March 21, 2012
Department of Justice
United States Attorney William C. Killian Eastern District of Tennessee
Morristown Veterinarian Pleads Guilty to Structuring Currency Transactions to Evade Reporting Requirements
GREENEVILLE, Tenn.-- Larry Mark Mangum, 55 of Morristown, Tenn., waived indictment and pleaded guilty today in U.S. District Court for the Eastern District of Tennessee at Greeneville, to an information charging structuring currency transactions to evade reporting requirements. Sentencing has been set for August 6, 2012, at 1:30 p.m.,.in U.S. District Court in Greeneville.
Mangum faces a term of up to 10 years in prison and up to $500,000 in fines.
As set out in the plea agreement filed with the court, between January and June 2009, Mangum, a veterinarian practicing in Morristown, Tenn., structured $182,500 in cash payments to a home equity line of credit (HELOC) at Regions Bank in Morristown, Tenn., by making 33 cash payments in amounts ranging from $1,400 to $9,900 over the five-month period..
Federal law requires financial institutions, such as banks and credit unions, to report on a currency transaction report (CTR) any cash transactions, such as deposits, withdrawals, and payments in excess of $10,000. The law also requires that multiple transactions be treated as a single transaction if the financial institution has knowledge that the transactions are conducted by, or on behalf of, the same person, and they result in either currency received or disbursed by the financial institution totaling more than $10,000 during any one business day.
Federal law makes it an offense to “structure” cash transactions with a financial institution to evade the filing of a CTR. Regulations define “structuring” as including breaking down a single sum of currency into smaller sums below the $10,000 reporting threshold to evade the filing of a CTR. As part of the structuring scheme, Mangum made nine payments between January 16 and February 5, 2009, in amounts between $9332.81 and $9900.00.
In June 2009, Regions Financial sent Mangum a letter advising him of the requirement for banks to file currency transaction reports on cash transactions over $10,000 and their obligation to report "structured" transactions. The letter in part stated:
To comply with federal banking regulation, it will be necessary for anyone conducting transactions on your account to assist us in completing the required Currency Transaction report for every cash transaction over $10,000. No attempt should be made to “structure” cash transactions to avoid this requirement.
After receiving the letter, Mangum stopped making substantial cash payments through Regions Bank, instead making cash deposits through accounts at Community National Bank, Jefferson Federal Bank, and First Tennessee Bank.
During an interview with an Internal Revenue Service-Criminal Investigation (IRS-CI) special agent in May 2011, Mangum admitted that he had deposited large sums of cash under the $10,000 threshold because he did not want the bank to fill out “the form” (currency transaction report). Mangum said that the cash represented his “life savings” and he had intentionally broken the deposits of the cash to increments of under $10,000.
This indictment was the result of an investigation by IRS-CI. Assistant U.S. Attorney Neil Smith represents the United States.