My dad is in his seventies and an immigrant from Russia. He would absolutely do this because he never got past his distrust of banks and other major institutions, nor did he lose his tendency to transport valuables in cotton linings sewn into a suitcase or a pair of pants.

Inadvisable? Absolutely. And I'm sure there's plenty of other examples of people moving around large amounts of cash for dubious reasons. So, if they lose the cash or get robbed, some degree of "I told you so" is absolutely in order. But getting robbed by your own government should not be on the list of possible consequences of dubious (but legal) ideas.