Subject: Cu Digest, #5.48- LE Forfeitures and the Hyde Amndt
From: Cu-Digest <[email-masked]>
To: [email-masked]
Date: Wed, 30 Jun 1993 01:51:01

Computer underground Digest    Wed June 30 1993   Volume 5 : Issue 48
                           ISSN  1004-042X

       Editors: Jim Thomas and Gordon Meyer ([email-masked])
       Archivist: Brendan Kehoe
       Shadow-Archivists: Dan Carosone / Paul Southworth
                          Ralph Sims / Jyrki Kuoppala
                          Ian Dickinson
       Copy Editor: Etaoin Shrdlu, Seniur

CONTENTS, #5.48 (June 30 1993)
File 1--Time to Review Law Enforcement Forfeiture Practices
File 2--Reform of Civil Asset Forfeiture Act (HR 2417)

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Date: Thu, 30 May 1993 22:51:01 EDT
From: CuD Moderators <[email-masked]>
Subject: File 1--Time to Review Law Enforcement Forfeiture Practices

The "hacker crackdowns" of 1990, along with other more recent cases
such as the Akron/Munroe Falls BBS "porn" bust, Rusty & Edie's, and
similar incidents, resulted in the removal of computer and other
equipment of the persons raided by law enforcement. In most cases,
little (if any) of the equipment was returned.  When it was, as in the
cases of Steve Jackson Games or Len Rose, some was damaged or "lost."
The equipment that was not returned, while not necessarily forfeited
in the legal sense, was certainly forfeited in the conventional sense
of the term.  It was given up involuntarily never to be seen again.
Some victims, such as "Doctor Ripco" of Ripco BBS, were neither
accused nor suspected of criminal activity. In the Akron/Munroe Falls
case, the computer equipment was reportedly "retained" by local law
enforcement officials because it was defined as a burglary tool.  In
the Akron/Munroe Falls case, one law enforcement official allegedly
taunted the computer owner's mother by boasting how helpful the new
equipment would be for the department.

These cases represent a broader law enforcement trend in which
agents seize the property of citizens who may or may not be involved
in a crime. Such seizures, arising especially out of RICO (the
Racketeer Influenced and Corrupt Organizations Act) and
"tough-on-drug" laws have become a revenue-generating enterprise, and
one national law enforcement magazine advocated confiscations as a way
of easing department fiscal crunches.

According to an editorial in The Toledo Blade (reprinted in the
Chicago Tribune 28 June, '93: p 13), the inventory of seized property
exploded from $33 million in 1979 to $2 billion in 1992.  The Toledo
Blade editorial notes:

          All too many suspects--individuals who ultimately are
     not convicted of a crime--are seeing the government seize
     their belongings.  Already, in fact, Atty. Gen. Janet Reno
     has ordered a review of seizure guidelines, and the Supreme
     Court has acted to modify some of the U.S. policies.
                         ...............
          The specter of wealthy drug dealers throwing big bucks
     around has been a potent image that has rallied support for
     seizure policies. But an equally potent image should be a
     greedy federal bureaucracy grabbing all the property it can
     to fill its treasury.

Even the conservative Chicago Tribune has raised questions about
seizure practices. In a 30 June,'93 (p. 18) editorial, the paper
noted two U.S. Supreme Court cases this week that limited
forfeiture and added:

     Innocent until proved guilty? Not if your house is taken by
     the feds, who leave it to you to prove the guiltlessness of you
     and your home.

     Proof beyond a reasonable doubt? Hardly. Police need only a
     loose claim of "probable cause" to take possession of your
     property.

There is growing feeling that the law enforcement-seizure business has
gone too far.  Rep. Henry Hyde (R-Ill.), not generally noted for his
criticism of law enforcement, and the ACLU are pushing for federal
legislation that would curtail government seizures. Although the
impetus of the the Bill (HR 2417) derives primarily for seizures in
drug cases, the ramifications extend to the less dramatic world of
computer users as well.

In addition to Hyde's legislation, Rep. John Conyers (D-Mich)
also plans to introduce legislation curtailing seizure.

