I've been following this so-called scandal about the IRS BOLO lists. Now, don't get me wrong- if the White House had anything to do with directing the IRS to investigate anyone that would be wrong. I'm just not so sure that they did.
I'm just shocked that more private sector people have not come out to say "this is not a surprise to me". To me, I had not clue that revealing this would be "whistle-blowing" since my own career suggested this was exactly what happens at the IRS.
Briefly, AML specialists operate under the Bank Secrecy Act (BSA) which was largely started in an effort to fight organized crime. If you remember, Al Capone went to jail largely for tax evasion - not for the violent crimes. The United States figured it was a swell idea to make it a regulation that banks needed to look out for signs of tax evasion. This BSA program exploded right after 911 when additional regulations for Know Your Customer and anti-terrorism funding regulations meant that banks everywhere suddenly beefed up their BSA/AML programs to a huge degree. This program looks for transactions that could be considered an evasion of tax reporting or terrorist financing and then writes SARs or Suspicious Activity Reports to the government. The government basically uses these as precedent for a warrant anytime they want, under the concept that a "lay person" considers the activity suspicious enough to report it to the government is a very, very powerful statement to make before a grand jury. No secrets here folks, read it all here and other government websites.
Except, that I'm afraid, I don't personally consider these people to be very "lay" in that they are actually pretty highly trained, often by law enforcement, to target very specific individuals depending on the particular political agenda at the time. In the Bush era whilst working for a bank in the AML program, we were given a day training by FBI agents on how to look for the evidence of the use of Hawala. Which, although discouraged in the US, is still very much legal. Later, under the Obama era, we were advised by auditors from a different agency that there was a 'rash' of people who were coverting their assets to gold, and putting the gold in safety deposits boxes. (Also perfectly legal itself) We were told we should report these people, and they were often associated with the Tea Party.
We would only have to assume, therefore, that there is a sort of feedback loop occurring here. The AML divisions of banks attend seminars by government agencies that educate them on the latest money laundering trends to look out for, the banks increasingly file on those trends which those agencies then use to justify the trend itself. If we were being told that certain behavior or association with political or religious parties often correlated with tax evasion, we reported more of that behavior as possible evidence of tax evasion. So of course the IRS must have a BOLO. And yes, these do go to the IRS among other agencies.
Before anyone freaks out and thinks this is a larger conspiracy at play- you know what the two things have in common? They are means of taking currency out of the banking system in a fashion that makes it easy to cheat on your taxes. This is what this entire BOLO list is about. The key words and groups they picked where ones they anticipated or have seen where historically submitted some questionable documentation. Medical Marijuana? There is a a huge mess around the tax situation for those organizations anyway; many of them having to turn to the guise of non-profit agencies that take "donations" just to confirm to a sensible code. Additionally, many normal business expenses cannot be written off, so I'm sure they get a lot of honest mistakes. Some people are just... gullible, or guilty of a urban legend. I think the Tea Party had a pretty good urban legend going about "legal" ways to avoid paying takes, and it got them attention.
Does this excuse the behavior? Is any of the above ethical or justified? That's not what this article is about. That is a much bigger question for other articles. I simply purpose that I think there are many, many people who were not at all surprised by these announcements in the private sector banking. I'm surprised I have not heard more from them.