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What is an IRS CI financial investigation?

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IRS CI stands for Internal Revenue Service Criminal Investigation. This arm of the IRS conducts investigations into alleged violations of the Bank Secrecy Act, allegations of money laundering and accusations of violations of the U.S. Tax Code. It uses the latest in computer forensics and document examination to perform the majority of its duties.

During a financial investigation, the IRS CI will examine an extensive number of documents relating to your life. This could include real estate records, motor vehicle records and bank records just to start. Investigators will examine your computer and work to decrypt passwords and encrypted files. If you face an IRS CI financial investigation, you may want to obtain legal counsel as quickly as possible. Reportedly, this unit’s success rate is the highest in the federal system.

What matters do financial investigations cover?

Financial investigations most often fall into one of the following three categories:

  • Counterterrorism and narcotics-related financing crimes: The IRS CI seeks out sources of funding for terrorist activities and shuts them down. Investigators focus on money laundering and shutting down funding for drug-trafficking operations as well.
  • Illegal source financial claims: This area involves investigating all types of fraud, embezzlement and money laundering. It also investigates alleged violations of Bank Secrecy Act laws and currency violations.
  • Legal source tax crimes: These investigations include tax crimes related to legally incurred income, such as tax fraud and tax evasion. It also looks into cases where taxpayers fail false returns or fail to file at all.

If you face a financial investigation, it will more than likely be in one of these three areas. These investigators will go through your life with a fine-toothed comb, and you may need someone with experience in the U.S. Tax Code at your side protecting your rights, especially in light of the changes made by the US Tax Cuts and Jobs Act. The act made numerous changes to the tax code that many are still attempting to figure out.

While a criminal defense attorney may have utility in these cases, he or she may not understand the tax laws well enough to provide you with the best defense possible. Even when no one accuses you of any underlying criminal activity, your freedom could remain at stake in a legal source tax investigation. In addition, the associated financial ramifications could prove significant. You deserve legal representation, and you may want to consider taking advantage of it.

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