Spitzer Was Not Done In By The Patriot Act

http://corner.nationalreview.com/post/?q=ZjMxNTI4YzY3N2Q4ZjljMzMwYWFkOWMxMDE1ZGY2NGU= ^ | Andrew McCarthy

[ventanax5]

This is the latest canard making the rounds — I heard a radio talk-show guy say it this morning, and one of the endless stream of former federal prosecutors suggested it on MSNBC last night (I had switched channels following Jeffrey Toobin's botched explanation of the money-laundering offense known as "structuring" — the cash transaction amount that triggers the reporting requirement is $10K, not, as Toobin stated, $5K.)

Currency transaction reporting requirements were enacted in the Bank Secrecy Act of 1970, and money laundering was made a crime in overhaul of the federal narcotics laws that took place in 1986. Believe it or not, Karl Rove did not diabolically dream these provisions up to trap unwary Democrats, nor are they part of George W. Bush's post-9/11 Politics of Fear.

Long before we had an international terrorism problem, these laws were developed to target domestic criminal enterprises (especially organized crime and drug trafficking). The biggest problem many of these syndicates have is hiding the mountains of cash they generate — unexplained wealth being among the best indicators of criminal activity, especially when it comes to the highest-ranking, most insulated crooks. To the extent these laws (and the Treasury Department's implementing regulations) have been beefed up significantly, a lot of that happened during the Clinton administration. (This Treasury Department publication lays out much of the history.)

[TCats]

I think he was fingered by any number of very bitter, powerful enemies he made on Wall St. Whoever else gets outed in this thing is just so much, unlucky collateral damage.

[fkabuckeyesrule]

****I had switched channels following Jeffrey Toobin's botched explanation of the money-laundering offense known as "structuring" — the cash transaction amount that triggers the reporting requirement is $10K, not, as Toobin stated, $5K.)****

That's pretty bad that Tobin does not know that. Anyone who works for a bank or financial institution has to take a test every few years where they need to know what the Patriot Act requires. And everyone knows (and I do mean EVERYONE) that the figure is 10K not 5K.

[Wiggins]

As far as I'm concerned Spitzer being done in is a patriot act. Good riddance to trash.

[Proud_USA_Republican]

When someone calls a bank asking that their name be removed from wire transfers, that will get a SAR created.
This has nothing to do with the patriot act or bankers looking to get back at Spitzer. It was that moronic act got him busted.

[Beowulf9]

Ohmygosh! They need to raise taxes so they can funnel off some money for him to put on account!

[TomGuy]

the cash transaction amount that triggers the reporting requirement is $10K, not, as Toobin stated, $5K.

IIRC, the old figure was $10k, but under the Patriot Act, the figure was revised to $5k.

Anti-Money Laundering Initiatives Under the USA Patriot Act

Proposed Rule for Broker Dealers Broader than those for Banks. For reasons that have not been disclosed, the proposed rule for broker-dealers does not exactly parallel the existing rule for depository institutions and, in many ways, the proposed rule includes reporting requirements that are broader than the requirements for banks. For example, under the existing rules, a depository institution must submit a SAR for any activity that involves at least $5,000 and: (i) any known or suspected violation of federal law; (ii) a suspicious transaction related to money laundering; or (iii) a violation of the BSA. Under the proposed rule applicable to broker-dealers, the reporting requirement is triggered by "any suspicious transaction relevant to a possible violation of law or regulation."17 Thus, a broker-dealer would be required to report a possible violation of state law, whereas a depository institution would not have such a requirement, assuming the violation did not involve suspicious activity relating to money laundering or a violation of the BSA. There are other differences between the two reporting requirements and these inconsistencies have been identified during the comment period for the proposed rule, which ended March 1, 2002.18 The final regulations are due no later than July 7, 2002 and will take effect 180 days after publication.

[Hardastarboard]

When someone calls a bank asking that their name be removed from wire transfers

I'm quite sure Spitler didn't do that. I didn't see this on CeeBS News tonight. It must not have happened. /sarc

[Proud_USA_Republican]

Spitzer last year had wanted to wire transfer more than $10,000 from his branch to what turned out to be the front for the prostitution ring, QAT Consulting Group, which also uses a number of other names, in New Jersey, the sources said.

But Spitzer had the money broken down into several smaller amounts of under $10,000 each, apparently to avoid getting around federal regulations requiring the reporting of the transfer of $10,000 or more, the sources said. The regulations are aimed at helping spot possible illegal business activities, such as frauds or drug deals.

Apparently, having second thoughts about even sending the total amount in this manner because it still might reveal what he was doing, Spitzer then asked that the bank to take his name off the wires, the sources said.

Bank officials declined, however, saying that it was improper to do so and in any event, it was too late to do so, because the money already had been sent, the sources said.

The bank then, as is required by law, filed an SAR, or Suspicious Activity Report, with the Internal Revenue Service, reporting the transfer of the money that exceeded $10,000, but had been broken down into smaller amounts, the sources said.

http://www.newsday.com/news/local/state/ny-stspitzerbank0312,0,4637246.story

[reformed_dem]

No. A CTR is required for cash in or out over $10,000. That has not changed. If there are frequent large cash transactions below $10,000, then an SAR is filed.

[HIDEK6]

I heard that Haliburton had something to do with it.

[rabscuttle385]

IIRC, the old figure was $10k, but under the Patriot Act, the figure was revised to $5k.

Suspicious Activity Reports (SARs) and Currency Transaction Reports (CTRs) are different. A CTR must be filed if total cash transactions go over $10,000 in a single business day. There are also forms to be filed for cash purchases of negotiable instruments such as official checks and money orders. SAR filings can be triggered by any suspicious activity.

In Mr. Spitzer's case, calling to ask that his name be removed from wire transfers warranted filing a SAR. That, and the folks on Wall Street that he pissed off were probably the same folks with whom he was banking. Basically, it's Spitzmas in March.

[rabscuttle385]

Apparently, having second thoughts about even sending the total amount in this manner because it still might reveal what he was doing, Spitzer then asked that the bank to take his name off the wires, the sources said.

Suspicious activity. And, it triggered a report.

[prairiebreeze]

According to the linked report, Spitzer foolishly made a request to his bank that his name be taken off some of his wire transfers. He was concerned they might expose what he was doing. His bank appropriately declined and then filed a Suspicious Activity Report opening the investigation.

LINK

Originally it was thought that Spitz was being blackmailed or his account somehow victimized. I doubt the bank or the IRS had any idea initially what this would lead to.

While I'm certain Spitz's enemies are pleased to witness his comeuppance, I don't think he was "fingered".