IRS Inspects Viet-Owned Jewelry Stores : Routine Probe to Check on Reporting of Big Cash Transactions

The Internal Revenue Service has launched what it calls a routine inspection of the tax records of numerous Vietnamese-owned jewelry stores in the “Little Saigon” area of central Orange County.

For the second day Friday, tax officers were checking stores located primarily along Bolsa Avenue in Westminster to determine if the businessmen were properly reporting large cash transactions, according to IRS spokeswoman Nancy Dixon.

“It’s basically what we consider a routine check for compliance with the law that all transactions involving $10,000 or more in cash be reported,” Dixon said. “While it’s not something we do every single day, it certainly is not something new. We have done many of these in the past.”

New Law Aimed at Drugs

In the past, Dixon said, only institutions such as banks had been required to report large cash transactions. However, under a new law aimed at curtailing money-laundering by drug dealers, all businesses must report to the IRS.

Dixon said the inspections usually focus on a particular type of business or industry where “indications are that proper returns possibly are not being filed.”

She called the current inspections, which are expected to take several days, “unique” in that “the people we’re identifying as handling these types of transactions are of the same ethnic group in the same type of business” in a relatively small geographic area.

The jewelry stores do a brisk business because many of the former refugees prefer gold to paper currency or to investing their assets in stocks and bonds, according to Yen Do, editor of a Vietnamese newspaper in Westminster.

“To many people, gold is something they can use anywhere at anytime,” Do said. “Stocks and bonds are too sophisticated for many of them.”

‘Have the Right to Say No’

Dixon said the tax officers ask to see a business’s records to verify that the proper tax information has been filed with the IRS.

“Of course, they have the right to say no, and if we really want the records, then we have to go through a court action,” Dixon said.

Businessmen who have not filed the proper report, Dixon said, are given the opportunity to do so at the time of the inspections. Violators also can be fined, she said.

Dixon said Friday that she did not know if the officers had uncovered any violations during the two days of inspections.