Victory Over the IRS: IRS Returns N.C. Man’s Entire Life Savings After Seizing It Through Civil Forfeiture

IRS Wrongly Took More Than $150,000 from Ken Quran

Arlington, Va.—It is a major victory for the individual against the seemingly all-powerful IRS. In a single-page letter, sent this morning by fax, the IRS agreed to return a North Carolina convenience store owner’s entire life savings.

The IRS seized $153,907.99 from Ken Quran in June 2014, without any warning or meaningful prior investigation, simply because he repeatedly withdrew cash from his bank in amounts under $10,000.

Ken’s money was seized under so-called “structuring” laws. These laws were designed to target criminals evading bank-reporting requirements. But under IRS policy at the time of the seizure, the IRS applied the structuring laws to seize cash from individuals and businesses accused only of frequent under-$10,000 cash transactions.

The IRS changed its policies in October 2014 to prevent such seizures. But those changes came too late for people like Ken, whose property was seized before the policy change.

So, in July 2015, the Institute for Justice submitted a petition to the IRS on Ken’s behalf, arguing that the IRS should apply its policy retroactively to Ken’s case. The petition argued that the money “would not be seized—much less forfeited—under current government policy” and urged the IRS to “do the right thing and give the money back.”

This week, IJ sent a letter to IRS Commissioner John Koskinen following up on the petition—and urging the IRS to act quickly to give Ken his money back.

Today’s letter states that Ken’s petition is granted “in full.”

“I’m so happy,” said Ken, “The IRS never should have taken my money in the first place, but I’m so grateful that it has now done the right thing. I worked hard for that money. This is justice.”

The Institute for Justice also filed a petition in July 2015 on behalf of Randy Sowers, a Maryland dairy farmer who had $29,500 forfeited by the IRS. There has not yet been any ruling on Randy’s petition.

“If the IRS is willing to do the right thing for Ken, they should do the right thing for Randy—and all the other property owners in the same situation,” said IJ Attorney Robert Everett Johnson, who represents both Ken and Randy. “Today’s decision opens a way for other victims of the structuring laws to get back what’s rightfully theirs.”

According to data obtained by the Institute for Justice from the IRS via the Freedom of Information Act, the IRS forfeited about $43 million in 618 structuring cases between 2007 and 2013 in which the IRS reported no suspicion of criminal activity other than the mere fact of sub-$10,000 cash deposits.

“Today’s decision shows what you can accomplish with the courage of your convictions and the force of justice on your side,” said IJ President Scott Bullock. “We asked the IRS to do the right thing, and the IRS agreed.”

This video shows how Ken Quran’s account was seized by the IRS:

https://www.youtube.com/watch?v=oOXZBu-otJ4

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[High-quality photos and videos of Ken and Randy available at:

https://www.dropbox.com/sh/3jp835qanip50va/AADA77HFus9I5RMCKssXsWepa?dl=0]

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