Federal law requires institutions to file reports with the Treasure whenever they undertake cash transactions exceeding $10,000. It is illegal to break up this sum to avoid reporting requirements. Defendant ran up casino debt of roughly $160,000 and attempted to pay $100,000 of it a week later in cash. A casino official informed Defendant of his reporting obligation, but added that the casino would accept cashier’s check, which held no reporting requirement as a payment method. Defendant claims he did not know of this requirement and the government must prove he knew that he was deliberating breaking up the sum to avoid his legal reporting obligation.
Convicted at trial court level for willfully avoiding his obligation. Appellate court affirmed.
Whether a defendant’s purpose to circumvent a bank’s reporting obligation is sufficient to convict for “willfully violating” the antistructuring provision.
Holding and Rule
“To establish that a defendant ‘willfully violated’ the antistructuring law, the Government must prove that the defendant acted with knowledge that his conduct was unlawful.” Defendant must have knowledge of his legal requirement and a specific intent to violate this requirement/commit the crime. Plaintiff (United States) erroneously alleges that the act of breaking up the summed payment demonstrates a purpose of evading the law, because restructuring/breaking up of payment itself is not an ordinary undertaking. However, there are many lawful purposes for breaking up payment (gift tax limit, reduction of tax burden, etc); and therefore the act itself cannot on its face demonstrate specific intent to violate the law.
Ignorance of the law or mistake is generally is not a defense to prosecution. To require that the prosecution put forth proof that the defendant had actual knowledge that his conduct was illegal presents a major loophole to conviction and contravenes centuries of American jurisprudence. A defendant can avoid prosecution by simply showing a legitimate business purpose in breaking up the transaction. Here, defendant was made aware of the of the illegality of breaking up the transaction by bank tellers and casino workers. The purpose of his conduct was to blatantly avoid the law.