Tag Archives: civil forfeiture

Michigan court rules against civil forfeiture

Good news: The Michigan Court of Appeals has ruled that civil forfeiture denies citizens their due process rights under the Constitution. As the court wrote:

“Because of her indigency and inability to pay the required bond, [Kinnon] was excluded ‘from the only forum effectively empowered to settle [her] dispute.’ … Ultimately, Michigan’s civil asset forfeiture scheme operated to deprive [Kinnon] of a significant property interest without according her the opportunity for a hearing, contrary to the requirements of the Due Process Clause.”

This shouldn’t be rocket science, as the language and intent of the Fifth Amendment to the Constitution is quite plain.

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 offence 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.

The problem today is that this has become rocket science. Too many people either don’t know this plain language, or work dishonestly to distort it to empower government to oppress us.

Republicans in Congress move to limit civil forfeiture

A Republican bill now moving through both houses of Congress will place some limits on the ability of state and federal governments to confiscate private property.

The bills most important provision will be to shift the burden of proof to the government, not the citizen. However,

Unfortunately, while the DUE PROCESS Act contains many of the procedural reforms that The Heritage Foundation and a broad coalition of organizations have called for in our recent Meese Center report, “Arresting Your Property,” it does not tackle two of the most perverse aspects of forfeiture law: the financial incentives that underlie modern civil forfeiture practices and the profit-sharing programs known as “equitable sharing.”

Under federal law, 100 percent of the proceeds of successful forfeitures are retained by the federal law enforcement organization that executed the seizure. This money is available to be spent by these agencies without congressional oversight, meaning they can—and do—self-finance. This profiteering incentive is extended to state and local agencies through programs administered by the Justice and Treasury departments known as “equitable sharing,” which allow property seized at the state and local level to be transferred to federal authorities for forfeiture under federal law. The feds then return up to 80 percent of the resulting revenues to the originating agency.

Thus, federal law provides every law enforcement agency in the country with a direct financial incentive to seize cash and property—sometimes at the expense of investigating, arresting, and prosecuting actual criminals—and simultaneously encourages state and local agencies to circumvent state laws that are more protective of property rights or restrictive as to how forfeiture proceeds may be spent than the federal standard.

The simple fact is that civil forfeiture is already blatantly illegal, as per the plain words in the fifth amendment to the Constitution:

No person . . .[shall] be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

It is a horrible tragedy that so few people today respect these plain words.

IRS steals millions from people for depositing the wrong amount of money

Theft by government: IRS has confiscated $43 million from more than 600 innocent individuals merely because they did large cash transactions just under $10K.

The law in question forbids people from purposely breaking up deposits so that they are under $10,000 in order to avoid reporting the deposit to the government, and was originally written to target drug dealers. Instead, the government has been using it as a convenient way to steal people’s money.

After issuing a Freedom of Information Act request to the IRS, the Institute for Justice found 618 cases from 2007 to 2013 where the IRS seized funds without evidence of underlying criminal wrongdoing. When the Institute for Justice requested more information about these cases, the IRS said the group would have to pay a quarter million dollar fee because the request fell into the category of “commercial use.”

According to [Robert Johnson, lawyer for one individual whose bank account was seized], the IRS is still harassing small business owners because of their bank deposits despite the 2015 rule change [that supposedly required evidence of criminal activity before confiscation]. “Shockingly, when the IRS engages in such tactics, it can use the money that it takes to pad its own budget,” Johnson said. “When the IRS uses civil forfeiture to take money for structuring violations, the money is deposited in the Treasury Forfeiture Fund. In other words, the money that the IRS takes from hardworking Americans can be put back to work to seize money from additional Americans,” he said.

Read it all. The IRS has admitted that the individuals from whom they seized this money had committed no crime. Yet they still refuse to return the money.

Florida passes law outlawing theft by government

Good news: Florida’s Republican governor today signed a law that forbids state police from seizing any property from any citizen unless they actually arrest and charge that person with a crime.