The following file provides a summary of Hyde's HR 2417.  It strikes
us as still excessively narrow and not going far enough to protect
against the type of seizures we have seen in some of the recent
computer incidents, and we welcome comments.  We also encourage
readers to write Rep. Hyde at:

Rep. Henry J. Hyde
2262 Rayburn House Office Building
Washington, DC (20515-1306)
Voice: (202) 225-4561  /  Fax:(202) 225-1240

Contacting John Conyers would also help:

Rep. John Conyers
2426 Rayburn House Office Building
Washington, DC  (20515-2201)
Voice: (202) 225-5126  /  Fax: (202) 225-0072

------------------------------

Date: Sun, 27 Jun 93 11:30:17 -0700
From: [email-masked]
Subject: File 2--Reform of Civil Asset Forfeiture Act (HR 2417)

[email-masked] (Charles Mattair)
Newsgroups--comp.org.eff.talk
Subject--HR 2417 - Civil Asset Forfeiture Reform Act

Representative Henry J. Hyde (R-Illinois, 6) has filed the Civil Asset
Forfeiture Reform Act (HR 2417).  The bill is expected to be taken up
before Ways and Means (I don't know which subcommittee if any).

Attached is an analysis made by the Hyde's office and a paper mailed
out which goes into more detail as to the justifications for the
changes.

I'll post the actual text of the bill if anybody asks - it's not
included here for two reasons: (1) the analysis is more understandable
and (2) my scanner does not like the fonts they use in a bill - I have
to type it in :-(.

All material is as prepared by Hyde's office - all typos are mine.  If
something doesn't make sense - send me Email and I'll check against
the originals.

Contact your congresscritters.

SECTION-BY-SECTION ANALYSIS OF THE CIVIL ASSET FORFEITURE REFORM ACT OF 1993
AS INTRODUCED BY U.S. REP. HENRY J. HYDE

Section 1. Short Title

Section 2. Limitation of Customs and Tax Exemption under the Tort Claims
           Procedures

   The U.S. Code at Title 28, sec. 2680(c), provides that the federal
   government may not be sued for torts arising from "the detention of any
   goods or merchandise by any officer of customs or excise or any other
   law-enforcement officer."  The Act modifies this section to ensure that
   claims can be brought if "based on the negligent destruction, injury,
   or loss of goods or merchandise (including real property) while in the
   possession of any officer of customs or excise or any other law-
   enforcement officer."  Thus, property owners are given the right to
   sue for property negligently damaged after being seized in ultimately
   unsuccessful civil forfeiture proceedings.

Section 3. Longer Period for Filing Claims in Certain In Rem Proceedings

   Rule C(6) of the Supplemental Rules for Certain Admiralty and Maritime
   Claims states that "[t]he claimant of property that is the subject of
   an action in rem shall file a claim within 10 days after process has
   been executed . . . ."  The Act extends this period in which a property
   owner can contest a seizure the customs laws to 60 days.

Section 4. Burden of Proof in Forfeiture Proceedings

   The U.S. Code at Title 19, sec. 1615, allocates the burden of proof in
   civil forfeiture proceedings brought pursuant to the customs laws.
   "[T]he burden of proof shall lie upon [the] claimant . . . . [p]rovided,
   that probable cause shall be first shown for the institution of such
   suit or action [by the government]."  The Act provides that the burden
   of proof shall not switch to the claimant, but shall at all times remain
   with the government.  The government must "establish, by clear and
   convincing evidence, that the property was subject to forfeiture."

Section 5. Claim after Seizure

   The U.S. Code at Title 19, sec. 1608, provides that:

      [A person contesting a civil forfeiture under the customs laws
      must] at any time within twenty days from the date of the first
      publication of the notice of seizure file . . . a claim stating
      his interest therein.  Upon the filing of such claim, and the
      giving of a bond to the United States in the penal sum of $5,000
      or 10 percent of the value of the claimed property, whichever is
      lower, but not less than $250 . . . such customs officer shall
      transmit such claim and bond . . . to the United States attorney
      for the district in which seizure was made, who shall proceed
      to a condemnation of the merchandise or other property . . . .

