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"Wealthy Chinese who want to get around limits on moving money out of China “buy” the $350,000 from Li’s couriers in the U.S. They often use the U.S. dollars to

"Wealthy Chinese who want to get around limits on moving money out of China “buy” the $350,000 from Li’s couriers in the U.S. They often use the U.S. dollars to buy real estate or pay for U.S. college tuition. " You can buy real estate in the US in cash no questions asked? Is that true?

powersnail 4y ago
As someone who has never bought real estate, why not? Is cash not universally accepted as a currency?
- smackeyacky 4y ago
  It would raise a lot of red flags with agencies[0] looking to crack down on using the proceeds of crime. That doesn't mean it can't be done. [0]https://www.fincen.gov/what-we-do https://www.fincen.gov/what-we-do
- markdown 4y ago
  In America, if you have unexplained wealth, the government can sue your notes and coins.
- mavili 4y ago
  It's not about the cash per se, it's big brother wanting to know how you got the money in the first place. If you can show it's all legal and taxes paid then no problem cash is fine. But of course as soon as you mention cash, eyebrows are raised "why would someone want to keep that much cash and not want to put it in a bank if they are all clean?" Big brother wanting its lion share in everything you earn is the crux of it.
  - mutt2016 4y ago
    Federal tax. Provincial tax. School tax. Sales tax. Federal sales tax. Tax on fuel. Tax on alcohol. Tax on tax on tax. Well... At least the infrastructure isn't falling apart and crime isn't rampant...in rich neighbourhoods.
  - novok 4y ago
    When your an immigrant and your money is from places with bad records, they can't really push too much beyond it, or tax you for money made out of the country where you were not a citizen or resident of the USA. Shitty undeveloped countries are essentially a laundry for cash in general. Hell even credit ratings don't cross borders.
alaskamiller 4y ago
Yes. Silicon Valley, Orange County, Seattle, Dallas, Vancouver Washington or Canada. EB5 visa is $550k minimum to buy a business in impacted investment areas designated by USA.
- gautamdivgi 4y ago
  Don’t you have to show you’ve employed Americans citizens or green card holders? Or is just showing some investment good enough? Either way - pretty sure it easy enough to fudge the employees too.
  - novok 4y ago
    Why fudge when you can just buy a mcdonalds as an investment and make clean money on top of it? Or real estate and hire the services of a property manager?
- kevin_thibedeau 4y ago
  Even better when the "impacted area" your visa is fixing is in midtown Manhattan and you solve the blight by building your own luxury pied-a-terre after moving Harlem 80 blocks south.
newsclues 4y ago
I’m guessing these transactions occur within the community. A local realtor/finance company works with these clients.
schainks 4y ago
Yes, agents do minimal due diligence on the origins of cash. As long as buyer and seller are happy to make a deal, agents get paid and everyone gets what they want. A friend of mine who is an interior designer in an affluent area has received calls from clients that go like this: 1. A Chinese couple showed up at their door with a suitcase of cash in the middle of the day offering to buy their house, on the spot. The cash value was about 2x the value of the home. 2. The client declined. They _just_ remodeled, why leave? 3. The Chinese couple gets upset, not understanding why paying 2x for a home on the spot isn't a sweet deal. They leave to go find someone else willing to take the cash to move out ASAP.
givemeethekeys 4y ago
Let's say you sell a house for $1MM on paper where in reality you've accepted 2MM more in cash. There's not much the government can do, but you now have 2MM in cash that you need to hide. The buyer knows you have 2MM, and who knows who they'll tell about it. Now, if you accepted cash for the full value of the house and deposited it in a bank, then yes, the bank reports it for you, and the IRS - if it is a priority - would look into it. The IRS got a massive funding boost recently. Let's see how they use the money in the next little while.
- foobarian 4y ago
  Say you deposit the money, let the IRS find out about it, but then just report it on the tax return and pay the taxes - what is the problem?
  - givemeethekeys 4y ago
    No problem with that. The reporting happens when you deposit the money. At that point the question is one of, "from whom did you get all this cash and how did they get it?"
    - Aperocky 4y ago
      > how did they get it? Well if I'm selling a house how am I supposed to know?
    - foobarian 4y ago
      Yes OK, but there is nothing illegal there is there? Just wondering what legal tools there are for the police/FBI to interfere. Maybe if they can prove collusion they can confiscate it? Or maybe it's enough to bog one down in trips "to the station" that require taking constant days off or legal fees that become a hassle.
      - novok 4y ago
        You get added to a suspects list, subject to more audits and investigated, which even if your legit is an unpleasant cost itself, and with the amount of things illegal in reality, could still bust you for something nobody cares about, like having some hunting animal bust from great grandpa or whatever.
conductr 4y ago
> A Form 8300 must be filed by any trade or business (including real estate) that receives more than $10,000 in cash in the course of a single transaction or two or more related transactions. It is not a SAR and is not used to report suspicious activity. Form 8300 is an information report that is required to be filed by any trade or business (such as a car or boat dealer) that receives in excess of $10,000 in cash in a single transaction. Therefore, if for any reason a real estate agent or broker receives more than $10,000 in cash from a buyer or seller in the course of a real estate transaction, the form must be filled out and filed, and can be found at http://www.irs.gov/pub/irs-pdf/f8300.pdf(link http://www.irs.gov/pub/irs-pdf/f8300.pdf(link is external). https://www.nar.realtor/money-laundering-and-terrorism-financing/anti-money-laundering-voluntary-guidelines-for-real-estate-professionals https://www.nar.realtor/money-laundering-and-terrorism-finan... This is also usually how drug dealers get busted after paying cash for a car. It goes to the IRS and then basically every federal agency has it (DEA, FBI, etc)
- heelix 4y ago
  Ah man. The dealerships do not appreciate a large bag of cash. I found a car that I wanted and got a cashiers check for it at my local bank. They wanted what I considered an outrageous amount of fees (like $8) to do it. So... I asked for cash. Nope - don't have that on hand... will take time, yada yada. At that point, it was the principal of the thing... and said fine, see you in a day or two. Eventually I got it - drove over to pick up the car, and the dealership freaked out. They took it. Filled out all sorts of extra forms. My Bride is correct - I am a dumbass. Won't do that again.
- Aperocky 4y ago
  I suspect the "cash" referred in the article are actually 2 distinct things. First being literal dollar bills and the second being bank account balance. When you buy a house using account balance no actual paper note is involved but it is referred to as "cash".
  - conductr 4y ago
    IRS considers many things beyond currency “cash.” See section 32 of the form where it has you quantify how much value of each of 6 financial instruments were received in the transaction. If you’re expecting a wire transfer being a loophole, the cash has to get into the bank where the funds exist and they are required reporters for AML/SAR.
deleted 4y ago
[deleted]
yieldcrv 4y ago
Yes, the real estate industry successfully lobbied for exceptions to the KYC/AML laws. Whether we're talking about the Bank Secrecy Act or the Patriot Act.

