NCJ Number
56584
Date Published
1979
Length
46 pages
Annotation
A GENERAL ACCOUNTING OFFICE (GAO) STUDY OF THE USE OF CURRENCY TRANSACTION, FOREIGN TRUST, AND FOREIGN BANK ACCOUNT REPORTS TO FACILITATE INVESTIGATIONS OF DRUG TRAFFICKING AND TAX EVASION IS DOCUMENTED.
Abstract
CONDUCTED AT THE REQUEST OF THE SUBCOMMITTEE ON OVERSIGHT OF THE HOUSE COMMITTEE ON WAYS AND MEANS, THE STUDY INVOLVED AN EXAMINATION OF THE POLICIES AND PROCEDURES FOLLOWED BY THE IRS AND THE TREASURY DEPARTMENT IN PROCESSING AND USING THREE TYPES OF REPORTS: (1) REPORTS THAT MUST BE FILED BY BANKS ON ALL CURRENCY TRANSACTIONS OF $10,000 OR MORE, AND BY INDIVIDUALS AND CERTAIN LEGAL ENTITIES ON IMPORTS AND EXPORTS OF MORE THAN $5,000 IN CURRENCY; (2) REPORTS THAT MUST BE FILED BY TAXPAYERS WHO CREATE OR TRANSFER FUNDS TO A FOREIGN TRUST; AND (3) REPORTS REQUIRED OF TAXPAYERS WITH FOREIGN BANK ACCOUNTS. THE GAO RECOMMENDS THAT THE CURRENCY REPORTS BE PROCESSED CENTRALLY IN THE TREASURY DEPARTMENT'S LAW ENFORCEMENT COMMUNICATIONS SYSTEM, AND THAT THE IRS MAKE MORE EFFECTIVE USE OF THAT SYSTEM IN ITS TAX FRAUD INVESTIGATIONS. THE IRS HAS NO PROGRAM FOR ENFORCING COMPLIANCE WITH FOREIGN TRUST FILING REQUIREMENTS OR FOR EVALUATING AND USING FOREIGN TRUST REPORTS. THE IRS IS URGED EITHER TO RECTIFY THIS SITUATION OR ELIMINATE THE REPORTING REQUIREMENT. THE TREASURY DEPARTMENT HAS TAKEN STEPS TO ENHANCE THE USE OF FOREIGN BANK ACCOUNT REPORTS (ENTERING THE DATA IN THE ENFORCEMENT COMMUNICATIONS SYSTEM, RESOLVING DISCLOSURE PROBLEMS, ESTABLISHING A REPORTS ANALYSIS UNIT). THE DEPARTMENT IS URGED TO MONITOR THE USE OF COMPUTERIZED FOREIGN BANK ACCOUNT DATA AND TO EXPLORE WAYS OF IMPROVING THE UTILITY OF THESE DATA. SUPPORTING DOCUMENTATION IS PROVIDED. (LKM)