   The Act modifies section 1608 in three ways:

   1) The Act extends the period under which a claim has to be filed from
      20 to 60 days, to make it consistent with section 3 of the act.

   2) The Act eliminates the cost bond requirement.

   3) The Act adds a subsection to section 1608 providing that court
      appointed counsel shall be provided to claimants who are "financially
      unable to obtain representation of counsel."  Compensation shall be
      equivalent to that provided for court-appointed counsel under
      18 U.S.C sec. 3006A -- up to $3,500 for representation before a trial
      court and up to $2,500 for representation before an appellate court.

Section 6. Release of Seized Property for Substantial Hardship

   The Act specifies that property can be released if continued possession
   by the government would cause the claimant substantial hardship.  However,
   conditions may be placed on release as are appropriate to preserve the
   availability of the property or its equivalent for forfeiture should
   the government eventually win.

Section 7. Justice Assets Forfeiture Fund

   The Act provides that funds to pay court-appointed counsel under section
   5 of the Act shall come from the Justice Assets Forfeiture Fund.

Section 8.  Clarification Regarding Forfeitures Under the Controlled
            Substances Act

   The U.S. Code at Title 21, section 881(a)(7), provides that real
   property used to commit or to facilitate a federal drug crime is
   forfeitable unless the violation was "committed or omitted without
   the knowledge or consent of [the] owner."  This is meant to protect
   innocent owners.  However, a number of federal courts have seriously
   eroded the provision's protections by ruling that the owner must have
   both had no knowledge of and provided no consent to the prohibited
   use of the property.  The Act would clarify the meaning of this
   provision by changing the applicable language to "either without the
   knowledge of th[e] owner or without the consent of th[e] owner."

Section 9. Applicability

   The Act applies with respect to actions filed on or after the date
   of enactment.

Long paper describing abuses with civil forfeiture follows.  Hit N if
you don't want to read it.

INCIDENTS

* Willie Jones is the black owner of a landscaping service who paid for an
  airline ticket in cash.  This "suspicious" behavior caused the ticket
  agent to alert Nashville police. (1)  A search of Jones and his luggage
  yielded no drugs.  However, he did have a wallet containing $9,600 in
  cash on which a police dog detected traces of drugs (apparently true of
  97% of all currency now in circulation).  The cash was promptly seized
  despite protestations that it was intended for the purchase of shrubbery
  from growers.  No arrest was made. However, the seizure nearly drove
  Jones out of business.  He is unable to purchase the $960 bond necessary
  to mount a challenge. (2)

* Jacksonville University professor Craig Klein's new $24,000 sailboat was
  subjected to a fruitless drug search by U.S. Customs Service Agents.  In
  their 7-hour search, the boat was damaged beyond repair.  The engine was
  chopped up with a fire axe, the fuel tank was ruptured and 30 holes were
  drilled in the hull.  Mr. Klein sold the ship for scrap. (3)

* Billy and Karon Munnerlyn owned and operated an air charter service.  In
  October 1989, Mr. Munnerlyn was hired to fly Albert Wright from Little
  Rock, Arkansas to Ontario, California.  DEA agents seized Mr. Wright's
  luggage and found $2.7 million inside.  Both he and Mr. Munnerlyn were
  arrested.  Though the charges against Mr. Munnerlyn were quickly dropped
  for lack of evidence, the government refused to release the airplane
  (The charges against Mr. Wright, a convicted cocaine dealer, were
  eventually dropped as well.).  Mr. Munnerlyn spent over $85,000 in legal
  fees trying to get his plane back.  Though a Los Angeles jury awarded him
  the return of his airplane -- he had no knowledge that he was transporting
  drug money -- a U.S. District Judge reversed the jury's verdict.  Munnerlyn
  was forced to declare bankruptcy and is now forced to drive a truck for a
  living.  He eventually spent $7,000 to buy his plane back.  However, the
  DEA caused about $100,000 of damage.  The agency is not liable for the
  damage, and there is no way (4) that Mr. Munnerlyn can raise the money
  to re-start his business.