The big deal with this particular reform is that, in most cases, Florida police will actually have to arrest and charge a person with a crime before attempting to seize and keep their money and property under the state’s asset forfeiture laws. One of the major ways asset forfeiture gets abused is that it is frequently a “civil”, not criminal, process where police and prosecutors are able to take property without even charging somebody with a crime, let alone convicting them. This is how police are, for example, able to snatch cash from cars they’ve pulled over and claim they suspect the money was going to be used for drug trafficking without actually finding any drugs.

I should also note that getting this law written and passed was spear-headed by the Republicans in Florida’s legislature, though Democrats there also supported it. I note this not to imply that Republican politicians are great, which they routinely are not, but to note that of the two parties, in recent years it has generally been the Republicans who have opposed asset forfeiture, which I like to call theft-by-government.

Sadly, the Republicans were key players in getting this kind of policy legalized in the first place.

In both cases, it is really the voters who to blame, or to be credited. When the laws were passed allowing police the right to confiscate private property, the voters cheered, thinking such actions would help stop the drug trade (which they were encouraging by buying the drugs). Politicians responded to the voters, and passed the laws, tweaking them as power-hungry politicians do to make them work to the government’s favor, not the citizens. Now, having realized how bad these laws are, the voters are electing politicians who want to remove the laws. That pressure is resulting in laws like this.

Milton Friedman explained this process quite wisely many years ago.

Secret Service tries to steal $115K from a business couple

Theft by government: The Secret Service seized a business couple’s bank account with no warning merely because they had withdrawn just under $10,000 several times.

After months of litigation against the United States government, Assistant U.S. Attorney Stephen West moved to dismiss the case earlier this month, meaning the Bednars will get their money back. However, the government refused to cover the Bednar’s $25,000 in legal fees, which the couple is entitled to under the Civil Asset Forfeiture Reform Act. Though the fight to get their $115,000 back is now over, the family is continuing to push to have their expenses covered. [emphasis mine]

First the government tries to steal their money. Now, it is trying to ignore the law by not paying their legal fees, even though the law requires it to.

But hey, we all know the best solution to all our problems is the government!

DEA steals life savings of innocent man

Theft by government: In another example of civil forfeiture, DEA agents confiscated the life savings of a man heading to California based on no evidence.

There was no evidence of a crime, the man was never charged, but three weeks later he still has not gotten his money back.

Sean Waite, the agent in charge for the DEA in Albuquerque, said he could not comment on the Rivers case because it is ongoing. He disputed allegations that Rivers was targeted because of his race. Waite said that in general DEA agents look for “indicators” such as whether the person bought an expensive one-way ticket with cash, if the person is traveling from or to a city known as a hot spot for drug activity, if the person’s story has inconsistencies or if the large sums of money found could have been transported by more conventional means.

“We don’t have to prove that the person is guilty,” Waite said. “It’s that the money is presumed to be guilty.” [emphasis mine]

Read the whole article. This is entirely unconstitutional. The fifth amendment to the Bill of Rights expressly forbids the taking of private property “without just compensation.”

But hey, the obvious solution is to give the federal government more power! That’s what Obama and Al Sharpton want. They must be right!

IRS steals widow’s savings

Theft by government: The IRS has seized nearly $19,000 of a widow’s savings because it didn’t like the manner in which she deposited it in the bank.

After [an October policy change that was supposed to stop most of these kinds of cash confiscations], federal prosecutors in Iowa agreed to return money the IRS seized from two people accused of structuring, including a restaurant owner who had $33,000 taken and a doctor who fought to get back $344,000 in earnings from his medical practice. But prosecutors declined to drop the civil forfeiture case over $18,775 the IRS seized from [the widow Janet] Malone.

Instead, they added a misdemeanor criminal charge last week alleging she willfully violated the law, after her husband had been warned about the practice four years ago. Malone is expected to plead guilty next week and let the government keep the money, under a plea agreement filed Monday. The charge carries up to one year in jail and a $250,000 fine.

