By CP Staff
By Olivia LaVecchia
By Chris Parker
By Jesse Marx
By John Baichtal
By Olivia LaVecchia
By Jesse Marx
By Olivia LaVecchia
When the program works really well, says Urbanski, the deal goes down this way: "There was a small-time drug dealer," he says, "who laundered about half a million dollars in four months [in 1986]. We got a call from a bank and a broker of a coin company simultaneously. We didn't connect the calls until the next day. The broker said the guy comes in three times a week. What he was doing was taking small bills, denominations in 20s and 50s, $30,000 worth at a time, and buying silver and gold coins. What happened was we got another call from the broker who said the guy was supposed to be in at noon. We went over to do some surveillance and started following him. We followed him approximately two and a half or three months and got enough probable cause to search his house, the coin company, and the safe deposit boxes he had at two banks. We found $300,000 worth of coins in one bank, $30,000 in currency, and a half kilo of cocaine in brick form."
After the dealer and the president of the coin company were prosecuted and sent to jail--the broker introduced an undercover agent to the president, who unwisely told the agent he'd be more than happy to launder money for any illegal business and that he had experience doing so--the broker received a reward. Urbanski won't say exactly how much, but calls it "a good amount, four figures."
"Usually a person who calls [has information] on one individual," says Marrero, but "we do have some regulars. Because of the contacts they have--they might say, 'I know some other people you may be interested in.' Usually they are what you might call professional informants. They will come to us, the FBI, the DEA, because of the thrill. They like being involved in law enforcement.
"We always tell them they can't do anything illegal," he adds, noting that some gung-ho callers have volunteered to break and enter in order to steal documents. "We say, 'No, no, don't do that. Tell us where they are and we'll get a warrant. You can't try to entrap. You can't try to record the guy on your own without us being involved.' We forewarn those informants on the front end that there are some limitations as to what they can do. They are also advised that any money we pay them is taxable. They have to report it on their return. At the end of every year we verify that they have done that. We take special care to do that."
The snitch program is confidential; practically the only way an informant's identity can ever be revealed--the agents who do have access to a name are directed to withhold it, even in court--is if they try to collect a reward for their assistance, in which case they have to fill out IRS form 211. Many informants get a little queasy when it comes to creating a paper trail, and the form tends to act as a deterrent to claims-filing overall. It's part of the reason that the IRS hardly ever has to pay anybody.
"Most people want to remain anonymous," says Marrero, who claims he does not have Caller ID in his office. "Many people don't want a reward because their name could happen to show up somewhere. But it has to, or how do we pay them? We have had cases before where the target has requested through legal motions to find out who the informant was and we filed our motions and denied access to that information. For the most part we've won those battles, though I can't say it's been 100 percent."
"Less than 10 percent try to claim a reward," adds Urbanski. "Then 1 to 2 percent of those actually get a reward. A lot of times, and I'll tell you where the catch-22 comes in, the information furnished by that individual is evaluated in the end. Let's say the person furnishes information that generates an audit. It was the basis for the audit, but factors other than the information they gave us determined that taxes were due. In that case, they wouldn't get anything." In short, the IRS doesn't like to pay out money and does everything it can to avoid doing so. At the end of the day, the payoff for snitching somebody out to the IRS is rarely lavish, says Urbanski: "I saw someone who got $50,000 only once in my career. And I worked for the IRS for 33 and a half years."
According to Marrero, you practically have to have been someone's bookkeeper or husband in order to collect any substantial amount: "Let's say someone says John Doe isn't filing his tax return. That's typical. All they know is that John Doe has bragged about not paying taxes for over 10 years. We may look at that and find out that he, in fact, has not paid for over 10 years. We investigate. We have to determine based on our investigation what the nature of the income was because he or she couldn't tell us. That's not as specific as someone saying, 'John Doe is in the business of homes construction. He only reports the money he receives through the bank or through checks. If it's in cash, he doesn't report it. His money is deposited in this bank. I know this has been going on for X years. Here are some people who paid him in cash.' The more specific the information, the easier it is for us to follow up, and the more the informant should be entitled to receive. It's determined on a case-by-case basis. But of the ones who ask for rewards, most of those don't result in payouts for various reasons."