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Date: Wed, 16 Jul 1997 19:21:14 -0700
To: (Recipient list suppressed)
From: Paul Andrew Mitchell [address in tool bar]
Subject: SLS: Bank Secrecy Act (fwd)

> Harold:
> I recently received this shocking information from the Oxford Club. Are
> you aware of it?
> Ed
> 			*********
> The Greatest Assault On Your Wealth
> Early in 1997, the latest in a string of government regulations that
> target ordinary citizens took effect.  Because of this, you could be
> liable for serious trouble without any idea you'd done anything.  Imagine
> this scenario ...
>          You need to send your brother money for a family emergency.  You
> walk into your bank and purchase a $3,500 money order, with money from
> your savings account.  The teller handles your transaction and says
> nothing.  You drop it in the mail and promptly forget about it.  A few
> days later, you're arrested; and every penny in your savings account -
> your major life savings - is seized.  You're convicted of a felony -
> failure to file a "currency transaction report" (CTR), IRS Form 4789. 
> The bank could have done it for you, but under the law it's your
> responsibility - and the teller stands to make a fortune if you don't
> report it. The teller can collect a reward - up to $150,000!
>          Make no mistake, this scenario is not only possible - situations
> like it are already happening. How can this be?   You may not know this,
> but under the provisions of the Bank Secrecy Act, a CTR must be filed
> with the IRS for any cash transaction involving $10,000 or more.  But
> that's not all.  CTRs must also be filed by anyone purchasing more than
> $3,000 in money orders or making transfers among bank accounts in a
> series totaling $10,000 or more.
> You Can Become a Felon Merely by Making a Banking Mistake
>          Failure to file a CTR is a criminal felony.  And to constitute a
> crime, there is no requirement that the money be involved in any criminal
> activity.  It is a crime simply  not to report  the transaction.  Your
> bank may file it for you - but they may not.  It's not up to them, it's
> up to you.  Besides, the law also applies to private bankers, brokers,
> investment bankers, currency dealers, check cashing firms, credit card
> and insurance firms, metals dealers and jewelers, pawnbrokers, loan
> companies, travel agencies, money senders (such as Westem Union), auto,
> boat, airplane and sales companies, parties to real estate transactions,
> casinos, and others.
>          The penalty?  If you were to make such a mistake, you would be
> liable to a five-year prison sentence and a $250,000 fine.  The law would
> allow the Feds to confiscate any funds they alleged  to be involved, and
> your teller would collect a huge reward.
>          The laws have made banks liable for not conforming to
> regulations requiring them to report these transactions.  They must file
> "suspicious activity reports" on a wide range of activities that may be
> perfectly innocent transactions.
>          Failure to follow these rules can result in civil fines of up to
> $10,000 a day for the bank and prosecution of individual employees
> ($250,000 fines and up to five years in prison).  If they're found guilty
> of "willful blindness," the fines can reach $500,000 and 10 years in
> prison.  Fed investigators are already conducfing "sting" operations at
> selected banks to insure employee compliance. 
>         Welcome to the "free world." But innocent bank transactions
> aren't the, only "crime" that enable the Feds to seize your money. 
> Congress has also criminalized cash and property transactions associated
> by law with nearly I 00 other "specified unlawful activities," ranging
> from toxic waste dumping and trafficking in food stamps to contraband
> cigarettes to violations of the Safe Water Drinking Act and water
> pollution.
> Banking with Big Brother
>          A lot of people don't know this, but in 1996, using the powers
> of the Bank Secrecy Act, the government put into law new "Suspicious
> Activity Report" (SAR) regulations.  These rules - which affect 23,000
> banks and depository institutions - force bank officers and employees to
> act as "cops." Under the rules, they now have a legal duty to report any
> individual or cumulative transactions of $5,000 or more which in their
> judgment might be suspect. 
>          And besides being liable for penalties if they don't report
> these transactions, they have the financial incentives to do so, as I
> mentioned before.
>          But don't think for one minute you have to be a criminal to get
> snared by these
> regulations ...
> - In 1993, the government seized all the real and personal business
> property of I I auto sales dealerships in the Washington, D.C. area.  No
> allegations of drug money or tax evasion were involved.  The firms had
> only neglected to file CTRs on some cash transactions. 
> - Police drained $3,912 from the bank account of a woman in California. 
> Her 30-year-
> old son had been arrested on drug-trafficking charges.  He had not lived
> with her for
> more than 10 years, and she was not charged with any crime.
>          - A doctor who transferred his life's savings to a friend's new
> bank had all his money over $2 million - seized for failing to file CTRs.
>  Although he later won in court, he is out approximately $317,000 In lost
> interest, not to mention his legal fees.
>          - In March 1992, the securities and exchange commission froze
> all the assets of the national law firm of Kaye, Scholer, Fien-nan, Hays
> and Handier, attorneys for the Lincoln Federal Savings and Loan and its
> former president Charles Keating, who was convicted of fraud.  Unable to
> conduct business, the firm settled for $41 million in fines.  All of this
> was done without any due process of law.
>         - In 1994, a New York financier was accused of fraud in one of
> many businesses he owned.  The government sought forfeiture of his entire
> $400 million corporate empire, including an auto dealership, real estate,
> a gold mine, and other legitimate enterprises.  Never mind the quesfion
> of whether it was fair to the businessman, the action was taken with
> absolutely no regard for the unsecured rights of numerous creditors owed
> millions of dollars.
>          It doesn't matter whether you're wealthy or of average income,
> an individual or a corporation - the government is targeting the wealth
> of its citizens, and you are at risk.
>          The Oxford Club believes that your wealth should be secure...
> safe from the govemment, and safe from thieves. 

Paul Andrew Mitchell                 : Counselor at Law, federal witness
B.A., Political Science, UCLA;  M.S., Public Administration, U.C. Irvine

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