* A 61-year old California man, Donald Scott, was shot dead in front of his
  wife when 30 local, state, and federal agents attempted to serve him with
  a search warrant enabling them to inspect his 200-acre ranch in Malibu for
  cultivated marijuana.  He had brandished a handgun during the confusion of
  the early morning raid.  The Ventura County District Attorney's office
  found that:

     Upon receiving information from the informant, [Los Angeles County
     Sheriff's Deputy] Spencer originally thought that thousands of marijuana
     plants might be growing at the ranch.  Efforts to confirm the presence
     of marijuana were unsuccessful.  He was unable to see marijuana from the
     top of the waterfall and the Border Patrol did not see any plants during
     two attempts to do so. [DEA Special] Agent Stowell claimed to see only
     a relatively few plants, based solely on their color, but was unwilling
     to be the basis for a search warrant without corroboration.

     It is inherently unlikely that Agent Stowell could see marijuana plants
     suspended under trees in a densely vegetated area through naked-eye
     observations from 1000 feet.  His failure to take photographs is
     unexplained,and when the warrant was executed, no evidence of
     cultivation was found.  Based on all of the evidence, it is the
     District Attorney's conclusion that there was never marijuana being
     cultivated on the property as reported by Stowell.

  Real property used to cultivate marijuana may be forfeited under federal
  law. "It is the District Attorney's opinion that the Los Angeles County
  Sheriff's Department was motivated, at least in part, by a desire to
  seize and forfeit the ranch [adjacent to the Santa Monica Mountains
  National Recreation Area] for the government." (5)

* Police found five hundred marijuana plants growing on a retiree's 37-acre
  farm.  Delmar Puryear, who had retired with a disability and could not
  farm, insisted that he knew nothing about the plants.  A jury apparently
  believed him, finding him innocent of state criminal charges.  Despite
  this acquittal, the federal government refused to drop its efforts to
  seize the farm until Puryear agreed to pay $12,500. (6)

* Michael Sandsness owned two gardening supply stores in Eugene and Portland,
  Oregon.  Among the items sold were metal halide grow lights, which are
  used for growing indoor plants.  The grow lights can be used to grow
  marijuana, but it is not illegal in itself to sell them.  Because some
  marijuana gardens which were raided by the DEA had the lights, the agency
  began setting up a case to seize the business.  The DEA began sending
  undercover agents to the stores who tried without success to get employees
  to give advice on growing marijuana.  Finally, agents engaged in a
  conversation with an employee, and asked him for advice on the amount of
  heat or noise generated by the lights, making oblique comments suggesting
  they would want to avoid detection and making a comment about High Times
  magazine but never actually mentioning marijuana.  The employee then sold
  the agents grow lights.  The DEA then raided the stores, seizing inventory
  and bank accounts.  Agents approached the landlord of one of the stores
  and told him that if he did not evict the tenant, the building would be
  seized.  The landlord reluctantly evicted them.  While the forfeiture case
  was pending, the business was destroyed.  Sandsness was forced to sell
  the inventory not seized in order to pay off creditors. (7)

WHAT IS CIVIL ASSET FORFEITURE?

Civil forfeiture descends from a medieval English practice whereby an
object responsible for an accidental death was forfeited to the king,
who "would provide the [proceeds, the "deodand"] for masses to be said for
the good of the dead man's soul . . . or [would] insure that the deodand
was put to charitable uses."(8) The forfeiture is based on the legal fiction
that inanimate objects can themselves be "guilty" of wrongdoing.

All the government need show to justify a seizure is probable cause that the
property is subject to forfeiture.  Unlike criminal forfeiture, civil
forfeiture requires no antecedent criminal conviction of the property owner.
Even the acquittal of, the property's owner does not bar its forfeiture. (9)
Today, 80% of those who lose property to the government through civil
forfeitures are never charged with any crime. (10)  Since civil forfeiture
does not threaten deprivation of liberty, the government need not adhere to
the constitutionally required safeguards of criminal prosecutions.  In fact,
if the erstwhile property owner sues the government to get the property back,
he or she has the burden of proving that it is not subject to forfeiture.
In essence, the standard is guilty unless proven innocent!

