Legality of buying BTC from exchanges and selling on LocalBitcoins?

Can anyone provide advice for a friend of mine? My friend wants to buy BTC from the popular US exchanges and sell on LBC for small profit margins and do this full-time. His preferred method is cash deposit by bank and he lives in CA. He does not have a MSB license and uses a mixer to send BTC from the popular US exchanges to LBC for selling. He receives cash deposits in his bank accounts from all different parts of the country and was once questioned by his bank about this and he answered that he sells digital currencies.

My friends wants to sell around 3K USD of BTC per day. It seems in the news, law enforcement only catches people who do in person cash transactions over $10K who knowingly sell to people (who are actually undercover agents) who state they will be using the funds to buy stolen CC or drugs. Will my friend get into trouble eventually when the bank turns in financial records showing large amounts of in and out cash flow to the IRS?