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Federal Forfeiture Reform: 81% Property Seized By DOJ from People Never Charged With a Crime

Last week, the Office of the Inspector General in the Department of Justice published its report on federal civil forfeiture, entitled “Review of the Department’s Oversight of Cash Seizure and Forfeiture Activities.”

The full report is available online and has been stored in the Michael Lowe Digital Library for your convenience.  Read it here.


81% of federallyseized forfeiture CASH from peoplenever charged with a crime.

Inspector General’s Report on Federal Forfeiture Activity

The Inspector General report covers a ten year time period of federal seizures of property and cash (since 2007).  The total amount seized?  Over $4,000,000,000.00, that’s right: FOUR BILLION DOLLARS.

And of that total sum, $3.2Billion was taken (and kept) by the federal authorities from people who were never convicted of any crime.  That is 81% of the seized property.  EIGHTY-ONE PERCENT.

No wonder that some call this “state-sanctioned theft.”

What is Civil Asset Forfeiture?

We’ve discussed how law enforcement profits from taking all kinds of property from people and keeping it.  Both the federal government and the State of Texas actively use their respective forfeiture laws.

The gist of it: the government seizes things under the legal forfeiture process using the excuse that the stuff is suspicious and the agents or police officers believe that it may be used in some kind of criminal activity.  Then the government keeps it.  They keep cash, jewelry, guns, art, cars, you name it.

For details, check out our past discussions including:

Rand Paul Introduces FAIR Act to End Federal Civil Asset Forfeiture Abuse

We’ve discussed state forfeiture actions, and the attempt that is being made in Texas right now to end, or to amend, the current Texas forfeiture procedures.  See, “Texas Needs New Asset Forfeiture Law Reform: Spread the Word.”

However, that will do nothing to block federal forfeiture actions.  For that, a federal law is needed. So, Senator Rand Paul has introduced legislation (Senate Bill 642) to end federal civil asset forfeiture abuses.

Senator Rand Paul’s Proposed FAIR Act

It’s called the “Fifth Amendment Integrity Restoration Act” (FAIR Act).  This proposed legislation works by amending the current federal forfeiture law in several ways (18 U.S.C. § 983):

1.  FAIR Act Increases Government’s Burden of Proof

It boosts the burden of proof placed on the federal government to prove its right to seize the property.  Right now, the federal government has to meet the same standard used in any civil case (e.g., a contract dispute, a landlord-tenant action, or a car accident), which is by a preponderance of the evidence.

The FAIR Act boosts the Burden of Proof to the highest of all civil evidence standards, that of “clear and convincing evidence.”

This means that they would have to have solid evidence to support those suspicions that the property might be used for criminal activity.  Lots of proof to back up the suspicion.

 2. FAIR Act  Provides Innocent Owner Defense

Right now, if the federal government seizes your property and files a lawsuit to get a judge’s okay to let the government keep it, guess what?  The property owner has to go before the judge with evidence that no, the property wasn’t being used for criminal activity.

The FAIR Act takes this burden off the owner.

3. FAIR Act Gives Appointed Counsel

If the property owner who has property seized by the federal government needs a lawyer and cannot afford one, then they will have the right to appointed counsel in federal civil asset forfeiture proceedings.  Right now, they don’t.

4.  FAIR Act Ends Equitable Sharing

Another key provision in the FAIR Act:  it ends “equitable sharing” between the federal government and state or local authorities.  We’ve discussed this problem here in Texas.

Right now, states and local law enforcement (including county district attorney offices) can get around tighter state laws and restrictions by working with the federal agencies.  They work jointly under the broader federal forfeiture laws, allowing the federal agents to seize and take ownership of the property.  Then, everyone shares in the pie (“equitable sharing” of the seized stuff).

According to the Report, the DOJ has “equitably shared” over $4.7Billion in federal forfeiture money.

5. FAIR Act Protects Against Structuring (IRS Seizures)

Right now, the Internal Revenue Service is allowed to seize money out of bank accounts using the claim of “structuring law violations.”  We’ve discussed this problem here and how so many innocent people have been seriously hurt in structuring cases.

The FAIR Act would make the IRS provide evidence that the defendant knowing deposited the money with a criminal intent.  It would also require a hearing before a judge within two weeks (14 days) of the seizure, where the IRS would have to show the judge all the evidence supporting the seizure and its probable cause to do so.

The Problem with Civil Asset Forfeiture: It’s Policing for Profit

If you read the Inspector General’s Report, then the message is clear.  The taking of all this property by law enforcement is not working to fight criminal activity – its main purpose is to grab property and take ownership of it.

Inspector General Questions Motivation for Forfeitures

The Report gives concrete examples of specific forfeiture actions by various federal agencies (particularly the DEA).  For instance, in a discussion of a single seizure case involving millions in cash, the Report states (emphasis added):

Based on intelligence collected from the money laundering operations, other federal law enforcement agencies conducted additional investigative work which, according to the task force, resulted in the arrest of 84 individuals and the seizure of approximately $49 million. The OIG found that the BHPD received over $6 million in revenue derived, in part, from equitable sharing payments related to these seizures. However, according to a task force official, the task force did not file a single criminal indictment related to its money laundering investigative operations….

Such outcomes can raise questions about whether seizures are intended to serve legitimate law enforcement interests or to bolster law enforcement budgets.

Forfeiture Being Policing for Profit Isn’t a New Revelation

This is not news.  The warning that forfeiture laws were being used as “policing for profit” has been around for a long time.  See, e.g., our 2010 warning in Are Police Just Taking Property For Their Own Profit and Use? You Betcha.

However, now the Inspector General seems to have joined with critics of asset forfeiture to point to the profit-generating motivation of today’s forfeiture activities.

From the Inspector General’s Report (emphasis added):

…. [W]e found that 85 of the 100 seizures occurred as a result of interdiction operations at transportation facilities, such as airports, parcel distribution centers, train stations, and bus terminals, or as a result of a highway interdiction or traffic stop. All but 6 of the 85 encounters or situations that led to interdiction seizures were initiated on the observations and immediate judgment of DEA agents and task force officers absent any pre-existing intelligence of a specific drug crime (the remaining six were based on preexisting intelligence).

Further, a majority of the seizures examined were seemingly carried out for no other reason than to seize cash.

[T]he DEA could verify that only 44 of the 100 seizures, and only 29 of the 85 interdiction seizures, had (1) advanced or been related to ongoing investigations, (2) resulted in the initiation of new investigations, (3) led to arrests, or (4) led to prosecutions.

The Inspector General is recommending changes be made.  Things like better training for federal agents and changing forfeiture practices and procedures within the Department of Justice.

Of course, lots of this may not be necessary if Senator Rand Paul’s bill becomes law. To follow Senator Paul’s legislation, go here.


For more information, check out our web resources, read Michael Lowe’s Case Results, and read his in-depth article ”STRUCTURED CASH DEPOSITS: WHAT DO I DO WHEN THE IRS CID AGENT COMES?




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