Mises Wire

Dennis Hastert Sentenced to 15 Months for Non-Crime of Improper Cash Withdrawals

Former U.S. Speaker of the House Dennis Hastert probably deserves to be in prison more than many people who are already there. But the way he’s going to get there spells bad news for ordinary, peaceful Americans. 

Today, Hastert was sentenced to 15 months in prison for the made-up “crime” of structuring, which is a situation in which a person withdraws cash from a bank in amounts designed to not trigger mandatory reporting on the withdrawals to federal agents. 

In other words, it’s a crime to comply with the law in America. If you change your activities to adhere to the letter of the law, that’s a crime. 

The only way you would know this, however, is to read today’s articles on Hastert’s sentencing very, very carefully. 

After all, most of the media coverage gives the impression that Hastert is being sentenced for alleged crimes of sexual abuse. I say ”alleged” because, thanks to the statute of limitations in Illinois, Hastert can’t be tried for the real crimes of sexual abuse. 

But real crimes such as preying on underaged teenagers should not be confused with the non-crime of withdrawing cash “improperly” from a bank account. Not even the judge in this case, who kept referring to the sexual abuse accusations, is well-informed enough to make the distinction. Or, more probably, the judge was simply grandstanding from the bench. 

The Hastert case makes for good, lurid press because of the sexual abuse angle. But, legally speaking, Hastert was on trial for “structuring,” not sexual abuse. 

These same financial laws are applied to ordinary people who have never behaved improperly toward a young person at all. They’re applied to small business owners who simply wish to mind their own business, but would rather not have the federal government sniffing around all their financial affairs. These federal laws are used to turn bankers into spies for the federal government. 

As Jeff Deist noted in relation to the Hastert case in 2015:

Now Hastert has been charged with two noncrimes: allegedly “structuring” over $1 million in cash withdrawals from several banks (i.e. taking out less than $10,000 repeatedly); and allegedly lying to FBI agents about what he had done with the money. 

First and foremost, withdrawing one’s own cash from a bank is none of fedgov’s business. But of course the feds hate privacy almost as much as they hate not taxing every human transaction. So the Bank Secrecy Act of 1970, sold to the public as a tool to fight money laundering and drug trafficking (for the children!), was born. And along with it came the odious requirement for financial institutions to report any cash withdrawals over $10,000. 

Keep in mind that the original $10,000 reporting rule has never been adjusted for inflation. In 1970, $10,000 could buy a new car, appliances, expensive jewelry, etc. Just keeping pace with official BLS CPI would require raising the reporting amount to nearly $61,000 today! So even if one accepts the premises of the Bank Secrecy Act, individuals should be allowed to withdraw, carry, and conduct business with $60,000 in cash without any suspicion.

Also note that the “structuring” prohibition was added by one of the many amendments to the original Act. Cash withdrawals of $10,000 or more from a bank must be reported, but withdrawals of less than $10,000 may also need to be reported... And the person making this Junior G-Man decision may be a 20 year old bank teller!

Hastert may very well be a sexual predator, and if that’s so, he should be punished for that very-real crime. If there’s a problem with the statute of limitations, then that should be addressed. What has happened in the Hastert case, though, is something else entirely. The federal government has used a federal non-crime as a back-up plan for prosecuting a man who hasn’t been convicted of the actual crime for which he’s being targeted. 

The existence of these federal non-crimes presents a very dangerous reality for ordinary people. If true crimes can’t be proven in a court of law, then the federal government, if properly motivated, will simply reach into its bag of tricks and find some sort of federal non-crime that can be used to punish the accused instead. Such “offenses” could be structuring, or “lying to federal agents” (as in the case of Martha Stewart) or use of the RICO act to convict people for unrelated financial acts that involve no criminal intent at all.  

Even ignoring any sex crimes, Dennis Hastert spent much of his life as a despicable politico, supporting and funding crimes against ordinary people, either in the form of war crimes, domestic spying, or through his support of the federal machine that now is taking him down. He’ll be missed by few. 

In this, the feds have chosen their case well. Given the conflation of real sex crime with financial non-crimes, (and Hastert’s contemptible public legacy) anyone who speaks out against harsh sentencing for fake federal crimes wil be labeled an apologist for Hastert. But, as H.L. Mencken once noted: “The trouble with fighting for human freedom is that one spends most of one’s time defending scoundrels. For it is against scoundrels that oppressive laws are first aimed, and oppression must be stopped at the beginning if it is to be stopped at all.”

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