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War on drugs
US prosecutors seeking forfeiture of car dealership
in which drug money was accepted for the sale of vehicles.
The fifth count says that Kaufmann attempted to sell undercover officers a Porsche, after the officers told him they intended to pay for the vehicle with the proceeds of an unspecified illegal activity.
The case is believed to be the first of its kind here. As part of the war on drugs, businesses are sup posed to report all cash transac tions of more than $10,000 to the Internal Revenue Service.
It also is illegal to structure cash payments in smaller chunks to avoid the reporting retirements.
Kaufmann and Jim entered not guilty pleas late Thursday before fedCeral Magistrate Aaron E. Goodstein. Antzoulatos declined to enter a plea." and Goodstein entered a not guilty: plea on his behalf.
Goodstein set bond at $50,000 each for Kaufmann and Antzoulatos. Jim was released on a signature bond.
Kaufmann's cars, which often included, Rolls-Royces, Excalibers, Mercedes-Benzes and BMWs, carried price tags as high as $100,000. He also exported many cars to Japan, the Philippines, Australia, Switzer land, France and England."
3 Some of his foreign buyers travel to his dealership to Inspect the cars.
In an interview last year with a Milwaukee Sentinel reporter, Kaufmann said, "I had a guy who bought 'a'$70,000 car and I put him into a " $69 room and he said, "Isn't there anything less expensive? So I put him in a cheaper room."
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MILWAUKEE SENTINEL Saturday, September 15, 1990 / PAGE 5, PART 1
Drug money isn't being socked away
Most ends up being spent at legitimate businesses, IRS agent says
By MIKE MULVEY
Legitimate businesses such as the
"Drug dealers make a lot of mon-
Ruffin said Harry C. Kaufmann,
action reporting requirements, he said.
In structured transactions, the
All businesses must file an 8300
"We're getting millions of CTRs
Ruffin said the amount of drug
dealing in Wisconsin would indicate
To avoid reporting requirements,
In 1988, Kaufmann allegedly sold
Kaufmann used some of the money
Ruffin said the IRS this week sent
He said similar mailings were
"We're not here to intimidate busi-
But Ruffin said business owners
"If it doesn't pass the smell test, give us a call," he said.
Mr. MURPHY. Moving right along, Mr. Shaw, another example of the New Jersey project identified an individual who had purchased more than $1 million worth of real estate. When contacted by agents, the individual claimed to have received the money from a deceased drug kingpin. The story later proved false and the individual is now under investigation.
Last year, an attorney deposited $80,000 in cash in his account. The bank alerted Criminal Investigation of the transaction and complained that the currency had a peculiar odor and appearance. The cash was analyzed by the U.S. Secret Service laboratory here in Washington. Although no narcotics residue was present, it was determined that the notes, all $10s and $20s, had been buried together.
The Detroit Computing Center was notified to perform a special search and to alert the San Diego office if the attorney filed a form 8300 within the 15-day period. The attorney did file the form but declared the amount as "over $10,000." Did not have a specific amount.
He also inscribed "attorney-client" privilege as to the remaining questions on the form. This and other similar situations are under civil litigation and summons enforcement by the Service.
The spouse of an executive under investigation for participation in a savings and loan fraud case is currently under investigation for structuring cash payments and deposits. The target was determined through a CTR filing.
Criminal Investigation has embarked on several compliance education campaigns around the country. In Dallas, a match was conducted of CTR and corresponding form 8300 filings by car dealerships. Letters were generated to specific car dealerships detailing the requirements of 60501 and highlighting discrepancies found in their CTR and 8300 filings.
These efforts generated mass delinquent form 8300 filings by Dallas area car dealers. The incoming forms were then compared with criminal indices and several known narcotics violators were revealed. Criminal Investigations are being pursued. Whether there should be more and whether more has to be done, I think has been pretty much agreed to here this morning.
These and other similar efforts around the country are beginning to impart the full responsibility of the laws on those who should be filing forms 8300. News publications of those prosecuted for violating the requirements, such as the two car dealerships mentioned earlier, the Milwaukee case I mentioned, are also having a positive compliance impact.
Businesses are starting to file suspicious transaction forms 8300. The 1990 version of the form 8300 includes a prominent block at the top to be checked if the business believes the transaction to be suspicious. The Detroit Computing Center has received 305 forms 8300 filed for amounts under $10,000 in the period January to July
The reality still exists that businesses will gamble and choose to accept a sale rather than refuse cash transactions that insist on anonymity. Even though the penalties were increased from a 1- to a 5-year misdemeanor, many businesses continue to risk the slim chance of criminal prosecution in favor of completing the sale.