Rarely used in America until recently, forfeiture has flourished as a weapon
in the war on drugs.  However, there are over 100 different federal
forfeiture statutes, both criminal and civil.  They range from the
forfeiture of animals seized from animal-fighting impresarios (11) and
cigarettes seized from smugglers (12) to property gotten from violations
of RICO (the Racketeer Influenced and Corrupt Organizations Act). (13)

The Comprehensive Drug Abuse Prevention and Control Act of 1970 contains the
federal anti-drug civil asset forfeiture provisions:

    (The Act provides for the forfeiture of] all controlled substances which
    have Open manufactured, distributed, dispensed, or acquired (14) . . .  [,]
    all raw materials, products, and equipment . . . which are used, or
    intended for use, in manufacturing . . . delivering, importing, or
    exporting [such] controlled substance[s] (15) . . . [all] property
    which is used, or intended for use, as a container for forfeitable
    controlled substances (16) . . .  [, and] all conveyances, including
    aircraft, vehicles, or vessels, which are used, or intended for use,
    to transport, or in any manner to facilitate the transportation, sale,
    receipt, possession or concealment [of such controlled substances.] (17)

In 1978, the Act was amended to provide for civil forfeiture of "[a]ll
moneys . . . or other things of value furnished or intended to be furnished
by any person in exchange for a controlled substance . . . [, and] all
proceeds traceable to such in exchange. (18) In 1984, the Act was amended
to provide for civil forfeiture of "all real property . . . which is used,
or intended to be used, in any manner or part, to commit or to facilitate
the commission of a violation (of the Act)." (19)

HOW MUCH MONEY DOES THE GOVERNMENT TAKE IN?

Prior to 1984, the money realized from civil forfeiture was deposited in the
general fund of the United States Treasury.  Now it primarily goes to the
Department of Justice's Asset Forfeiture Fund (with some going to the
Department of the Treasury's Forfeiture Fund). (20)  The money is then
used for forfeiture-related expenses and law enforcement purposes.

The amount deposited in the Department of Justice Assets Forfeiture Fund
has increased from $27 million in fiscal year 1985 to $531 million in
1992. (21)  Of the amount taken in 1992, $362 million was in cash and $114
million was in proceeds of forfeitable property; $230 million of the
total was returned to state and local law enforcement agencies who helped
in investigations. (22)  And $30 million in forfeited property was pressed
into official use by federal law enforcement agencies or transferred to
state and local law enforcement agencies. (23)  The Department now has
on hand an inventory in excess of 32,400 properties valued at more than
$1.8 billion. (24)  The U.S. Customs service seized property with a value
of over $708 million in fiscal year 1992. (25)

WHAT DOES THE CIVIL ASSET FORFEITURE REFORM ACT DO?

1) Switches Burden of Proof

Currently, it is the property owner, not the government, who is assigned the
burden of proof when he or she sues to try to get property back.  All the
government needs do is make an initial showing of probable cause that the
property is "guilty;" the property owner must then establish by a preponderance
of the evidence that the property is "innocent" or otherwise not subject to
forfeiture.  "This probable cause standard for seizure allows the government to
dispossess property owners based only upon hearsay or innuendo -- 'evidence' of
insufficient reliability to be admissible in a court of law." (26)  While it
has been argued that civil forfeiture is criminal (punitive) in nature and
therefore should require the government to prove its case, courts have not
accepted this argument. (27)

The Civil Asset Forfeiture Reform Act puts the burden of proof where it belongs.
The government would have to prove by clear and convincing evidence that the
property is subject to forfeiture -- that the unlawful act on which the
forfeiture is based actually occurred and that there is a sufficient nexus
between the property and the unlawful act. (28) The standard of clear and
convincing evidence is that standard used by the state of New York in its drug
forfeiture law. (29)  And it is the standard that the Supreme Court of Florida
ruled was mandated by the Florida Constitution's due process clause:
In forfeiture proceedings the state impinges on basic constitutional
rights of individuals who may never have been formally charged with any
civil or criminal wrongdoing.  This Court has consistently held that the
[Florida] constitution requires substantial burdens of proof where state
action may deprive individuals of basic rights. (30)

2) Provides for the Appointment of Counsel for Indigents

Currently, there is no constitutional right to appointed counsel in
civil forfeiture cases. (31)  This is one of the reasons why so few
forfeitures are challenged.