powersnail 4y ago

As someone who has never bought real estate, why not? Is cash not universally accepted as a currency?

smackeyacky 4y ago
It would raise a lot of red flags with agencies[0] looking to crack down on using the proceeds of crime. That doesn't mean it can't be done. [0]https://www.fincen.gov/what-we-do https://www.fincen.gov/what-we-do
markdown 4y ago
In America, if you have unexplained wealth, the government can sue your notes and coins.
mavili 4y ago
It's not about the cash per se, it's big brother wanting to know how you got the money in the first place. If you can show it's all legal and taxes paid then no problem cash is fine. But of course as soon as you mention cash, eyebrows are raised "why would someone want to keep that much cash and not want to put it in a bank if they are all clean?" Big brother wanting its lion share in everything you earn is the crux of it.
- mutt2016 4y ago
  Federal tax. Provincial tax. School tax. Sales tax. Federal sales tax. Tax on fuel. Tax on alcohol. Tax on tax on tax. Well... At least the infrastructure isn't falling apart and crime isn't rampant...in rich neighbourhoods.
- novok 4y ago
  When your an immigrant and your money is from places with bad records, they can't really push too much beyond it, or tax you for money made out of the country where you were not a citizen or resident of the USA. Shitty undeveloped countries are essentially a laundry for cash in general. Hell even credit ratings don't cross borders.

alaskamiller 4y ago

Yes. Silicon Valley, Orange County, Seattle, Dallas, Vancouver Washington or Canada. EB5 visa is $550k minimum to buy a business in impacted investment areas designated by USA.

gautamdivgi 4y ago
Don’t you have to show you’ve employed Americans citizens or green card holders? Or is just showing some investment good enough? Either way - pretty sure it easy enough to fudge the employees too.
- novok 4y ago
  Why fudge when you can just buy a mcdonalds as an investment and make clean money on top of it? Or real estate and hire the services of a property manager?
kevin_thibedeau 4y ago
Even better when the "impacted area" your visa is fixing is in midtown Manhattan and you solve the blight by building your own luxury pied-a-terre after moving Harlem 80 blocks south.

