Feds Graciously Agree Not to Steal Restaurateur's Bank Account

Federal
prosecutors have stopped
trying to steal $33,000 from an Iowa restaurateur who irked the
IRS by making deposits of less than $10,000. The New York
Times
highlighted the case in October, noting that federal law lets
the IRS “seize accounts on suspicion, no crime required.”

Mrs. Lady’s, Carole Hinders’ Mexican restaurant in Arnolds Park,
does not take credit cards, so she has a lot of cash to deposit.
There is nothing illegal about that, although the Bank
Secrecy Act requires financial institutions to report deposits
of $10,000 or more. Deliberately keeping deposits below that
threshold to avoid the reporting requirement is a
crime (known as “structuring”), but Hinders was never charged with
it. Instead federal prosecutors argued that her bank account had
facilitated the crime of structuring, making it subject to civil
forfeiture. 

Larry Salzman, the Institute for Justice attorney representing
Hinders, said she never intended to break the law. “After her
deposition, at which it became overwhelmingly clear that Carole was
an innocent and hardworking restaurateur, the assistant United
States attorney on the case told us that he informed the I.R.S.
that they should not go forward with the case,” Salzman
told The New York Times.

On Saturday, the Associated Press
reports, Assistant U.S. Attorney Matthew Cole filed a
motion saying “the case should be dropped to conserve judicial
resources even though he had evidence Hinders intentionally skirted
bank reporting rules.” Cole said Hinders had told investigators
that her mother advised her to keep deposits below $10,000 as “a
convenience to the bank.” 

[Thanks to Mark Lambert for the tip.]