The Civil Asset Forfeiture Reform Act would provide representation of
counsel for whomever is financially unable to obtain representation to
challenge a federal civil forfeiture.  Maximum compensation would not
exceed $3,500 per attorney for representation before a U.S. district court
and $2,500 per attorney for representation before an appellate court
(equivalent to the maximums for appointed counsel in federal felony cases)."
(32)  These figures could be waived in cases of "extended or complex"
representation where "excess payment is necessary to provide fair
compensation and the payment is approved by the chief judge of the
circuit." (33)  Money will come from the Justice Assets Forfeiture Fund.

3) Protects Innocent Property owners

Real property used to commit or to facilitate a federal drug crime is
forfeitable unless the violation was "committed or omitted without the
knowledge or consent of (the) owner." (34)  This is of course meant to
protect innocent owners.  However, a number of federal courts have
seriously eroded the provision's protections by ruling that the owner must
have both had no knowledge of and provided no consent to the prohibited
use of the property. (35)  Such an interpretation would mean that property
owners such as Jesse Bunch would be out of luck. (36) Mr. Bunch owned a
bar and residential apartments in a highly active drug trafficking area.
He did know of drug selling activity, but took many steps to prevent it.
He fired two bartenders after they were arrested at the bar for drug
violations, evicted two residents following their arrests, restricted use
of the restrooms, posted signs advising patrons that they were subject to
search and seizure, restricted the bar's hours of operations and
periodically called police to report drug activity in the vicinity of
his property.  However, drug activity continued and the government
seized the property.

Luckily for Mr. Bunch, the court ruled that he was protected by the
innocent owner defense because of his lack of consent to the illegal
drug trafficking and his reasonable efforts to put it to an end.
"Mr.  Bunch, who was trying to eke out an income from a business located in
a drug-infested area that posed great risks to the safety of him and his
family . . . fulfilled his legal obligation." (37)  This is only fair,
and should be the proper interpretation of the innocent owner defense.  The
Civil Asset Forfeiture Reform Act would clarify that lack of consent to
(including reasonable efforts to prevent) illegal activity is a valid
defense to forfeiture by a property owner.

4) Eliminates the Cost Bond Requirement

Currently, a property owner wanting to contest the seizure of property
must give the court a bond of the lesser of $5,000 or 10% of the value of
the property seized (but not less than $250). (38)  This money will go to
cover court and storage costs should the government win.  The cost bond
requirement is unconstitutional as applied to indigent claimants (39) and
serves little purpose in other cases:

     There is no reason why a person whose property is seized by the
     government should have to post a bond to defray some of the government's
     litigation and storage expenses in order to have the right to a day in
     court to contest the forfeiture.  Currently, over 80% of federal
     forfeitures are not being contested.  One reason why so many forfeitures
     are not contested is the high cost of retaining counsel to defend a
     forfeiture action.  The cost bond requirement is simply an additional
     financial burden on the claimant and an added deterrent to contesting
     the forfeiture . . . . (40)

The Civil Asset Forfeiture Reform Act would abolish the cost bond requirement.

5) Provides a Reasonable Time Period for Challenging a Forfeiture

Currently, if a property owner wants to challenge a forfeiture, he or she
must "file his claim within 10 days after process has been executed." (41)
This time period is woefully inadequate:

     Even assuming that notice is published the next day after process is
     executed, the reader of the notice will have a mere nine days to file
     a timely claim.  Most local rules require that notice be published for
     three successive weeks, on the assumption that interested parties will
     not necessarily see the first published notice.  But by the time the
     second notice is published, more than ten days will have elapsed from
     the date process was executed.  Thus anyone who misses the first
     published notice will be unable to comply with the exceedingly short
     time limitation for filing a claim. (42)

Even though this time limit is sometimes ignored in the interests of justice,
failure to file a timely claim can result in judgment in favor of the
government.

