Next time a politician proclaims law enforcement agencies need even more quasi-Constitutional powers to enable them to thwart the menace-of-the-moment, think about the guy who got caught recently trying to carry $70,000 in cash through an airport security checkpoint in Kansas City.
Despite the apparent absence of any evidence of actual wrongdoing, the man faces charges fashioned over the decades to deal with terrorists (interfering with airport security officers by leaving the checkpoint area rather than handing over the non-liquid, non-metallic book-like objects in his pants pockets). He faces charges concocted to deal with mobsters, Klansmen and drug lords (wire fraud and money laundering, based on federal agents' suspicions that the man's cash might have come from "mortgage fraud" activities).
White collar crime was the Justice Department's first big obsession under the Bush Administration until September 11 diverted some of its attention elsewhere.
Still, mortgage fraud represented an especially rich target for agents eager to throw the press off the scent of a president who was on first-name terms with former Enron CEO "Kenny Boy" Lay...a president with SEC skeletons in his own closet from his days in the oil business. Early in the Bush Administration, one of the most vibrant get-rich opportunities in the country was buying properties, fixing them up and renting or selling them for big returns on the investment.
Google "property flipping" a year or two ago, before federal agents began arresting virtually every business person in the nation who was buying and selling properties on a large scale, and the first 30 hits typically offered lessons on how to get rich flipping properties. Google flipping today, and most entries address the "epidemic of mortgage fraud" by "organized criminals" ripping off lenders in every state in every big city in the nation. Incidentally, most of the sites bemoaning the mortgage fraud scourge are run by folks offering their services to protect lenders from "mortgage hustlers."
Appropriately, the government named its mortgage fraud crusade Operation Quick Flip. The crusade runs on the notion loan defaults are tantamount to fraudulently prepared loan documents. It runs on the notion federal agents are better suited to determine fair market values than are professional property appraisers or willing buyers. It runs on the notion that only those involved in preparing loan documents are criminally liable when loans go bad --not lending companies that aggressively solicit loans in hot real estate markets and then fail to do even minimal underwriting on loan apps.
Anyway, the poor guy with pockets full of cash probably faces a virtual life sentence with all the federal charges stacked against him Fighting the government at trial costs upwards of a half-million dollars and the chances of winning are virtually nil.
The feds typically close their cases (96 to 97 percent of the time) with plea agreements. And federal prosecutors punish suspects who maintain their innocence by stacking addidtional charges or threatening to charge members of the suspect's family until the plea deal eventually seems irresistable....even to innocent suspects.
At trial, the feds nearly always win, especially in highly complicated cases like mortgage fraud. Maybe they win because some defendants are actual criminals (recruiting "straw buyers" to apply for loans....deliberatly misstating income or debts or equity in certain types of loans where those considerations are crucial in granting loans, etc.).In other cases, maybe they win because too many jurors simply can't imagine Ephraim Zimbalist Jr. coercing confessions from innocent people.
We don't hear much about our draconian federal justice system because it extorts silence from those it steamrollers into submission. Complaining about coerced confessions means failing to "accept responsibility for the crime" which means additional punishments can be imposed.
Personally, I can hardly wait for Martha Stewart's probation to end in September 2007 so I can hear what she has to say about the way the government manhandled her. Recall, if you will, that she was convicted and imprisoned for lying to bureaucrats who were investigating a crime she was never formally charged with committing And, no, she wasn't under oath during the questioning.
The guy at the KC airport must have known that in America today, possessing "large amounts of cash" gives cops the right to assume you've committed a crime, which gives them the right to confiscate the cash. I assume that's why he resisted handing over the cash to the checkpoint feds. What he may not have realized until a week into the episode was that the government views big profits on real estate transactions as crimes per se.
The poor bastards I pity most are the folks who had dealings with cash boy in the buying and selling of properties. In the feds' eyes, all of them are probably "co-conspirators" in the suspected mortgage fraud dealings.
The steady march toward a police state continues. The erosion of Constitutional rights and the subjugation of American citizens continue.
Anyway, the lesson is this: Whatever the feds say they need today to fight the devil (warrant-less wiretaps, secret searches of our homes, computers and library records, etc.) will be used tomorrow on the Real Estate agent who sold you your home, or the insurance man who lives next door, or the doctor who prescribed pain pills for your mother, or the physical therapist in your office building who made a mistake on a Medicare form, or your grown children who flip properties to supplement their incomes or maybe even on you.
