FLINT, Mich. — Earnest moralists lament Americans’ distrust of government. What really is regrettable is that government does much to earn distrust, as Terry Dehko, 70, and his daughter Sandy Thomas, 41, understand.
Terry, who came to Michigan from Iraq in 1970, soon did what immigrants often do: He went into business, buying Schott’s Supermarket in Fraser, Mich., where he still works six days a week. The IRS, a tentacle of a government that spent $3.5 trillion in 2013, tried to steal more than $35,000 from Terry and Sandy that year.
Sandy, a mother of four, has a master’s degree in urban planning but has worked in the store off and on since she was 12. She remembers, “They just walked into the store” and announced that they had emptied the store’s bank account. The IRS agents believed, or pretended to believe, that Terry and Sandy were or conceivably could be — which is sufficient for the IRS — conducting a criminal enterprise when not selling groceries.
What pattern of behavior supposedly aroused the suspicions of a federal government that is ignorant of how small businesses function? Terry and Sandy regularly make deposits of less than $10,000 in the bank across the street. Federal law, aimed primarily at money laundering by drug dealers, requires banks to report cash deposits of more than $10,000. It also makes it illegal to “structure” deposits to evade such reporting.
Because 35 percent of Schott’s Supermarket’s receipts are in cash, Terry and Sandy make frequent trips to the bank to avoid tempting actual criminals by having large sums at the store. Besides, their insurance policy covers no cash loss in excess of $10,000.
The IRS used “civil forfeiture,” the power to seize property suspected of being produced by, or involved with, crime. The IRS could have dispelled its suspicions of Terry and Sandy, if it actually had any, by simply asking them about the reasons — prudence, and the insurance limits — for their banking practices. It had, however, a reason not to ask obvious questions before proceeding.
The civil forfeiture law — if something so devoid of due process can be dignified as law — is an incentive for perverse behavior: Government agencies get to pocket the proceeds from property they seize from Americans without even charging them with, let alone convicting them of, crimes. Criminals are treated better than this because they lose the fruits of their criminality only after being convicted.
Sandy remembers her father exclaiming, “Aren’t we in the United States? We did nothing wrong.” They did something right in discovering the Institute for Justice’s activities against civil forfeiture abuse. IJ, a libertarian defender of property rights and other American premises, says that what was done to Terry is done routinely across the nation.
In what it probably considered an act of unmerited mercy, the IRS offered to return 20 percent of Terry’s money. Such extortion — pocketing others people’s money — often succeeds when the IRS bullies bewildered people not represented by IJ, which forced the government to return all of Terry’s money.
IJ’s countersuit seeks an injunction to prevent such IRS thefts and extortions. Meanwhile, earnest moralists might consider the possibility that Americans’ distrust of government is insufficient.
George F. Will is a columnist for the Washington Post Writers Group. Email: firstname.lastname@example.org.