The Civil Asset Forfeiture Reform Act would lengthen this period to 60 days.

6) Provides a Remedy for Property Damage Caused by Government Negligence

Currently, the federal government is exempted from liability under the
Federal Tort Claims Act for damage caused by the negligent handling or
storage of property detained by law enforcement officers. (43)  Property
awaiting forfeiture often devalues in value:

     Seized conveyances devalue from aging, lack of care, inadequate storage,
     and other factors while awaiting forfeiture.  They often deteriorate --
     engines freeze, batteries die, seals shrink and leak oil, boats sink,
     salt air and water corrode metal surfaces, barnacles accumulate on boat
     hulls, and windows crack from heat.  On occasion, vandals steal or
     seriously damage conveyances. (44)

Vacant and boarded-up real property is especially subject to deterioration.
And sometimes, government agents utterly destroy property in futile searches
for contraband.

The Civil Asset Forfeiture Reform Act would simply allow property owners to
sue the government for negligence.

7) Allows for the Return of Property Pending Final Disposition of a Case

Currently, customs law does allow for the release of property pending final
disposition of a case upon payment of a full bond. (45)  However, a property
owner who cannot afford to secure such a bond is out of luck.  Especially
when the property is used in a business, its lack of availability for the
time necessary to win a victory in court can force an owner into bankruptcy.
often, the property owner must settle with the government for some sum to
get property back despite the government having an extremely weak case.

The Civil Asset Forfeiture Act specifies that property can be released if
continued possession by the government would cause the claimant substantial
hardship.  However, conditions may be placed on release as are appropriate
to preserve the availability of the property or its equivalent for
forfeiture should the government eventually prevail.

DOES THE CIVIL ASSET FORFEITURE REFORM ACT AFFECT STATE FORFEITURE LAWS?

At least 45 states have adopted their own forfeiture laws.  The Civil Asset
Forfeiture Reform Act would not directly affect these statutes.  However,
the bill would discourage the practice known as "adoptive forfeiture."
Under adoptive forfeiture, state law enforcement officers seize property
under state law and bring it to a federal agency for federal forfeiture
(provided that a violation of federal law has occurred and the property
is forfeitable under federal law).  The feds then return 85% of the net
proceeds to the state or local agency that initiated the case.  Adoptive
forfeiture is often relied upon to circumvent state laws allocating
forfeited assets to non-law enforcement uses.  For example, in Missouri,
all forfeited funds go to the state's general fund. (46)  Since the Civil
Asset Forfeiture Reform Act would make the procedural going rougher for
the government in federal court, many state official would presumably decide
to stick with their state courts.  The result would be more money going to
education, drug treatment, and other services funded by forfeiture under
state laws.

Enactment of the Civil Asset Forfeiture Reform Act would also take away the
ability of state law enforcement officials to seize property under federal
law to get around state procedural safeguards.

= = = = = = = = = Footnotes = = = = = = = = = =

1  The Drug Enforcement Administration routinely pays out 10% of any money
   seized in reward of tips such as this.  In 1990, the Justice Department
   paid out a total of $24 million.  See Government Seizures Victimize
   Innocent, Pittsburgh Press, Aug.  11, 1991.

2  Id.

3  See Florida Man's Plight Sparks Customs Service Bill, United Press Inter.,
   March 13, 1992; Marston, Customs Destroys Boat and a Dream, St. Petersburg
   Times, Feb. 5, 1993.  Mr.  Klein was later awarded $8,900 through private
   legislation introduced by Representative Charles Bennett.

4  Related by Brenda Grantland of Mill Valley, California.  Ms. Grantland is
   general counsel to FEAR (Forfeiture Endangers American Rights).  See also
   Miniter, Property Seizures on Trial, Insight, Feb. 22, 1993, at 10, 33.

5  See Office of the District Attorney, County of Ventura, State of
   California, Report on the Death of Donald Scott (1993).

6  See Police Work or Piracy?, Louisville Courier-journal, Oct. 6, 1991.

7  Related by Brenda Grantland, supra note 4.

8  Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S.  663, 681 n.16 (1974).

