Asset Forfeiture

Popular theories often describe emotion and greed as two principal reasons behind criminal behavior.

Examples of emotion-based crimes would be road rage incidents while greed-based crimes are characterized by the acquisition of material goods, frequently taking the form of expensive cars, jewelry, vacation homes and simply "toys." Asset forfeiture attempts to eliminate the defendant's ability to muster resources continuing their unlawful activities. Often asset forfeiture occurs in high-profile matters, and the community sees the defendant's assets forfeited and sold at auction. While there aren't any comprehensive studies that confirm exactly what, if any, actual deterrence has been realized from asset seizure and forfeiture, most criminals understand they may lose their assets as a result of their unlawful acts.

The application of asset forfeiture is a legal concept that involves procedures resulting in the transfer of defendants' assets to the government or to other claimants. Some have the opinion that asset forfeiture is only associated with narcotics matters, however, forfeiture may include such criminal acts as: theft of intellectual property, economic espionage, Internet fraud and child pornography.

Depending upon the jurisdiction, there are usually two main divisions in forfeiture proceedings: criminal and civil actions. Criminal forfeiture (in personam) must be processed judicially. The jurisdiction of the criminal court provides it with jurisdiction over the defendant's property. In the United States, the United States District Court issues an order seizing the property based upon a sworn statement of facts and circumstances. It's important to note that criminal forfeiture laws provide for hearings to consider third-party claims to forfeited property, protecting their interests. The location and dates of such hearings are published in the "Legal Notices" sections of newspapers. Usually these hearings require innocent parties to establish they weren't participants in the criminal enterprise and/or they weren't knowledgeable of the defendant's unlawful activities.

Civil forfeiture actions (in rem) usually proceed through either administrative or judicial procedures. The seizing agency may initiate an administrative action against property if it is valued at a threshold amount, usually fixed by law or regulation. Once assets have been seized, it is incumbent upon interested individuals to file their claims. Notices of seizure are usually sent by mail and advertised in major newspapers. If the forfeiture action is not contested in a timely manner, legal claims to the property may be thereafter barred and the property forfeited.

Once civil forfeiture action has begun, the government's burden of proof is a preponderance of the evidence. In other words, the government's forfeiture case is decided by the weight of the evidence being 51 percent. Civil forfeiture usually commences upon notification by mail and publication of the government's intent to forfeit the seized property

Judicial forfeiture has the initial burden of proof of probable cause. Probable cause is the idea that it is probable that a crime has been committed and its probable that the seized items were fruits or instruments of that crime. Upon presentation of sufficient probable cause that the property has been tainted by the illegal conduct, it is the responsibility of the claimant (or defendant) to refute the government's claims and, if sufficient discrediting evidence or argument is presented, the property returns to the possession of the claimant. However, if after hearing arguments and evidence of the claimant and the government, the court decides that there is proof beyond a reasonable doubt supporting the government's case, then the asset will be forfeited.

Often the question of whether criminal prosecution and asset forfeiture constitute double jeopardy arises. On June 24, l996, the United States Supreme Court decided a landmark case, U.S. v. Ursery, which brought finality to this question. In the Ursery matter, the government brought civil forfeiture proceedings against Ursery's house. The allegations were that it had been used to facilitate illegal drug transactions. Just before settling the forfeiture matter, Ursery was indicted and later convicted of manufacturing marijuana, in violation of Title 21 U.S. Code sections, 841(a)(1). The Court of Appeals reversed Ursery's conviction and held that the forfeiture and criminal conviction constituted double jeopardy.

The United States Supreme Court hearing the Ursery case, decided that the following factors were important:

1. In rem civil forfeiture has not historically been regarded as
2. The fact that both actions are tied to criminal activity is
    insufficient in itself to render them punitive.

The Supreme Court also found that "Congress may impose both criminal and civil sanctions with respect to the same act of omission" (Helvering, 303 U.S., at 309). The Court went further saying that in rem civil forfeitures are neither "punishment" nor criminal for purposes of the Double Jeopardy Clause of the U.S. Constitution.

In essence, the Supreme Court ruled that criminals may suffer punishments resulting from their convictions and may also have their possessions forfeited, without constituting double jeopardy.

The framers of the U.S. Constitution were very aware of the dangers of being prosecuted repeatedly for the same crime when they approved the Bill of Rights. Other governments had used repeating prosecutions and asset forfeiture without due process to rid themselves of political and personal foes. In an effort to preclude this from happening, the Fifth Amendment to the Constitution states: "No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation."

Currently, most jurisdictions have laws that prevent their citizens from being deprived of their assets without due process. In essence, due process includes independent judicial review before any forfeiture action is adjudicated and includes criminal, civil and administrative proceedings. As an integral part of due process, the right to judicial appeal is also assured. In the United States, criminal prosecution and accompanying asset forfeiture have been determined not to constitute double jeopardy and may be pursued simultaneously. Although criminal prosecution and asset forfeiture may be thought as extreme, many believe they constitute a viable crime deterrent and are actively pursued.

Alan B. Sterneckert, CISSP, CISA, CFE, CCCI, is a retired special agent, Federal Bureau of Investigation.

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