Luxury Stores Help Customers Launder Money, U.S. Agents Find
Undercover agents said Thursday that a nine-city investigation shows it is ridiculously easy to launder money by buying cars, jewelry and other luxuries for cash from stores that ignore reporting laws.
“I think this is the most shocking testimony I’ve heard in my 12 years in the U.S. Congress,” Rep. Beryl Anthony Jr. (D-Ark.) said at a House hearing after congressional investigators had delivered their report.
Real estate salesmen, rug sellers and other dealers in high-cost items proved willing to help them get around a law requiring a report to the Internal Revenue Service of any cash transaction over $10,000, investigators said.
They told a House Ways and Means panel that they posed as purchasers with cash and a passion for anonymity, arranging to buy items worth $4.2 million from 79 businesses in nine states over five weeks.
Agents Barney Gomez and Leigh Jackson said they always insisted they did not want their names sent to the IRS.
“The overall results of our investigation were quite astonishing and indicated to us a blatant and knowing disregard for the filing requirements,” Gomez said at the oversight subcommittee hearing.
“Representatives from 76 of the 79 businesses we visited expressed both a willingness to accept cash in excess of $10,000 for the sale of an item and not report it to the IRS and to register the sale under a false name, a company name or as a ‘cash sale,’ ” he said.
Under questioning by subcommittee Chairman J. J. Pickle (D-Tex.), Gomez said that just three reports of cash transactions in excess of $10,000 have been filed thus far this year in the cocaine-plagued District of Columbia. By comparison, 200 have been filed in Virginia and 209 in Maryland.
“The results of this investigation are appalling,” Pickle said.
“We have a whole category of people who are willing to take cash for almost anything,” Rep. Byron L. Dorgan (D-N.D.) said. “This is shameful.”
During the investigation, they visited businesses in Atlanta, Boston, Denver, Detroit, Indianapolis, Minneapolis, New York, San Antonio and the nation’s capital.