9  In United States v. One Assortment of 89 Firearms, 465 U.S. 354 (1984),
   the Supreme Court ruled that a civil forfeiture action following a
   criminal acquittal does not constitute double jeopardy.

10 See Government Seizures victimize Innocent, supra note

11 See 7 U.S.C. sec. 2156.

12 See 18 U.S.C. sec. 2344.

13 See 18 U.S.C. sec. 1963.

14 21 U.S.C. sec. 881(a)(1).

15 21 U.S.C. sec. 881(a)(2).

16 21 U.S.C. sec. 881(a)(3).

17 21 U.S.C. sec. 881(a)(4).

18 Psychotropic Substances Act of 1978 (found at 21 U.S.C sec 881(a)(6)).

19 The Comprehensive Crime Control Act of 1984 (found at 21 U.S.C. sec.
   881(a)(7)).

20 See 28 U.S.C.  Sec. 524(c)(4).

21 See U.S. Department of Justice, Asset Forfeiture Fact Sheet (1993).

22 See U.S. Department of Justice, Assets Forfeiture Fund Statement of
   Income and Expenses (1993).

23 See id.

24 See Fact Sheet, supra note 21.

25 See U.S. Customs Service, U.S. Customs Update: 1992 22.

26 Reed, American Forfeiture Law: Property Owners Meet the Prosecutor 3
   (CATO Institute Policy Analysis No. 179, 1992).

27 See Stahl, Asset Forfeiture, Burdens of Proof and the War on Drugs,
   83 J. Crim.  L. & Criminology 274 (1992).

28 The bill amends 19 U.S.C. sec. 1615.  Most federal forfeiture statutes
   rely on this provision of our customs law to set the burden of proof.

29 See N.Y. CPLR sec. 1311(3).

30 Department of Law Enforcement v. Real Property, 588 So.2d 957, 967
   (Fla. 1991).

31 Before Lassiter v. Department of Social Services, 452 Ii. S.  18 (1981),
   a constitutional right to appointed counsel was only recognized in cases
   where a litigant might lose his or her physical liberty.  While Lassiter
   set up a balancing test in other situations, the Alaska Supreme Court in
   Resek v. State, 706 P.2d 288 (Alaska 1985), rejected the argument that
   counsel should be appointed in civil forfeiture cases.

32 See 18 U.S.C. sec. 3006A(d)(2).

33 18 U.S.C. sec. 3006A(d)(3).

34 21 U. S. C. sec. 881 (a) (7) .

35 See, e.g.. United States v. Lot 111-B.  Tax Map Key 4-4-03-71(4),
   902 F.2d 1443 (9th Cir. 1990).

36 See United States v. All Right, Title & Interest in Property Known as
   710 Main St., Peekskill, N.Y., 744 F. Supp. 510 (S.D.N.Y. 1990).

37 United States v. All Right, Title & Interest in Property Known as
   710 Main St., Peekskill, N.Y., 753 F. Supp. 121, 125 (S.D.N.Y. 1990).

38 See 19 U.S.C. sec. 1608.

39 See Wiren v. Eide, 542 F.2d 757, 763-64 (9th Cir. 1976).

40 Letter from David Smith to Ms. Kathleen Clark, Senate Judiciary Committee
   (Aug. 19, 1992).

41 Supplemental Rule of Civil Procedure for Certain Admiralty and Maritime
   Claims C(6).  This is the date when a U.S. court takes possession of
   the property through "arrest" by a federal marshall.  It is not the date
   when it is initially seized by a law enforcement officer.

42 Smith, Prosecution and Defense of Forfeiture Cases sec.  9.03(1).

43 See Kosak v. United States, 465 U.S. 848 (1984).

44 United States General Accounting office, Better Care and Disposal of
   Seized Cars, Boats, and Planes Should Save Money and Benefit Law
   Enforcement ii (GAO/PLRD-83-94, 1983).

45 See 19 U.S.C. sec. 1614.

46 See Mo. Ann. Stat. sec. 513.623.

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End of Computer Underground Digest #5.48
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