Tag Archives: Asset Forfeiture

Wyoming’s New Asset Forfeiture Law Could Set A Game-Changing Precedent

By Casey Harper – Civil asset forfeiture is a practice in which police can seize property and keep it even if they don’t convict or charge the owner with a crime. Then, the owner must go through the legally arduous, and often unsuccessful process to recoup their property – whether it’s a vehicle, cash or home – from the police. The Institute for Justice, an organization pushing for forfeiture reform, rated Wyoming with a D- for their forfeiture laws.

So reform advocates have worked to implement laws in states across the country that require a conviction before property is forfeited. National reform leaders also want more reporting and accountability for law enforcement to prevent frivolous seizures.

In 2015, Wyoming’s legislature passed a civil asset forfeiture reform bill that was a dream come true for reform advocates. It was so strong, in fact, that Gov. Matt Mead vetoed the bill. He said while there were problems with the practice, those abuses were not a significant problem in Wyoming.

But the legislature has now passed a bill that met Mead’s muster. Under the law, police would still be able to forfeit property without a criminal conviction, but they must have a judge review the case within 30 days to determine if the officers had probable cause to seize the property. If the judge rules that police did not have probable cause, the property must be returned. The distinction is important because, as it is, judges rarely review seizures.

“If an officer of the law wants to seize some assets, he has to contact the attorney general,” Wyoming State Rep. Kendell Kroeker told TheDCNF. “The attorney general determines if there is probable cause. If the AG determines there is probable cause, the officer may proceed with the seizure (this is the same standard as arresting someone).”

From there, the case must go before a judge within 30 days. Under the bill, people are still not provided an attorney if they can’t afford one, since it is in civil court.

“The judge holds a hearing to review the probable cause standard,” Kroeker told TheDCNF. “If the judge determines there was not probable cause, the assets are returned immediately. If the judge determines there was probable cause, a trial is scheduled. This step is a lot like a grand jury – a grand jury does not determine guilt, rather it determines if there is enough evidence to bring charges and go to trial.”

Under the bill, if the judge rules there was probable cause in seizing the property, then the state must prove in court that there is “clear and convincing” evidence that the property was a part of criminal activity. The burden of proof is now on the state, not the individual.

If the person is innocent, they can sue to recover attorney fees as well as damages. Experts say people will often let their property go because the legal fees are too high. For example, a $4,ooo car might be worth less than the legal fees associated with its recovery from the state, so an innocent victim of civil asset forfeiture might just let police keep the vehicle. For that reason, many forfeitures go unchallenged, especially the smaller sums.

“This is a big incentive for the state to not bring frivolous seizure cases,” Kroeker told TheDCNF. “The bill also protects innocent owners against seizure, that the amount seized must be in proportion to the crime, and requires all seizures to be reported to the judiciary committee.”

A key clause in  the new law requires that the value of assets seized has to be proportional to the seriousness of the crime.

“For example, if someone was coming back from Colorado with a small amount of marijuana, it would not be appropriate to seize his vehicle,” Kroeker told TheDCNF. “There is also innocent owner protection.  This would apply if someone borrowed your car and used it to transport drugs and you had no knowledge of it.  They can’t take your car since you were not involved in the crime.”

From 2008 to 2012, Wyoming authorities seized $2,841,522 and refunded $1,041,577, according to a report from Wyoming Liberty Group using data from the attorney general. That number is a little skewed, though. Of the $1,041,577 returned, a majority was from a single $774,506 seizure that was refunded. Meanwhile, dozens of smaller amounts did not get returned.

Want to know more about how civil asset forfeiture works?

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BREAKING: New Mexico Gov. Signs Bill Abolishing Civil Asset Forfeiture

By Casey Harper

New Mexico Gov. Susana Martinez signed a bill to abolish civil asset forfeiture Friday.

She signed just before the noon deadline that would have pocket vetoed the legislation.

Civil asset forfeiture is a practice where police can seize your property and keep it even if they don’t convict or charge you with a crime. Then, you must go through the difficult, and often unsuccessful process to get your property–whether it’s a vehicle, cash or your home–back from the police.

The new law makes two important changes:

1. Currently, when police seize property they can keep it even if you are innocent. Under the new law, police can still take property from you for a short period, but would need a conviction or a guilty plea in order to keep it.

2. The law changes the incentive structure for police. Under the new law, if police do get a guilty verdict and your property is forfeited, it goes to the state’s general fund rather than the police department’s budget. The difference at least adds a layer of bureaucracy and oversight between police and the funds they seize.

New Mexico’s state legislature passed the bill March 21 just hours before the session closed. If the bill had been vetoed it would likely not gotten attention again for two years because of New Mexico’s short legislative sessions.

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IRS Seizes Nearly $19K From Widow Who Deposited Late Husband’s Savings In Increments

Dubuque, IA- The IRS has seized almost $19,000 from an Iowa woman’s bank account because she was depositing her late husband’s savings in increments under $10,000. Janet Malone, 68, is also facing a criminal misdemeanor charge alleging that she knew the deposits were violating federal law.

The Bank Secrecy Act, passed in 1970 to combat money laundering, requires banks to file reports to the federal government when customers make cash deposits over $10,000. Individuals making cash deposits that are close to meeting the threshold in order to bypass this requirement are considered to be committing a crime called “structuring” whether or not that money was legally or illegally obtained.

Ronald Malone, Janet Malone’s husband, had been visited by IRS agent Jeff McGuire in 2011 to investigate possible structuring. At that time, Ronald Malone was dying of cancer. According to the Associated Press, Mr. Malone acknowledged that the small deposits amounting to $35,500 could be considered structuring and signed a form confirming that he’d been warned about the practice. Janet Malone was at the home for part of that meeting between McGuire and Mr. Malone, but had not signed anything.

Mrs. Malone was reportedly told by her husband shortly before his death in October 2011 about a briefcase containing $180,000 in cash from investment income, gambling winnings and income from his career as an publishing executive. Mrs. Malone then made deposits ranging between $5,800 and $9,000. Prosecutors charged Janet Malone last week with a criminal misdemeanor accusing her of knowingly making small cash deposits from her husband’s savings after he died.

According to an IRS affidavit, Mrs. Malone said that she didn’t remember the details of McGuire’s 2011 visit with her husband because “she was in a state of despair over her husband’s health.”

Last October, the IRS had announced that the agency “will no longer pursue the seizure and forfeiture of funds associated solely with ‘legal source’ structuring cases unless there are exceptional circumstances justifying the seizure and forfeiture and the case has been approved at the director of field operations (D.F.O.) level.”  It is unclear if there are “exceptional circumstances” regarding Mrs. Malone’s deposits. Institute for Justice attorney Larry Salzman said that the government’s case against Mrs. Malone is “shocking because it demonstrates that prosecutors are not taking seriously the IRS’ alleged policy change not to prosecute legal source structuring.”

Restaurant owner Carole Hinders, also from Iowa, had nearly $33,000 seized in 2013 by the IRS for making frequent small cash deposits. Hinders maintained that she had been making small deposits from her cash-only restaurant at the same bank for decades and had never been warned by the bank that “I was making my deposits wrong.” The IRS later returned her money and dropped the case against her, but requested the authority to refile the case. Based on a plea agreement filed Monday, Janet Malone is expected to plead guilty next week and allow the government to keep the seized money. The charge is punishable by up to a year in jail and a $250,000 fine.

According to a review from the Institute for Justice, the IRS seized $242 million in 2,500 cases between 2005 and 2012. A third of those cases were simply cash transactions under $10,000. Nearly half was returned after challenges from owners disputing the seizures.