Asset Forfeiture – Money Laundering

FraudsWatch.com
White-Collar Crime

<h2 class&equals;"graphicboxheader">Asset Forfeiture<&sol;h2>&NewLine;<figure id&equals;"attachment&lowbar;16752" aria-describedby&equals;"caption-attachment-16752" style&equals;"width&colon; 336px" class&equals;"wp-caption alignright"><a href&equals;"https&colon;&sol;&sol;www&period;fraudswatch&period;com&sol;white-collar-crime1&sol;" rel&equals;"attachment wp-att-15098"><img class&equals;"wp-image-16752" src&equals;"https&colon;&sol;&sol;www&period;fraudswatch&period;com&sol;wp-content&sol;uploads&sol;2015&sol;10&sol;White-Collar-Crime1-1&period;jpg" alt&equals;"White-Collar Crime" width&equals;"336" height&equals;"224" &sol;><&sol;a><figcaption id&equals;"caption-attachment-16752" class&equals;"wp-caption-text"><em><strong>White-Collar Crime<&sol;strong><&sol;em><&sol;figcaption><&sol;figure>&NewLine;<p>Many criminals are motivated by greed and the acquisition of material goods&period; Therefore&comma; the ability of the government to forfeit property connected with criminal activity can be an effective law enforcement tool by reducing the incentive for illegal conduct&period; Asset forfeiture &OpenCurlyDoubleQuote;takes the profit out of crime” by helping to eliminate the ability of the offender to command resources necessary to continue illegal activities&period;<&sol;p>&NewLine;<p>The use of asset forfeiture in criminal investigations aims to undermine the economic infrastructure of the criminal enterprise&period; Criminal enterprises in many ways mirror legitimate businesses&period; They require employees&comma; equipment&comma; and cash flow to operate&period; Criminal enterprises also generate a profit from the sale of their &OpenCurlyDoubleQuote;product” or &OpenCurlyDoubleQuote;services&period;” The obvious difference is that the profit generated from criminal enterprises is derived from criminal activity&period; Asset forfeiture can remove the tools&comma; equipment&comma; cash flow&comma; profit&comma; and&comma; sometimes&comma; the product itself&comma; from the criminals and the criminal organization&comma; rendering the criminal organization powerless to operate&period;<&sol;p>&NewLine;<p>Asset forfeiture is also the most effective means of recovering property and funds which can then be used to compensate innocent victims&period; Restoration of property to victims in white collar cases is the first priority of law enforcement when it comes to disbursing forfeited property&period; Much time and effort is expended in such cases to ensure that the wrongdoer’s assets are preserved pending trial&comma; so they remain available for this purpose once the case is settled&period;  While most people associate forfeiture with the activity of drug trafficking groups&comma; the FBI’s white collar crime program is the largest contributor to the FBI’s forfeiture program&period;<&sol;p>&NewLine;<p>To accomplish its goals&comma; the Bureau provides training&comma; resources&comma; and operational assistance to local FBI field offices&comma; entities at FBI Headquarters&comma; state and local law enforcement&comma; and our international partners to ensure that asset forfeiture is incorporated into as many investigations as possible&comma; where appropriate and allowed by law&comma; to deter criminal activity and dismantle criminal enterprises&period;<&sol;p>&NewLine;<h3><b>Law Origins<&sol;b><&sol;h3>&NewLine;<p>The seizure of property is a practice long used by governments&period; For example&comma; in English common law&comma; the value of an inanimate object could be forfeited to the English Crown if that object caused the death of a person&period; Therefore&comma; the forfeiture of property was generally justified as a penalty for carelessness&period; This tradition and justification has&comma; over time&comma; merged with a belief that the right to own property could be denied an individual who engaged in criminal conduct&period;<&sol;p>&NewLine;<p>The forfeiture sanction is a legal concept that involves the application of procedures resulting in the transfer of the ownership of property to the government&period; Many of the criminal laws enforced by the Federal Bureau of Investigation &lpar;FBI&rpar; contain forfeiture provisions&period; Some of these forfeiture provisions are excellent deterrents&comma; for example&comma; forfeiture under federal drug laws and under money laundering laws&period;<&sol;p>&NewLine;<p>The seizure of property by law enforcement authorities generally is permissible when the property is evidence of a crime or is subject to forfeiture&period; The seizure of property for forfeiture implicates tenets of the Fourth and Fifth Amendments of the United States Constitution&period; The proper method of seizure of property&comma; for example in a civil forfeiture action&comma; depends upon the methods permitted in the relevant statute&comma; the location of the property&comma; Department of Justice and FBI policy&comma; and whether or not exigent circumstances are present&period; It is FBI policy to seize property for forfeiture pursuant to a seizure warrant&period;<&sol;p>&NewLine;<h3><b>Types of Forfeiture Actions<&sol;b><&sol;h3>&NewLine;<p>There are two types of forfeiture actions&colon; criminal and civil&period; The criminal forfeiture action is referred to as an <i>in personam<&sol;i> action&comma; meaning that the action is against the person&comma; and&comma; that upon conviction&comma; the punitive effect of forfeiture can be used against the convicted offender&period; The civil forfeiture action is referred to as an <i>in rem<&sol;i> action&comma; meaning that the action is against the property&period; The two actions differ in many ways&comma; including&colon; &lpar;1&rpar; the point in the proceeding&comma; generally at which the property may be seized&semi; &lpar;2&rpar; the burden of proof necessary to forfeit the property&semi; and &lpar;3&rpar; in some cases&comma; the type of