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bank or property transfer records for evidence of actual ownership.

V. AUTHORITY TO OBTAIN INFORMATION FROM BANKS, OTHER FINANCIAL INSTITUTIONS AND THIRD PARTIES

While it is recognized that state and local criminal investigators do not have the same powers as many federal investigators to readily obtain information from banks and other third-party sources, there are a variety of steps that can be taken to legally obtain the evidence necessary to detect hidden ownership of businesses, and other assets. Some of the information is readily available either from public records, such as those already discussed in this paper, or, under certain circumstances, from city, county, state, and federal agencies.

Subpoena power, when available through the courts, grand juries, legislative bodies, crime commissions and other administrative groups, should be fully utilized.

When developing sources of information, criminal investigators should not concentrate solely on developing informants among the criminal element or from sources often referred to as "street" sources, whose credibility is so often found to be highly questionable.

Criminal investigators should broaden the scope of this powerful investigative technique and develop informants and cooperative individuals among the white-collar groups who may have knowledge of a target's financial activities, as well as among the white-collar criminal's associates. In other words, develop sources of information among those individuals in the financial community where the profits from a target's illegal activities are actually expended.

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solving crimes, motivated by a greed for money, lies with the development of evidence of the disposition of the fruits of the crime money. In white-collar crimes the proceeds of crime are deposited, and not quickly spent as are the proceeds of street crime. In developing sources of information among those in the financial community, criminal investigators should keep in mind that bank officials, stock brokers, automobile dealers, furriers, jewelry store owners, etc., are all looking to the law enforcement officer for protection from the criminal element, not just from those who commit crimes of violence, but from those who commit white-collar financial crimes as well. The criminal investigator, therefore, literally has his foot in the door in creating a cooperative relationship with the business community.

In developing sources of information within the financial community, criminal investigators should employ the same high standards of conduct, as those employed in developing information from all other sources, to ensure that federal, state, and local statutes are not violated.

VI. CONCLUSION

It is not the purpose of this paper to "sell" criminal investigators on the merits of utilizing financial investigative techniques in the investigation of perpetrators of white-collar crimes or any other crimes that are money motivated. They literally have no alternative.

It has been the experience of the author of this paper, who has conducted and/or supervised the investigation of hundreds of criminal income tax fraud investigations of both white-collar and organized crime violators, that most of

the violators conduct a majority of their financial transactions by use of cashier's checks, money orders, commercial bank accounts, traveler's checks and other instruments of exchange rather than with currency. Their reasons vary, ranging from a fear of carrying currency to a false sense of security, fed by their egos, that they are smart enough not to leave an "audit trail" when utilizing banking services. The day may be fast approaching when the perpetrators of financial crimes have no alternative to the use of financial institutions, since the amount of currency available in the United States today, in denominations of more than $100.00, is very limited. The supply will ultimately run dry as the Federal Reserve Banks no longer circulate bills in denominations over $100.00.

The criminal investigator, therefore, must sharpen his investigative skills in the use of "paper trail" techniques in order to keep pace with violators who are using these techniques to conceal their profits from white-collar crime violations.

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APPENDIX

TRACING FUNDS IN FOREIGN BANK ACCOUNTS

Until recently there were very few non-federal investigations which involved foreign transactions. Now, however, with state and local investigators involved in more sophisticated crimes and with even more common international transactions, investigators should be familiar with foreign country services.

A. Foreign Country Services

Criminal investigators should be alert to the possibility that a target may have used the services of this department of a bank. Both domestic and foreign letters of credit are usually issued in this department.

Record-keeping regulations issued by the American Bankers Association pertinent to the movement of funds between the United States and foreign countries are stringent, and are summarized below.

Each bank must retain for five years the original record or a copy of the following:

1.

2.

3.

4.

Each item, including checks, drafts or transfers
of credit in excess of $10,000.00, remitted or
transferred outside the United States;

Each remittance or transfer of funds, or of currency, other monetary instruments, checks, investment securities, or credit of more than $10,000.00 outside the United States;

Each check or draft of more than $10,000.00 drawn
on or issued by a foreign bank which the domestic
bank has paid or presented to a non-bank drawee
for payment;

Each item of more than $10,000.00 received directly by letter, cable or other means from outside the United States, including checks, drafts, or transfers of credits.

5.

B.

Each receipt of currency, other monetary instruments, checks, or investment securities, and each transfer of funds or credit, of more than $10,000.00 received on any one occasion, directly, and not through a domestic financial institution, from a bank, broker or dealer in foreign exchange outside the United States.

Currency Transaction Reporting Requirements

Deposits, withdrawals, exchanges of currency, or transfers of currency, as well as other payments valued at more than $10,000.00 in any transaction, must be reported by all financial institutions to the United States Treasury Department on their Form No. 4789, within 45 days of the date of a transaction. Form 4789 requires that the party to the transaction

be identified by his social security number, employer identification number, or by one of his bank account numbers. If the party to the transaction is not a customer of the bank, his driver's license number or other appropriate document is normally acceptable to the Treasury Department.

C. Transportation of Currency or Monetary Instruments Persons who physically take or send more than $5,000.00 in the aggregate of currency or other monetary instruments on any one occasion outside the United States must report the fact at the time, by filing Form 4790 with the United States Commissioner of Customs.

Persons receiving currency or other monetary instruments worth more than $5,000.00 on any one occasion from outside the United States must file Form 4790 within 30 days with the Customs Officer in Charge at any point of entry or by mail to the United States Commissioner of Customs.

Monetary instruments are defined as coin or currency of any country, traveler's checks, money orders, investment securities in bearer form or otherwise in such form that title passes upon delivery and negotiable instruments in bearer form or otherwise in such form that title passes on delivery. Monetary instruments do not include bank checks made payable to the order of a named person which have not been endorsed, or which bear restrictive endorsements.

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