I know money from drugs, robberies, stolen goods, etc is “dirty” but, how does anyone know it’s dirty? Why can’t you just spend your money?
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The bank secrecy act requires merchants to report cash transactions over $10k. So you can’t even buy a late model car with dirty money without the authorities being alerted.
You can – up to a point. You can simply pay cash for as much as possible, but as soon as you start to pay for things costing amounts people don’t normally pay in cash, the jigs going to be up fairly quickly. if your incomes 100% dirty, that means you are going to be driving a very cheap car, living in a cheap apartment, holidays are going to be in home country etc.
This is in part why there are a lot of low level criminals in their late teens and early twenties – the sort of stuff most people want to buy at that age is fairly easy to buy with dirty money, that pimpin $350 gold chain or sovereign ring you’ve been thinking was way above your price range for the last few years, or that $150 bottle of champagne to impress a girl. Once you are at the stage of life where you want to buy the real deal $15k gold chain, and the girls only gonna be impressed with a trip to the Bahamas in a luxury hotel where they take your credit card on entry and charge everything to that, it’s not so attractive – you have to go straight or go big and clean the cash.
Al Capone was the mob boss of all of Chicago at one time. Over time, he got all of the police on his payroll. They took the money or they lost their jobs. He provided booze, gambling and prostitution.
Every time one of the authorities would try to bust him, he would always be one step ahead of them due to informants and a system of tunnels underneath the city. The way that he finally got arrested was by federal IRS agents, who were able to prove he was spending WAY more money than he had documentation of how much he was earning. This meant that he had secret income that he had not paid taxes on.
There is some slop in the system, so you don’t have to account for every dollar, but…getting caught with $10,000 in cash and no documentation triggers a red flag with the IRS. They may not investigate, but…maybe they will.
No idea about abroad but in the UK you have to explain in boring levels of detail to a bank why it is you need to take more than £10k out in cash and the limit is ~£20k. They have to take photos, get signatures on ‘non duress’ agreements etc. In order then, to buy a car for £100k cash, you would have needed to lie to your Bank five times. Which for HMRC to find out is a simple phone call. Making any purchase of anything of £10k impossible in cash without leaving a snail trail, the absence of which is the easiest thing in the world to track down.
The IRS. They don’t care how you got the money, but they get their share one way or another
Large purchases and deposits are reported and tracked by the government. So, you could use dirty money to buy dinner at a restaurant in cash, but you couldn’t use it to pay rent, buy a car/house or deposit it into a bank.
If it’s a smallish amount of dirty money, just spending it in bits in cash might be an option, but if it’s your primary source of income, you’ll have a hard time actually *paying your bills* with it.
Hi!
There are two issues.
* Does my high amount of cash income from an unknown source get me in trouble with the TAX people?
* Does my high amount of cash income from an unknown source make me a person of interest to a police investigation?
Don’t think of it as money. Think of it as evidence you were involved w/ a crime.
Let’s say you stole cash from your friend. You’re out drinking and pay w/ some of that cash, and your friend sees it and says “hey that looks like my $20. It had a mustache on Jackson just like the one you’re paying with.” Now you’re under investigation. It’s sorta the same as that, but with the police, or FBI. The IRS says it does not care about illegal activity as long as all income is reported. There’s even a spot for it on your taxes. You can believe what you want about if they secretly snitch on you, but the official stance is they do not.
You absolutely can, but there is only so many pizzas you can eat in a day. And people still need to pay for cars, mortgages, health insurance and so on
Because you want to spend it. Spending lots of money by its very nature makes it known.
If you don’t want people sniffing around asking about where it came from (like the tax man) then you need a plausible explanation.
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