property interests that can be forfeited&period;<&sol;p>&NewLine;<h3><b>Criminal Forfeiture Actions<&sol;b><&sol;h3>&NewLine;<p>A criminal forfeiture action must be judicial&period; The property subject to forfeiture is named in the same indictment that charges the defendant with a criminal violation&period; The jurisdiction of the court over the defendant provides the court with jurisdiction over the defendant’s property interests&period; While there is some disagreement among the appellate courts&comma; generally&comma; the government must meet the legal standard of proof&comma; beyond a reasonable doubt&comma; necessary to convict the defendant in order to forfeit the property&period; The property may be forfeited in this manner only if the defendant is convicted of the underlying offense charged&comma; and the trier of fact finds that the property named in the indictment was illegally tainted&period;<&sol;p>&NewLine;<p>As a general rule&comma; the seizure of the property through criminal forfeiture may not occur until after the property has been forfeited&period; The district court then issues an order to seize the property&comma; and the seizure is made by the U&period;S&period; Marshal Service&period; There are some exceptions to this rule&period; For example&comma; a seizure warrant may be used in certain circumstances in a criminal forfeiture matter under the Controlled Substances Act &lpar;CSA&rpar; and under the Money Laundering Control Act &lpar;MCLA&rpar;&period; Criminal forfeiture laws provide for a post-forfeiture hearing by the court&comma; called an ancillary hearing&comma; to consider the claims of third parties to the forfeited property&period;<&sol;p>&NewLine;<p>Criminal forfeiture provisions such as those found in the Racketeer Influenced and Corrupt Organizations Act &lpar;RICO&rpar; and CSA identify property that can be forfeited upon conviction of a defendant in broader terms than the provisions of law concerning most civil forfeitures&period; Criminal forfeiture laws name interests subject to forfeiture that are more complex&comma; including property acquired or maintained in violation of RICO&comma; and various types of legal interests in property that have afforded a source of influence over the illegal enterprise&period; The civil forfeiture laws generally name specific property that is integrally connected with prohibited activity&comma; including conveyances used&comma; money furnished&comma; and real property used&period;<&sol;p>&NewLine;<h3><b>Civil Forfeiture Actions<&sol;b><&sol;h3>&NewLine;<p>A civil forfeiture action is effected through either a summary&comma; administrative&comma; or judicial procedure&period; A summary forfeiture procedure is limited to the CSA and then only to a narrow category of property&period;<&sol;p>&NewLine;<h3><b>Administrative Forfeiture<&sol;b><&sol;h3>&NewLine;<p>An administrative forfeiture procedure can be commenced by a seizing agency against most property if it is valued at &dollar;500&comma;000 or less&comma; unless the property is a monetary instrument&comma; in which case there is no maximum monetary limit&period; If the administrative action is not contested in a timely manner&comma; any legal claim to the property is thereafter barred and the agency may declare the property forfeited&period;<&sol;p>&NewLine;<p>An administrative action can be contested by the filing of a claim of ownership&period; A timely claim to the property forces the government to terminate the administrative forfeiture action and to commence a civil judicial action&period;<&sol;p>&NewLine;<h3><b>Judicial Forfeiture<&sol;b><&sol;h3>&NewLine;<p>If a claim has been filed in a timely manner&comma; the FBI must transmit it to the U&period;S&period; Attorney and the administrative forfeiture must cease&period; If the property subject to forfeiture is not a monetary instrument or a hauling conveyance&comma; and is valued over &dollar;500&comma;000&comma; the proceedings must commence as a judicial action&period; In addition&comma; if the forfeiture action is against real property&comma; the proceedings must be judicial&comma; regardless of the value of the property&period;<&sol;p>&NewLine;<h3><b>Burden of Proof<&sol;b><&sol;h3>&NewLine;<p>The burden of proof on the FBI to seize property for civil&comma; administrative and judicial forfeiture is probable cause&period; This burden must be met to satisfy both statutory and constitutional requirements&period; A civil forfeiture action commences upon notification by mail and publication of the government’s intent to forfeit the property&period;<&sol;p>&NewLine;<p>Probable cause for an administrative forfeiture is defined as a reasonable ground for belief of guilt&comma; supported by less than prima facie proof&comma; but more than mere suspicion&period;<&sol;p>&NewLine;<p>The initial burden of proof in a judicial action is also probable cause&period; After seizure&comma; the United States Attorney’s Office must make an independent determination of whether the property can be forfeited&period; After finding the forfeiture action has merit&comma; a verified complaint must be filed&comma; in effect&comma; charging the property with violating the law&period; The burden is then on the government to prove the property is subject to forfeiture by a preponderance of the evidence&period; Preponderance of the evidence is defined as &OpenCurlyDoubleQuote;superior evidentiary weight that&comma; though sufficient to free the mind wholly from all reasonable doubt&comma; is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other&period;”<&sol;p>&NewLine;<p>It should be remembered that a civil judicial forfeiture action is a civil proceeding&comma; rather than a criminal proceeding&comma; so the Federal Rules of Civil Procedure are applicable&period; Discovery processes under these rules are different than those found in criminal procedures&period;<&sol;p>&NewLine;

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