IRS Seized Millions from Individuals and Small Businesses by Accusing Them of 'Structuring Violations' When Making Deposit Under $10,000
AP - An Iowa widow is charged with a crime and had nearly $19,000 seized from her bank after depositing her late husband's legally earned money in a way that evaded federal reporting requirements.
Janet Malone, 68, of Dubuque, is facing civil and criminal proceedings under a law intended to help investigators track large sums of cash tied to criminal activity such as drug trafficking and terrorism. But some members of Congress and libertarian groups have complained that the IRS and federal prosecutors are unfairly using it against ordinary people who deposit lawfully obtained money in increments below $10,000.
Some of the depositors had broken up the deposits to save their bankers from having to submit paperwork or because they mistakenly believed it was a way to avoid unwarranted government scrutiny. The Treasury Department receives millions of reports every year, and deposits above the $10,000 threshold incur no additional fees or taxes.
"This is shocking because it demonstrates that prosecutors are not taking seriously the IRS' alleged policy change not to prosecute legal source structuring," he said.
"You won't prosecute a widow," Malone said, according to the affidavit.
Spokesmen for the IRS and U.S. Attorney's Office declined to talk about how the case fits with the new policy. Malone's attorney declined to comment.