Treasury Enforcement Agent Exam Case Studies & Practical Application 2 — Questions and Answers
Question 1: An IRS-CI agent receives a tip that a restaurant owner deposits exactly $9,800 in cash each week despite reported revenues far exceeding that amount. What crime is most likely indicated?
- Tax evasion only
- Structuring to avoid Currency Transaction Report requirements (Correct answer)
- Money laundering through legitimate business
- Bank fraud
Correct answer: Structuring to avoid Currency Transaction Report requirements
Deliberately keeping cash deposits just below the $10,000 CTR threshold is called structuring, a federal crime under 31 U.S.C. § 5324.
Question 2: During a financial investigation, an agent discovers that a suspect wired $50,000 to a foreign account the day after a search warrant was issued but not yet executed. This action most likely constitutes:
- Legal asset protection
- Obstruction of justice and potential money laundering (Correct answer)
- A routine international transfer
- Civil contempt only
Correct answer: Obstruction of justice and potential money laundering
Moving assets after learning of a federal investigation can constitute obstruction of justice and potentially money laundering to conceal proceeds.
Question 3: A TEA agent is analyzing bank records and finds 47 cash deposits of $9,500 over six months from different branches of the same bank. The BEST initial investigative step is to:
- Immediately arrest the account holder
- Subpoena all deposits and cross-reference with FinCEN Suspicious Activity Reports (Correct answer)
- Contact the bank manager informally
- Close the investigation due to amounts being below reporting thresholds
Correct answer: Subpoena all deposits and cross-reference with FinCEN Suspicious Activity Reports
Subpoenaing records and checking FinCEN SARs provides a legal foundation and may reveal a pattern of structuring across multiple financial institutions.
Question 4: A confidential informant tells an agent that a known drug trafficker is using a car wash to launder money. Before acting on this tip, the agent should FIRST:
- Conduct a raid on the car wash immediately
- Corroborate the tip through independent financial records and surveillance (Correct answer)
- Arrest the informant for withholding information sooner
- Notify the media to pressure the suspect
Correct answer: Corroborate the tip through independent financial records and surveillance
Informant tips must be independently corroborated before any enforcement action to ensure probable cause and protect against entrapment challenges.
Question 5: During an undercover operation, a Treasury agent is offered a $20,000 bribe by a target to drop the investigation. The agent should:
- Accept to maintain cover
- Refuse, document the attempt immediately, and report to a supervisor (Correct answer)
- Negotiate a lower amount to seem cooperative
- Ignore the offer and continue the investigation without reporting it
Correct answer: Refuse, document the attempt immediately, and report to a supervisor
Accepting a bribe is illegal; agents must refuse, immediately document the attempt, and report it as the bribe itself is additional criminal evidence.
Question 6: An agent executes a search warrant at a business and finds both relevant financial records and materials that appear unrelated to the investigation. The agent should:
- Seize everything present to be thorough
- Seize only items described in the warrant plus items in plain view that are clearly evidence of a crime (Correct answer)
- Leave all materials and return with a broader warrant
- Photograph unrelated items but not seize them under any circumstances
Correct answer: Seize only items described in the warrant plus items in plain view that are clearly evidence of a crime
The Fourth Amendment limits seizure to items specified in the warrant, with the plain view exception permitting seizure of obviously incriminating items observed during lawful presence.
Question 7: A suspect under investigation for tax fraud invokes their Fifth Amendment right during an interview. The investigating agent should:
- Continue questioning because tax cases are civil matters
- Immediately cease the interview and consult with the prosecutor (Correct answer)
- Advise the suspect that invoking rights implies guilt
- Switch to questioning about unrelated matters
Correct answer: Immediately cease the interview and consult with the prosecutor
Once a suspect invokes Fifth Amendment rights, all questioning must stop immediately or any subsequent statements may be inadmissible and the agent's conduct could violate the suspect's constitutional rights.
Treasury Enforcement Agent Exam Case Studies & Practical Application 2
An IRS-CI agent receives a tip that a restaurant owner deposits exactly $9,800 in cash each week despite reported revenues far exceeding that amount.
What crime is most likely indicated?