SACRAMENTO, CA - A federal judge has ordered the IRS to seize up to $175,000 from the owners of a neighborhood market who investigators believe deliberately tried to hide large cash deposits.
According to a federal seizure warrant, the owners of Pothong Market on Norwood Avenue made a series of cash deposits between April and July just under $10,000 each, sometimes just days apart, in an apparent attempt to avoid mandatory currency transaction reports.
The practice is formally known as structuring.
"It's called 'Smurfing' in the (financial) industry because they're putting it in shorter and smaller levels," said attorney Mark Reichel, who has represented others accused of structuring.
Although the series of regular cash deposits did not trigger currency transaction reports, the pattern apparently prompted SAFE Credit Union to file voluntary suspicious activity reports.
The suspicious deposits listed in the seizure warrant total $175,442.
According to the warrant, market co-owner Lianne Kanthathin made a deposit of $10,038 at SAFE on June 1, but asked for $100 cash back as the teller counted the deposit to avoid exceeding the $10,000 threshold.
Kanthathin, along with her brother and business partner Bounmee Kanthathin, also made structured deposits into their personal SAFE accounts, according to the seizure warrant.
An investigator assigned to the IRS Criminal Division said structured deposits began immediately after the Kanthathins opened their SAFE accounts in 2010.
In the three months between April 1 and June 30, the market's bank deposits exceeded the reported gross receipts by $85,000, according to the warrant.
When approached at the market, Bounmee Kanthathin told News10 he and his sister were not trying to avoid paying taxes.
"I made a mistake," he said.
by George Warren, GWarren@news10.net