As the US government goes deeper into debt the IRS is getting more aggressive. Usually accountants acused of white collar crime are not held in level 4 prisons with murders and drug dealers. But hey if the IRS needs to squeeze to get a conviction or the TSA needs to justify the investment in airport secuirty then what are a few civil rights?
IRS Inc. March 14, 2012, Santiago, Chile: The current strategy of the IRS is to make the filing requirements for Americans living, investing, or holding assets overseas so complicated that it’s difficult to remain compliant. Misfile a form or missing a filing deadline, and the fines and penalties are severe, including prison time. Dear Live and Invest Overseas Reader, The writing has been on the wall for me since the TSA agent grabbed the Converse sneakers out of my then 2-year-old son's hands to put them through the X-ray machine as I tried to explain to my sobbing child that the big rude man wasn't stealing his favorite shoes. Most of us have TSA horror stories. And we've all heard the far more horrible stories of extraordinary rendition by the CIA in the name of the War on Terror...the stories of torture by U.S. soldiers at Abu Ghraib prison in Iraq...the stories last weekend about the 16 Afghan villagers killed by an Army Ranger... Those stories are sad and upsetting, but they're far away. Over the past six weeks or so, I've been watching as a story that's not nearly as horrific as 16 innocent people dying but that is much closer to home for me has been playing out. If you've been reading my wife's and my dispatches for any time, you've heard of Chris Rusch. He's a U.S. tax attorney and a friend who, until early February, was living in Panama City. Chris traveled to Colombia with us in January to participate in our Live and Invest in Medellin Conference. He never made it back to Panama, because the IRS had him picked up on the jetway at Tocumen International Airport in Panama City. Chris was rerouted to the States where he remains today, still in custody. He has been held now for more than six weeks without being arraigned and without being formally charged of a crime. For the first few weeks, we had some communication with Chris, who was allowed access to e-mail on a limited basis. He's since been relocated from the federal facility where he was initially held in Miami to a state prison in Arizona. Now the only information we receive is via Chris' father, who speaks with him by phone, as Chris no longer has e-mail capability. The prison where he's being held is a level 3 or 4 state penitentiary. I didn't know much about the U.S. prison system before this either, but I've learned that this is not the kind of place where white-collar offenders are typically held, not before arraignment, not ever. It seems Chris is being held among the general Arizona prison population, the murderers, the rapists, etc., until he "cooperates." I don't have any idea about what Chris did or didn't do, and my point here isn't to do with his guilt or innocence. My point is to do with due process...and big business. The incremental degradation of the rights and freedoms guaranteed to every American by the U.S. constitution has continued now for decades...in the name of, first, the War on Drugs, then, the War on Terror...and, now, I guess, the War on Tax Guys... Everything about the U.S. government today is a business, including, for example, airport security. The newest product for this business is those all-body scanners. The U.S. government conceived them, and now the U.S. government is consuming them. We poor travelers must succumb to them. We must give up any pretense of personal privacy and set aside any worry over personal health risks...or get left at the gate. All in the name of security. Meantime, only the most naïve believe these things actually work. Take a look here for the story of one traveler who set out to debunk the idea that these scanners are a reliable part of any security protocol once and for all. Airport security is an industry, a business...as is drug enforcement. Here I suggest a retooling. Rather than trying to make a business prohibiting the sale and the consumption of drugs altogether...make a business taxing said sale and consumption. As with cigarettes, as with alcohol. If someone wants to destroy his life over-using his drug of choice, Darwin's theory says let him. Meantime, the state could be generating good cash flow. Airport security...drug enforcement...and the IRS. This, too, is a business. The current revenue strategy is all about the penalties being imposed on those who misfile or who fail to file the proper forms. A guy who, say, inherits a bank account from his non-American uncle in Europe with US$50,000 in it and doesn't realize he is supposed to report that account to the IRS can get hit with a US$100,000 fine...and jail time. More forms. This is the current business agenda of the IRS. Institute more filing requirements and then invest in the staff to pay attention and chase down those who don't meet them. Generate press releases when you identify a big fish who hasn't filed or who hasn't complied in some other way and are able to squeeze a fine out of him. Increase awareness for your brand. Within hours of nabbing Chris on the jetway in Panama, the IRS had issued a mass press release boasting of its triumph. Tax attorney arrested in Panama. Big headline. Big business. Lief Simon from Living and Invest Overseas blog
