even want your deposits right now anyway](http://www.wsj.com/articles/big-banks-to-americas-companies-we-dont-want-your-cash-1445161083), so why bother? [Previous page](https://boards.straightdope.com/t/would-this-be-considered-money-laundering/734919.md?page=1)