RLCleary: we will let everyone decide on their own whether or not my post has value or not. I feel certain most people will read what I write as it is intended- for specific legal guidance consult an attorney… this is an open forum… expect some opinion.
However, I will be happy to break this down complete with legal cites:
1) 26 USC 7201 makes it a felony to attempt to evade or defeat any federal tax.
2) 31 USC 103.18(a)(1) states in relevant part that: A bank may also file with the Treasury Department by using the Suspicious Activity Report specified in paragraph (b)(1) of this section or otherwise, a report of any suspicious transaction that it believes is relevant to the possible violation of any law or regulation but whose reporting is not required by this section.
3) 31 USC 103.18(2)(i)-(iii) discloses under which circumstances a financial institution is REQUIRED to file a SAR.
I think these three bullet points about sum it up. 1), we have established that tax evasion is a crime and according to bullet 2) it can be reported voluntarily on the SAR. If the activity meets the guidelines established by the law noted under bullet 3) it must be reported. This should be pretty clear but I’m sure those that want to pick it apart will.
The main thing here is this… it doesn’t really matter what you *THINK* the underlying criminal activity is- you are to report the suspicious activity. The reason we don’t see things like tax evasion, narcotics trafficking, extortion, public corruption etc as options under Part III section 35 is because you (as a banker) are not in a good position to really know what the underlying criminal activity is, you are just an unwilling participant so to speak. The reason we do see things like check kiting, loan fraud, embezzlement etc is because you (as bankers) are in a much better position to know specifics- after all, in most of those instances you are the victim.
Like I said in my first post, what you may think is tax evasion is really drug money laundering or vice versa. So why don’t we do this… you guys use the SARs to report suspicious transactions and leave it up to the 5-0s to determine the underlying crime.
RL, should you have further qualms with my post, please provide specific legal references as to why I am wrong. Thanks