I don't want to go too far beyond the scope of our study.
In the fight against terrorism, the way that police officers work generally protects innocent people and prevents them from being found guilty by association. In the example that you just provided involving a transaction with me, who has had issues in the past, the individual would be protected by the police's work. You would simply tell the police that money was transferred between us. It would then be the police's responsibility to check whether an investigation is warranted.