Note that in every one of these cases, no actual crime was every committed. The money was earned legally. The only issue was the manner in which the individuals deposited the money. The IRS didn’t like it.

The government as thief

How civil forfeiture is used by government agencies to steal cash and property from innocent Americans.

More here, including this juicy story:

To the casual observer it appears that Virginia is run by violent psychopaths. That’s the takeaway from the recent report of an anti-poker SWAT team raid in Fairfax County, in which eight assault rifle-sporting police officers moved against ten card-playing civilians. The police possibly seized more than $200,000 from the game, of which 40 percent they eventually kept.

There was no indication that any of the players was armed. As a matter of fact, it appears that a gambler is more likely to be shot without provocation by the Fairfax Police than the other way around. The heavy firepower at the Fairfax raid was apparently motivated by the fact that “at times, illegal weapons are present” at such poker games, and that “Asian gangs” have allegedly targeted such events in the past. This is, then, a novel approach to law enforcement: as a matter of policy, Fairfax police now attempt to rob and steal from people before street gangs get around to doing it.

As the article notes, gambling is not against the law in Virginia, merely regulated. It appears that this regulation was used as a very flimsy excuse by the Virginia state government to rob these citizens and pocket the cash.

Paul introduces bill to rein in government property seizures

Good news: A new bill introduced this week by Senator Rand Paul (R-Kentucky) would put strict limits on the use of civil forfeiture by both state and federal agencies.

I normally don’t post links to stories about bills that have merely been introduced, not passed, but I think the trend that this bill indicates is important. It was only a short time ago that politicians ran around touting their achievements in establishing civil forfeiture laws. Now the cool place for politicians to be is to show how they are acting to end this practice.

Massive federal/state program uncovered to track millions of cars nationwide

What could possibly go wrong? A massive federal/state government partnership has been built to track the movements of millions of cars as they move across the country.

The program is also linked to a number of databases that provide a significant amount of private information about the drivers of those cars. The program has also been designed to aid state and federal officials in their efforts to grab cash and property from citizens in their civil forfeiture programs.

Doesn’t that make you feel safe?

Holder’s end to federal property seizure ban exaggerated

Pigs land: A close look at Eric Holder’s announcement on Friday that he was ending the use of federal law to seize private property turns out to be greatly exaggerated.

Holder’s order applies only to “adoption,” which happens when a state or local agency seizes property on its own and then asks the Justice Department to pursue forfeiture under federal law. “Over the last six years,” the DOJ says in the press release announcing Holder’s new policy, “adoptions accounted for roughly three percent of the value of forfeitures in the Department of Justice Asset Forfeiture Program.” By comparison, the program’s reports to Congress indicate that “equitable sharing” payments to state and local agencies accounted for about 22 percent of total deposits during those six years. That means adoptions, which the DOJ says represented about 3 percent of deposits, accounted for less than 14 percent of equitable sharing. In other words, something like 86 percent of the loot that state and local law enforcement agencies receive through federal forfeitures will be unaffected by Holder’s new policy.

The story also notes how the press, especially the Washington Post which led with this story, teamed up with Holder to overstate the impact Holder’s order would have.

Holder’s action is still in the right direction. He just didn’t go very far, which makes perfect sense considering the generally corrupt and oppressive nature of the Justice Department since he took it over. Initially I thought pigs were flying by his announcement. Now I know they can’t.

Holder bars use of federal law to seize private property

Good news: Attorney General Eric Holder on Friday barred state and local police from using federal law to seize any private property unless an actual crime is being committed.

Holder’s decision allows some limited exceptions, including illegal firearms, ammunition, explosives and property associated with child pornography, a small fraction of the total. This would eliminate virtually all cash and vehicle seizures made by local and state police from the program. While police can continue to make seizures under their own state laws, the federal program was easy to use and required most of the proceeds from the seizures to go to local and state police departments. Many states require seized proceeds to go into the general fund.

A Justice official, who spoke on the condition of anonymity in order to discuss the attorney general’s motivation, said Holder “also believes that the new policy will eliminate any possibility that the adoption process might unintentionally incentivize unnecessary stops and seizures.”

