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Judicial Watch • Tom Fitton Civil Forfeiture NY Testimony

Tom Fitton Civil Forfeiture NY Testimony

Tom Fitton Civil Forfeiture NY Testimony

Page 1: Tom Fitton Civil Forfeiture NY Testimony


Number of Pages:4

Date Created:December 15, 2014

Date Uploaded to the Library:December 15, 2014

Tags:Civil Forfeiture, testimony, State Department, Supreme Court

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Tom Fitton 
President, Judicial Watch 
The Committee Codes and the Committee Judiciary 
New York State Assembly 
New York, 
December 2014 
Good morning, Im Tom Fitton, President Judicial Watch.  Judicial Watch conservative, non-partisan educational foundation dedicated promoting transparency, accountability and integrity government, politics and the law.  Through its educational endeavors, Judicial Watch advocates high standards ethics and morality our nations public life and seeks ensure that political and judicial officials obey the law and not abuse the powers entrusted them the American people. 
Thank you Chairman Lentol and Chairman Weinstein for inviting testify this important rule law issue.  
Since passing the Racketeer Influenced and Corrupt Organizations (RICO) Act 1970, civil asset forfeiture has been important federal law enforcement tool. The 1978 expansion the RICO Act include drug-related offenses and the Comprehensive Crime Control Act 1984 greatly expanded this authority. Most significantly, the CCCA incentivized the participation state and local law enforcement agencies civil forfeiture actions allowing the sharing seized assets between those agencies and their Federal partners. The law also lowered the government's burden proof for justifying civil seizures. Predictably, these legislative changes led sudden and dramatic increase forfeitures. The Department Justice's forfeiture fund increased from $27 million 1985 more than billion 1996. Despite the modest restraints put the program the 2000 Civil Asset Forfeiture Reform Act, revenue has continued trend upward. 2012, the Asset Forfeiture Fund's revenue was more than billion. 
 While civil forfeiture has been efficient and effective means depriving criminal enterprises illegally-obtained revenue, the practice inherently problematic. Individuals and businesses whose assets are seized are granted limited legal recourse challenge those seizures. Because the majority forfeitures result from rem actions (taken against the property 
itself, rather than against the owner), the ability mount effective defense severely diminished. This creates condition which the government favored and the defendant (that is, the owner the defendant property disadvantaged). Approximately percent federal civil asset forfeiture actions are challenged court.  But those challenged since 2001, high percentage (41%) succeeds, according the data uncovered the Washington Post.  
While most such actions the government are likely justified, the very legal structure civil forfeiture invites abuse. This exacerbated the sheer number predicate offenses that can trigger the seizure assets. the federal level, there are over 200 such offenses. Often, citizens with criminal intent have had their assets seized overzealous investigators and prosecutors. One such case involves Long Island-based Bi-County Distributors, Inc., and its owners, the Hirsch brothers. The company, which distributes candy and other goods local convenience stores, often paid cash for its deliveries. the past, banks have closed Bi-County's deposit accounts due the brothers making deposits over $10,000 (the federal reporting threshold for currency transactions). avoid this inconvenience, the Hirsch's broke their deposits into amounts less than $10,000. The I.R.S. interpreted this activity violation federal banking laws (which prohibit intentionally "structuring" payments avoid reporting requirements without legitimate business reason for doing so). Although there has been accusation that the proceeds the brothers deposited resulted from criminal activity, the federal government seized more than $446,000 from the business 2012. Over two years later, they have had opportunity challenge the seizure court.  The Hirsch brothers are now represented the Institute for Justice, non-profit law firm.  Obviously, most property owners facing redress court over seized property dont have the benefit public interest law groups providing charitable legal services. New York City, many apparent civil forfeiture abuses result not from federal law, but from dated provision the city's administrative code that grants the New York Police Department broad authority seize currency and property whenever arrest made. Because seized assets are used fund the NYPD's pension fund and for other law enforcement purposes, the system creates perverse incentive. According recent analysis, percent NYPD forfeiture cases, the owner the seized property never charged with crime. This year, the city projected seize $5.3 million assets via civil forfeiture. 
 The prosecutorial practice incorporating deferred prosecution agreements (DPAs) part civil asset forfeiture action raises additional set troubling concerns. Under these arrangements, defendants consent seizure and civil penalties exchange for avoiding prosecution. Most often, the defendants are corporations. The arrangements can beneficial for both the government and the defendants, they avoid the necessity lengthy, complex, and expensive trials. Prosecutors can secure victory, while defendants, definition, avoid criminal sanctions.  For corporation, especially one publicly traded, even criminal indictment can cause financial collapse.  The government sensitive this and hesitant destroy jobs and company with criminal proceedings.  The numbers corporate DPA agreements have increased significantly recent years. Between 2000 and 2004, there were fewer than such agreements each year. This rose 2012. the 273 DPAs between 2000 and 2013, 252 were executed after January 2005. The year 2005 when the U.S. Supreme Court threw out the criminal conviction Arthur Andersen, the soon-to-be defunct firm that once employed 28,000 individuals here the U.S.     
 While the pairing DPAs with financial sanctions can mutually beneficial for the parties involved  and for the public large  these agreements can undermine the publics confidence the fair administration justice. Defendants whose actions appear criminal seem able escape prosecution because they have the financial means enter into multi-million dollar settlement. one recent case, the Manhattan District Attorney's Office and the New York State Department Financial Services resolved its investigation Met Life's unlicensed business activities via DPA that included $10 million forfeiture. 2012, that office's joint investigation (with the U.S. Department Justice) HSBC's sanctions violations resulted DPA coupled with $375 million settlement. According the New York County District Attorney's Office, has secured more than $2.4 billion similar bank settlements since 2009.  
While the logistical advantages resolving these investigations via DPA agreements are clear, the net effect, for some critics, allow those who violate the law pay their way out jail. Or, from the point view others, businesses face the equivalent judge, jury, and executioner when faced with potential criminal indictment and have choice, even 
innocent, but pay enormous fines save their companies.  These agreements are extraordinarily lucrative for the government. 2013, penalties and forfeitures from them totaled nearly $2.9 billion.   
 Though the benefit the public coffers from civil forfeitures and DPAs can significant, their overuse can undermine the due process rights American citizens.  The appearance that government can fund its operations seizing property without much concern about court oversight something think Americans would want avoid.  Congress and the media are pushing reform these areas and your respective committees are right consider these issues that are increasing public concern. 
 Thank you.