It's not often that I can report news that's actually favorable to financial privacy. Today is a happy exception. I'm pleased to report that the Transportation Security Administration has modified its rules regarding detaining and questioning airline passengers carrying large quantities of cash.
In March 2009, TSA officials in St. Louis detained Steven Bierfeldt after discovering US$4,700 in cash in his carry-on bag. Bierfeldt, the Director of Development for the Campaign for Liberty (an offshoot of Congressman Ron Paul's presidential campaign), was about to board a domestic flight.
TSA agents placed Bierfeldt in a small room and began to interrogate him. Bierfeldt refused to answer the questions. Instead, he repeatedly asked the agents to explain the scope of their authority to detain and interrogate him. Not only did the agents refuse to do so, they also told Bierfeldt he was being arrested.
Fortunately, Bierfeldt had the presence of mind to make an audio recording of the incident on his cellular telephone. The recording reveals a series of threatening and expletive-laden questions relating to why Bierfeldt was carrying cash. When he was finally released, Bierfeldt turned the recording over to the American Civil Liberties Union. Shortly thereafter, the ACLU sued the Department of Homeland Security, which has authority over the TSA, on his behalf.
TSA officials are authorized to conduct safety-related searches for weapons and explosives. They have no right to interrogate passengers about matters unrelated to passenger safety. Carrying cash aboard a flight obviously poses no safety risk. And it's perfectly legal to carry as much cash aboard an airplane as you want. Unless you're transporting more than US$10,000 in cash across a U.S. border, no reporting is required.
I anticipated a long and drawn-out lawsuit in this case. Indeed, I thought the TSA might press for new rules providing explicit authority for agents to confiscate "suspicious" quantities of cash. However, I was happily surprised to learn last week that the TSA has instead issued new rules that prohibit agents from interrogating passengers on matters unrelated to aircraft safety. Transporting $4,700 in your carry-on bag, or $470,000, for that matter, doesn't qualify.
However, I still don't recommend that you transport a large quantity of cash on an airplane departing and/or or arriving in a U.S. airport. The reason is that at some airports, TSA screening may be supplemented by a separate inspection for narcotics. Most U.S. and foreign currency contains minute traces of narcotics residues. A drug-sniffing dog is likely to "alert" to any large quantity of cash you're carrying. That alert may provide probable cause for police to then seize the cash under federal or state civil forfeiture laws. You may or may not get the cash back, and you'll face an expensive and protracted court battle to prove it came from a legitimate source.
Copyright © 2009 by Mark Nestmann
(An earlier version of this post was published by The Sovereign Society, https://banyanhill.com/)
