The Spitzer Investigation, Part 2
It is 8:30 AM in Coeur d’Alene, Idaho. Eliot Spitzer is expected to resign from his position as the Governor of New York within the half hour. Unless Spitzer has cut a deal with prosecutors, his resignation should not have any bearing on his prosecution for violation of federal currency transaction laws. Because Spitzer was formerly New York’s Attorney General responsible for prosecuting complex financial crimes, readers might think he would have been smart enough to evade the law. The banking laws have been written to make that kind of informed evasion more difficult.
Anyone with a bank account, anyone who moves money, is subject to transactional surveillance by US banks. For an entertaining (or alarming, depending on your point of view) take on this, listen to a National Public Radio report titled “Bank [sic] Scrutinize Even Routine Transactions” by Adam Davidson.
To have a better understanding of federal currency transaction laws, go to the Internal Revenue Service’s “Bank Secrecy Act” webpage and click on the various links that explain specific Bank Secrecy Act requirements to assist with education and compliance with the law.
If you’re really into money laundering, read the Office of the Comptroller of the Currency’s “Bank Secrecy Act / Anti-Money Laundering - Comptroller’s Handbook”. This little gem is 92 pages long, but it is easily read and understood. It is one of the better primers on money laundering. For example, the Suspicious Conduct and Transactions list begins on the report’s page 12 (page 15 of 92 on the .pdf paginator). That list identifies behaviors that should or could trigger a Suspicious Activity Report.
One of the more interesting crimes chargeable under federal law is “structuring” (31 USC 5324). It is a crime of evasion. This has been mentioned as one of the crimes for which Spitzer is being investigated. In simple terms, “structuring” means the person accused knew of the law and intentionally broke up one or more reportable financial transactions into smaller transactions to get their dollar value below the threshold that would have triggered a report required by law. For a detailed discussion of “structuring”, read “Structuring Financial Transactions to Evade Reporting Requirements - A Trap for Unwary Defendants Yet an Opportunity for Defense Counsel“.
Some readers may feel that the banking laws are too intrusive, that they allow too much official attention to be paid to the financial transactions of honest citizens, citizens who have no desire or intent to violate banking laws. The challenge faced by legislators and law enforcement is that not all citizens are honest. There are citizens who seek out ways to intentionally evade the financial transaction laws and violate them. Typically these violators are financially and legally astute. As violators become more skilled in violation and evasion, the tools available to law enforcement must expand to detect and prosecute the violators.
Anyone with a bank account, anyone who moves money, is subject to transactional surveillance by US banks. For an entertaining (or alarming, depending on your point of view) take on this, listen to a National Public Radio report titled “Bank [sic] Scrutinize Even Routine Transactions” by Adam Davidson.
To have a better understanding of federal currency transaction laws, go to the Internal Revenue Service’s “Bank Secrecy Act” webpage and click on the various links that explain specific Bank Secrecy Act requirements to assist with education and compliance with the law.
If you’re really into money laundering, read the Office of the Comptroller of the Currency’s “Bank Secrecy Act / Anti-Money Laundering - Comptroller’s Handbook”. This little gem is 92 pages long, but it is easily read and understood. It is one of the better primers on money laundering. For example, the Suspicious Conduct and Transactions list begins on the report’s page 12 (page 15 of 92 on the .pdf paginator). That list identifies behaviors that should or could trigger a Suspicious Activity Report.
One of the more interesting crimes chargeable under federal law is “structuring” (31 USC 5324). It is a crime of evasion. This has been mentioned as one of the crimes for which Spitzer is being investigated. In simple terms, “structuring” means the person accused knew of the law and intentionally broke up one or more reportable financial transactions into smaller transactions to get their dollar value below the threshold that would have triggered a report required by law. For a detailed discussion of “structuring”, read “Structuring Financial Transactions to Evade Reporting Requirements - A Trap for Unwary Defendants Yet an Opportunity for Defense Counsel“.
Some readers may feel that the banking laws are too intrusive, that they allow too much official attention to be paid to the financial transactions of honest citizens, citizens who have no desire or intent to violate banking laws. The challenge faced by legislators and law enforcement is that not all citizens are honest. There are citizens who seek out ways to intentionally evade the financial transaction laws and violate them. Typically these violators are financially and legally astute. As violators become more skilled in violation and evasion, the tools available to law enforcement must expand to detect and prosecute the violators.
posted by Bill McCrory | 9:58 AM
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