- Associated Press - Wednesday, February 11, 2015

MASON CITY, Iowa (AP) - The IRS will return $344,000 seized from a prominent Iowa neurologist who came under suspicion over the way he made cash withdrawals of his legally-earned money.

The move comes after federal prosecutors dismissed a civil forfeiture case last week involving Mason City doctor Alireza Yarahmadi, who had an innocent explanation for his transactions, according to his attorney, Gail Brashers-Krug.

The IRS seized $344,405 from Yarahmadi’s bank account a year ago, alleging that he repeatedly withdrew cash in amounts of less than $10,000 to evade federal reporting requirements. It’s illegal to structure transactions to purposely avoid the $10,000 limit, which requires the bank to report them to the federal government. The law is meant to help investigators find criminals trying to move illegal sources of money, but structuring can be prosecuted if the money is legal.

Brashers-Krug said prosecutors should be commended for using their discretion to drop the case. She noted that Yarahmadi is well-known for his work with patients who have strokes, epilepsy, multiple sclerosis and sleep disorders.

“He’s a perfect example of how a well-intentioned statute can just go terribly wrong and really wreak havoc in the life of someone who is just a phenomenal benefit to the community,” she said. “He was almost driven out of it because of this unfortunate policy.”



Yarahmadi routinely walked into a credit union where tellers knew him, took out cash from his account and walked over to deposit it in a safe deposit box for safekeeping, she said. Like many natives of Iran, he is suspicious of banks because his family lost its savings during the government takeover that followed the 1979 revolution, she said. He worried that his earnings - totaling $1.2 million over two years from his Mercy Hospital salary - could be vulnerable in an account that was only federally-insured up to $250,000.

Yarahmadi, a married father of four, thought “the smartest thing for him to do was to put cash in safety deposit boxes,” Brashers-Krug said. He’d read online that it was best to keep withdrawals under $10,000, but was unaware that it triggered a reporting requirement, she said.

A magistrate found probable cause to support the IRS seizure after Yarahmadi’s bank records showed he’d made 48 withdrawals below the $10,000 threshold in 2013. The government sought to forfeit the money, which would have gone back to the Treasury Department for law enforcement activities.

With the case pending in October, the IRS announced that it would focus its investigative resources on suspected structuring violations involving illegal sources of cash. Critics had complained that the agency was targeting too many individuals who deposited and withdrew legally-earned money.

Brashers-Krug asked prosecutors to dismiss the case in November, noting the change.

“It would be a miscarriage of justice to punish one of our most valuable citizens and deprive him of hundreds of thousands of dollars of his lawful salary, which he earned caring for the sick, as a result of a flawed policy that the IRS has already abandoned,” she wrote.

While grateful for the dismissal, Brashers-Krug said the ordeal had been very stressful for Yarahmadi and his family.

“It’s already hard enough for somebody in his position in rural Iowa to gain the trust and the comfort of his patients and he works really hard to do this,” she said. “He really felt like this cast a pall over his name, his reputation.”

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