newsclues 4y ago

I’m guessing these transactions occur within the community. A local realtor/finance company works with these clients.

schainks 4y ago

Yes, agents do minimal due diligence on the origins of cash. As long as buyer and seller are happy to make a deal, agents get paid and everyone gets what they want. A friend of mine who is an interior designer in an affluent area has received calls from clients that go like this: 1. A Chinese couple showed up at their door with a suitcase of cash in the middle of the day offering to buy their house, on the spot. The cash value was about 2x the value of the home. 2. The client declined. They _just_ remodeled, why leave? 3. The Chinese couple gets upset, not understanding why paying 2x for a home on the spot isn't a sweet deal. They leave to go find someone else willing to take the cash to move out ASAP.

givemeethekeys 4y ago

Let's say you sell a house for $1MM on paper where in reality you've accepted 2MM more in cash. There's not much the government can do, but you now have 2MM in cash that you need to hide. The buyer knows you have 2MM, and who knows who they'll tell about it. Now, if you accepted cash for the full value of the house and deposited it in a bank, then yes, the bank reports it for you, and the IRS - if it is a priority - would look into it. The IRS got a massive funding boost recently. Let's see how they use the money in the next little while.

foobarian 4y ago
Say you deposit the money, let the IRS find out about it, but then just report it on the tax return and pay the taxes - what is the problem?
- givemeethekeys 4y ago
  No problem with that. The reporting happens when you deposit the money. At that point the question is one of, "from whom did you get all this cash and how did they get it?"
  - Aperocky 4y ago
    > how did they get it? Well if I'm selling a house how am I supposed to know?
  - foobarian 4y ago
    Yes OK, but there is nothing illegal there is there? Just wondering what legal tools there are for the police/FBI to interfere. Maybe if they can prove collusion they can confiscate it? Or maybe it's enough to bog one down in trips "to the station" that require taking constant days off or legal fees that become a hassle.
    - novok 4y ago
      You get added to a suspects list, subject to more audits and investigated, which even if your legit is an unpleasant cost itself, and with the amount of things illegal in reality, could still bust you for something nobody cares about, like having some hunting animal bust from great grandpa or whatever.

conductr 4y ago

> A Form 8300 must be filed by any trade or business (including real estate) that receives more than $10,000 in cash in the course of a single transaction or two or more related transactions. It is not a SAR and is not used to report suspicious activity. Form 8300 is an information report that is required to be filed by any trade or business (such as a car or boat dealer) that receives in excess of $10,000 in cash in a single transaction. Therefore, if for any reason a real estate agent or broker receives more than $10,000 in cash from a buyer or seller in the course of a real estate transaction, the form must be filled out and filed, and can be found at http://www.irs.gov/pub/irs-pdf/f8300.pdf(link http://www.irs.gov/pub/irs-pdf/f8300.pdf(link is external). https://www.nar.realtor/money-laundering-and-terrorism-financing/anti-money-laundering-voluntary-guidelines-for-real-estate-professionals https://www.nar.realtor/money-laundering-and-terrorism-finan... This is also usually how drug dealers get busted after paying cash for a car. It goes to the IRS and then basically every federal agency has it (DEA, FBI, etc)

heelix 4y ago
Ah man. The dealerships do not appreciate a large bag of cash. I found a car that I wanted and got a cashiers check for it at my local bank. They wanted what I considered an outrageous amount of fees (like $8) to do it. So... I asked for cash. Nope - don't have that on hand... will take time, yada yada. At that point, it was the principal of the thing... and said fine, see you in a day or two. Eventually I got it - drove over to pick up the car, and the dealership freaked out. They took it. Filled out all sorts of extra forms. My Bride is correct - I am a dumbass. Won't do that again.
Aperocky 4y ago
I suspect the "cash" referred in the article are actually 2 distinct things. First being literal dollar bills and the second being bank account balance. When you buy a house using account balance no actual paper note is involved but it is referred to as "cash".
- conductr 4y ago
  IRS considers many things beyond currency “cash.” See section 32 of the form where it has you quantify how much value of each of 6 financial instruments were received in the transaction. If you’re expecting a wire transfer being a loophole, the cash has to get into the bank where the funds exist and they are required reporters for AML/SAR.

deleted 4y ago

[deleted]

yieldcrv 4y ago

Yes, the real estate industry successfully lobbied for exceptions to the KYC/AML laws. Whether we're talking about the Bank Secrecy Act or the Patriot Act.