After publicly humiliating the Internal Revenue Service, a North Carolina man received more than $100,000 from the agency.
Lyndon McLellan had the bank account for his convenience store seized by the IRS, and at first he wasn’t even sure why. The agency used civil asset forfeiture laws to take McLellan’s money without convicting or charging him of a crime.
The IRS said it suspected McLellan was violating federal structuring laws, which prohibit making multiple cash deposits of less than but near $10,000.
The federal government has taken criticism for stretching the bounds of structuring laws to seize property from well-intended people.
But even after policies were changed in 2014 to not seize property in these kinds of cases, it still wouldn’t relent on McLellan.
U.S. Attorney Steve West threatened McLellan that going public would only make things worse for him. He told McLellan it “just ratchets up feelings in the agency. My offer is to return 50% of the money.”
McLellan went to the press anyway. The IRS quickly changed its tune and gave Lyndon McLellan back all $107,702 of his money.
“The government cannot turn Lyndon’s life upside down and then walk away as if nothing happened,” Robert Everett Johnson, a lawyer at the Institute for Justice who represents Lyndon, said in a statement. “Lyndon should not have to pay for the government’s lapse in judgment. And the government certainly should not profit from its misbehavior by keeping the interest that it earned while holding Lyndon’s money. We’ll continue to litigate this case until the government makes Lyndon whole.”
Editor’s Note: An earlier version of this article listed McLellan’s home state as Virginia, but it is North Carolina.
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