As much as I think Holder has been a dishonest and corrupt attorney general who has used his power to attack his political opponents, this decision by him should be lauded highly. It was the right thing to do.

Police seize $100K without a warrant

Theft by government: Two men who were detained, their car searched without a warrant, and had more than $100K in cash seized illegally, have now filed suit claiming their constitutional rights were violated.

By the time the encounter was over, the gamblers had been detained for more than two hours. Their car was searched without a warrant. And their cellphones, a computer and $100,020 of their gambling “bankroll” were seized under state civil asset-forfeiture laws. The troopers allowed them to leave, without their money, after issuing a traffic warning and a citation for possession of marijuana paraphernalia that carried a $65 fine, court records show.

Months later, an attorney for the men obtained a video of the stop. It showed that the motorists were detained for a violation they did not commit — a failure to signal during a lane change — and authorities were compelled to return 90 percent of the money.

Now the men are questioning the police tactics in an unusual federal civil rights lawsuit. In the suit, filed Sept. 29, William Barton Davis, 51, and John Newmer­zhycky, 43, both from Humboldt County, Calif., claim their constitutional rights against unreasonable searches and seizures were violated. They also contend the stop was part of a pattern connected to the teachings of a private police-training firm that promotes aggressive tactics.

I hope they win big, very big. As far as I can tell, there is nothing legal about this police action. Nothing. It is theft, pure and simple, and thieves are supposed to be punished if caught.

Two Republican senators propose limiting ability of government to confiscate property

Theft by government: Chuck Grassley (R-Iowa) and Rand Paul (R-Kentucky) are both proposing limits to the federal government’s ability to confiscate private property.

Since these confiscations are essentially unconstitutional and illegal, “limiting” the government’s ability here to me seems to be a weak response. These confiscations should cease entirely, now. Still, at least these Republicans are making sounds they want to do something about this fascist behavior.

A store owner’s entire bank account was seized by the IRS, even though he was not charged with any crime and had recently passed an audit.

Theft by government: A store owner’s entire bank account was seized by the IRS, even though he was not charged with any crime and had recently passed an audit.

The government falsely accused me of violating federal banking laws by making frequent cash deposits of less than $10,000. It is illegal to make deposits of less than $10,000 in cash if you are doing it to avoid regulations that require the banks to report larger deposits to the IRS. It’s not against the law, though, to make smaller deposits when there is a legitimate, legal business reason. That is exactly what I have been doing. My clerks routinely deposited cash earned at Schott’s at a bank right across the street. It’s never a good idea to risk letting too much money accumulate on-site. Like many other small businesses, my store’s insurance policy specifically limits coverage for cash losses to $10,000. The government would have learned that if it asked me, but it didn’t.

Just last year, we were audited by the IRS to make sure we complied with “anti-money-laundering” laws. The IRS gave us a clean bill of health. Our store has been making deposits this way for decades, and the IRS looked through our books during the audit. Yet no one said anything to me about violating any law. The IRS even sent me a letter about their audit saying, “No violations were identified.” Without any warning, officials just cleaned out my bank account.

Remarkably, the government doesn’t even have to charge me with any wrongdoing to keep my money. Many people know about criminal forfeiture, which allows police to seize the ill-gotten gains of convicted criminals. In my case, the government used civil forfeiture, which lets the government take money from people who have never been charged with any crime. Adding insult to injury, federal civil forfeiture law does not even grant me a hearing before or soon after they snatched my account. They’ve had my money for 10 months. I’ve been forced to spend thousands of dollars on lawyers just to get a hearing before a judge. Even more bizarre, under civil forfeiture, the government’s case is not against me, but against my property. This is why the official case has the ridiculous name, United States of America v. $35,651.11 in U.S. Currency. This is not just absurd; it’s unconstitutional.

Understand that the IRS could do this to anyone, without justifying their position in the slightest. And keep the money.

Posted on the road in New Mexico.