Invasion of privacy and the criminalization of having too much money in cash.
My daughter bought a used car from a reputable dealer a couple of months ago and, to assure the dealer of her own reputability, paid cash for the vehicle. Upon withdrawing the necessary funds from her bank account, though, the bank teller handed her a small flyer on which was printed the “Notice to Customers: A CTR Reference Guide.”
CTR refers to Currency Transaction Report, a requirement the Federal government foisted on banks for reporting cash withdrawals or deposits of more than $10,000. My daughter’s withdrawal was considerably less than that, but she had received the warning notice that too-large cash transactions receive government scrutiny.
She had received the warning notice that too-large cash transactions receive government scrutiny.
While not over the $10,000 limit, her withdrawal was presumably large enough that she could be suspected of “structuring” her cash transactions so that no one of them would surpass the $10,000 trigger for a CTR. Such attempts to “stay beneath the radar” are illegal. So even if she were making a legal transaction of $15,000 (which she wasn’t—the car cost less than $10,000) but took out three withdrawals of $5,000 each in order to avoid government surveillance of her transaction, she would have been committing a crime. This means the government has concocted a way to turn someone into a criminal for something that is otherwise a completely innocent transaction.
The government has concocted a way to turn someone into a criminal for something that is otherwise a completely innocent transaction.
Ostensibly, the law behind Currency Transaction Reports is intended to catch drug dealers, terrorists, or other low-lifes who transact their business in cash. But the consequence of the law (whether intended or not) is that the actions of law-abiding citizens who withdraw more than $10,000 cash from their checking accounts are under suspicion without probable cause and must be reported. Worse, to avoid the illegitimate scrutiny of the government of an otherwise legal transaction, innocent behavior has been criminalized.
CTR laws have grown increasingly invasive since first introduced in 1986. As Wikipedia glibly reports:
When the first version of the CTR was introduced, the only way a suspicious transaction less than $10,000 was reported to the government was if a bank teller called law enforcement. This was primarily due to the financial industry’s concern about the right to financial privacy. On October 26, 1986, with the passage of the Money Laundering Control Act, the right to financial privacy was no longer an issue. (emphasis mine)
Suddenly, it seems the law magically relieved us from worry about the invasion of privacy.
Suddenly, it seems the law magically relieved us from worry about the invasion of privacy. Ten years later, another iteration of the statute introduced the Suspicious Activity Report—which can be triggered by an otherwise un-suspicious cash transaction of more than $10,000.
So here we are: A crime has been invented for honest citizens to fall victim to. My daughter’s helpful notice from the bank doesn’t make any bones about it: “Federal law makes it a crime to break up transactions into smaller amounts for the purpose of evading the CTR reporting requirement and this may lead to a required disclosure from the financial institution to the government” (emphasis mine).
That’s Big Brother language if I ever heard it. The wrong-headed law inventing the CTR sprouts the many-headed opportunity for an otherwise law-abiding citizen to become a criminal, just for wanting to have cash on hand.