Louisiana Bans State’s Businesses From Accepting Cash

Writing for the blog of Louisiana-based law firm Ackel & Associates, Thad D. Ackel reports on a bizarre and troubling development in Louisiana law, a statute that prohibits Louisiana’s businesses from accepting cash transactions if they qualify under the new law as “secondhand dealers.”

The statute includes the following language:

 

House Bill 195 of the 2011 Regular Session (Act 389)

“Anyone, other than a non-profit entity, who buys, sells, trades in or otherwise acquires or disposes of junk or used or secondhand property more frequently than once per month from any other person, other than a non-profit entity, shall be deemed as being in the business of a secondhand dealer.

…

A secondhand dealer shall not enter into any cash transactions in payment for the purchase of junk or used or secondhand property. Payment shall be made in the form of check, electronic transfers, or money order issued to the seller of the junk or used or secondhand property…”

 

Talk about overreach! As Ackel so eloquently puts it:

 

“The broad scope of this definition can essentially encompass everyone; from your local flea market vendors and buyers to a housewife purchasing goods on ebay or craigslist, to a group of guys trading baseball cards, they could all be considered secondhand dealers. Lawmakers in Louisiana have effectively banned its citizens from freely using United States legal tender.”

 

But the law doesn’t just stop there. It actually goes so far as to require “secondhand dealers” to effectively spy on their customers, law-abiding citizens who have given the state no reasonable suspicion that they are guilty of criminal conduct other than buying or selling used goods, which is obviously not an inherently suspicious activity.

You read that correctly. For every transaction they undertake, “secondhand dealers” as designated by the state of Louisiana are now required to obtain “the seller’s personal information such as their name, address, driver’s license number and the license plate number of the vehicle in which the goods were delivered,” and report all the information to the police on a daily basis.

You can see how the new rules might be financially cumbersome for small businesses, limiting the number of transactions they can make by outlawing one of the most common forms of payment and creating burdensome compliance costs that eat up a small business’ time and money. But the new law doesn’t just violate the economic liberty of Louisiana businesses, it might very well violate the civil rights guaranteed by the Constitution.

A company’s proprietary client information is a valuable business asset. Requiring businesses to turn that over without a warrant as part of a specific criminal investigation is an unconstitutional seizure of private property without due process of law, nor just compensation, a violation of the Fifth Amendment and the Fourteenth Amendment. It might also violate the Fourth Amendment, which guarantees:

 

“The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

 

The new law doesn’t authorize police to make warranted searches, upon probable cause, for a particular reason– it authorizes them to canvass residents as they engage in lawful commerce with each other, treating them like suspects dealing in stolen goods for the mere act of selling used goods. This unwarranted, blanket investigation of all citizens as potential criminals is an unhistorical aberration from the norms established for America by the Constitution, and a chilling hallmark of the modern police state.

To take just another example, notice how the TSA conducts unwarranted, canvass searches of everybody who simply wants to lawfully travel by plane. The mere act of traveling by plane is not an inherently suspicious activity and does not warrant police investigation, yet the TSA treats that act as if it is and searches every citizen who does it– a violation of the Fourth Amendment.

Reversing this illegal, police state trend of canvass investigation will only be possible when enough Americans read and understand the Constitution and the rights it guarantees them, and when they see that the police state not only threatens their liberties, but that its canvass methods are incredibly costly, wasteful, inefficient, and ineffective at fighting terrorism and crime.