I strongly disagree that it's authoritarian to audit lots of transactions - 10k is high enough that most people will only hit it when 1) buying a car (or other vehicle - i.e. boat) 2) purchasing a house 3) doing a renovation. Otherwise most normal transactions will be well below this level.
I do think that eventually it'd be good to revisit the specific threshold for reporting but 10k still feels incredibly reasonable to me and calling it borderline authoritarian seems quite hyperbolic.
Bear in mind that money laundering is extremely effective and difficult to combat without really strong reporting laws and that the detection of money laundering is what leads to take downs of most large criminal organizations since, once you take away their wallet, most of them wither in efficacy.
Money has definitely become inflated since that 10k figure was originally established - but I don't think it passed a significant threshold societally like, say, five dollars passed.
Five dollars was enough to get a modest lunch pretty much anywhere in the 70s and is now, in the affluent parts of the country, around the expected cost for a coffee.
10k, in my mind and opinion of course, went from being "Hey, that's a lot of cash" to "Hey, that's a lot of cash". It remains an amount we (most people at least) don't trivially deal in on a day to day basis and that's where I think the cutoff for this reporting law should be. If most people are going to trigger a mandatory report then LEOs have a lot more data about transactions that are common in society which may be a privacy concern but certainly lowers the usefulness of that ledger - if these transactions are still "rare" then there is a volume of data that can be hand-sifted through to produce interesting insights.
With computers and everything in theory we could probably now handle the volume of tracking the full list of every person's transactions but that would lead to normalizing refusing to report large transactions and we'd only end up seeing the transactions that are made by completely innocent people.
$10,000 makes absolutely no sense in this day and age. The Bank Secrecy Act was made in 1970 and 10k was >250k in todays dollars. It is borderline authoritarian to audit all transactions over 10k now.
I feel like the signal-to-noise ratio must be terrible, especially as inflation gradually lowers the meaning of a $10,000 reporting limit. Selling a used car is enough to trigger a reportable amount of cash.
I'd think what we need is less magic numbers, and instead a better training/reporting ecosystem that insulates people with good intentions but gives them the right tools to identify criminal behaviour.
Actually expecting banks to know their customers at a personal level should be the goal.
I suspect, in contrast, everyone involved likes a fixed 10k limit because it provides a convenient liability hand-off. Compliance can be automated on a much greater level and they can say "we filled out the appropriate forms when required, how were we supposed to know that Hamas Cupcakes Inc was a front?"
Typically it is illegal to not report a transaction over 10k. That is the law that was broken, not "money laundering" of course if you move a lot of money around just under the 10k, that is legal unless you knowingly break it up so that you don't have to report it.
The 10k rule mentioned is totally a thing. I was at a company implementing AML for the first time, and the compliance team told us to add it, which I always thought was an inane. They came up with a variety of rules with just arbitrary figures in them, including the 10k rule. Didn't matter if you had previously been transacting 7k regularly before jumping to 10k, didn't take overall volume into account, didn't look for unusually high acceleration of transactions. Just a magic number pulled out of industry precedents.
The interesting thing was if you read the actual legislative requirements it was excessively vague, like "take reasonable steps to find suspicious transactions". Institutions don't build software if they don't have to. The goal always was to do the minimum to check the box, not actually find laundered money.
Those things are not illegal per-se but can be signals of things resulting from illegal transactions. So, they are more a heuristic --but not following procedure because it can be used to evade detection is made illegal.
The one thing I don't understand is why some of those figures rarely keep up with inflation. I think they should. 10,000 isn't what it used to be.
Is it illegal to have $10,000? If you're referring to financial reporting requirements, the law is just that the bank has to report when you make large deposits (and I think withdrawals as well) it's not a crime, though it is a crime to intentionally deposit multiple amounts less than $10,000 to try and evade the reporting requirements. If you're referring to civil asset forfeiture or something, then I agree work needs to be done to reign in the practice.
You are incorrect: "Transactions under $10k" are not legally suspicious, but rather, multiple transactions that are very large but under $10k but when added together are more than $10k. It's not that easy to end up under scrutiny for structuring unless you're running a cash heavy business without declaring it. Moreover, 99% of the time, the "scrutiny" is "fill out this paperwork"
Cash transactions over $10k have to be reported to the IRS. You'd have to provide ID and TIN. If that weren't the case, criminals wouldn't have had problems with money laundering.
See also: the $10k reporting threshold for banks. Deliberately doing smaller transfers to avoid the reporting threshold can be illegal (depending on intent), and the banks are legally mandated to report suspicious activity (such as that) as well.
To be clear, the ~10k USD cash limit before reporting is standard in all highly advanced countries for global money laundering agreements. You see these same restrictions when travelling internationally.
Government already has quasi-unlimited tracking and control over your transactions through banks. $10,000 deposits are reported. Suspicious activity on anything over $5,000 is reported. These are small sums of money from the perspective of a government. They're easily small enough that any individual who tries to step out of the lower class easily gets under the eyes of government.
This problem should be tackled at the root. The reporting law (report transactions >10K is antiquated). The federal government can set up other ways of finding "interesting" transaction patterns that have nothing to do with a specific threshold that continually lowers in real value due to inflation.
Drop the 10K reporting requirement and there is no need a structuring law except as a way to "get" people that they can not "get" in another way.
I'd argue there's a big difference between a law which requires reporting a transaction and one which criminalizes it.
I have no problem reporting large cash transactions. I do have a problem keeping all my money in electronic accounts that can be vaporized by government fiat, hacking, bank insolvency, clerical error, EMP, etc.
That won't fly due to practical limitations but it certainly makes you wonder why they would even want such ridiculously low limits to begin with. And agreed, that much 'protection' is ridiculous. But the current 40K limit is manageable for small businesses, who rarely transact such amounts in one go. I've had maybe 10 of those over the last five years and in each case the reporting requirement was easily dealt with.
I do think that eventually it'd be good to revisit the specific threshold for reporting but 10k still feels incredibly reasonable to me and calling it borderline authoritarian seems quite hyperbolic.
Bear in mind that money laundering is extremely effective and difficult to combat without really strong reporting laws and that the detection of money laundering is what leads to take downs of most large criminal organizations since, once you take away their wallet, most of them wither in efficacy.
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