Ruined U.S. Cash Worth Millions, but Stories are Priceless
Monday, October 5, 2009
The fast-talking and well-dressed Texas customs broker has arrived at the Treasury Department twice in recent years with luggage stuffed with crusty, grimy greenbacks. The money was ruined, he said, and worth about $6.4 million.
The broker wanted to exchange the soiled bills, unearthed in Mexico, for a U.S. government check. But the transactions raised questions for authorities. Was the cash drug money? Was it tied to money laundering? Was it an inheritance? Or had it been exhumed from a coffin with the help of a treasure map? There have been many theories over the years.
Only now, after delicately counting the bills and running down leads, are authorities and attorneys for the broker's clients unraveling the mystery of the Mexican moola. Their answers are not particularly satisfying. But that shouldn't be a surprise. They are talking about buried treasure, after all.
"This would make a great book or a movie," says David B. Smith, a lawyer representing the broker's clients. "It's offbeat. It has characters."
The Mexican cash sheds light on what is normally a little-noticed program at the Bureau of Engraving and Printing in downtown Washington. Each year, the bureau handles about 30,000 transactions involving mutilated currency worth $30 million, according to its tersely worded Web site. The ruined money doesn't go back into circulation. A spokeswoman for the bureau, Claudia Dickens, declined to comment, saying that officials were too busy to discuss the program.
Other officials said the redemptions are usually routine matters, involving cash damaged in floods or fires, for example. But some transactions have great stories behind them, such as a request three years ago by a Japanese man who showed up at the bureau with $100,000 in mutilated bills.
He said the money had been buried for years, but a closer inspection by bureau experts revealed that it had been "bleached, worn, ripped, or otherwise damaged deliberately," a federal agent wrote in court papers.
In January, federal prosecutors filed court papers seeking to confiscate $50,900 in damaged bills that a man said had been buried in a toolbox in Mexico by his father decades ago. No bill was older than 1995, casting doubt on the story, prosecutors said. Last week, a federal judge in Washington granted the government's request to confiscate the cash.
Intriguing yarns, for sure. But they pale compared with the saga of the badly damaged Mexican cash and the Texas customs broker, Franz Felhaber, whose job is to ensure that goods and cash flow smoothly across the U.S. border.
Felhaber first came onto authorities' radar in August 2005, when he, his uncle and a female relative appeared at the Federal Reserve Bank in El Paso.
They had $120,000 in water-damaged and ruined cash, just a small portion of millions of dollars they said had been found under a building in Mexico. Bank officials exchanged the cash for a check.
Over the next month, federal agents say, Felhaber tried to exchange small amounts of damaged money at El Paso banks. That's when he and his associates began telling different stories about the money's provenance, federal agents wrote in court papers.