What is Asset Forfeiture?
Asset forfeiture is a powerful tool used by law enforcement agencies, including the FBI, against criminals and criminal organizations to deprive them of their ill-gotten gains through seizure of these assets.
History of Asset Forfeiture
Asset forfeiture has its roots in the ancient practice by governments to defend against piracy through the seizure of vessels and contraband.
Today it is used to disrupt, dismantle, and deter those who prey on the vulnerable for financial gain, including criminal organizations, drug dealers, terrorists, and white-collar criminals.
Why does the FBI Use Asset Forfeiture?
- To punish criminals
- To deter illegal activity
- To disrupt criminal organizations
- To remove the tools of the trade from criminals
- To return assets to victims
- To protect communities
Types of Forfeiture
There are three types of forfeiture under federal law: criminal forfeiture, civil judicial forfeiture, and administrative forfeiture.
- Criminal Forfeiture: Criminal forfeiture is brought as part of a criminal prosecution of a defendant. It is an in personam (against the person) action and requires that the government indict the property used or derived from the crime along with the defendant. In criminal forfeiture, an individual has the right to contest the seizure through trial proceedings.
- Civil Judicial Forfeiture: Civil judicial forfeiture is a judicial process that does not require a criminal conviction and is a legal tool that allows law enforcement to seize property that is involved in a crime. Referred to as an in rem (against the property) action, it is an action filed against the property itself, rather than a person. In civil judicial forfeiture, an individual has the right to contest the seizure through trial proceedings. The government then must prove that the property facilitated criminal activity or represents criminal proceeds.
Administrative Forfeiture: Most federal forfeiture cases are uncontested even if there is a related criminal case. Administrative forfeiture occurs when property that facilitated criminal activity or represents criminal proceeds is seized but no one files a claim to contest the seizure. Property that can be administratively forfeited includes merchandise prohibited from importation; a conveyance used to import, transport, or store a controlled substance; a monetary instrument; or other property that does not exceed $500,000 in value. Houses and other real property may not be forfeited administratively. Federal law imposes strict deadlines and notification requirements in the administrative forfeiture process. If the seizure is contested, then the U.S. government is required to use either criminal or civil judicial forfeiture proceedings to gain title to the property.
Returning assets to victims of crime is a top priority of the Department of Justice Asset Forfeiture Program. Since 2000, the victim compensation program has returned more than $9 billion in civilly and criminally forfeited assets to victims through the granting of petitions for remission or by transferring forfeited funds to courts for payment of restitution through the restoration process.
Use of Forfeited Funds
All across the country, forfeited funds and property are being used to help protect and serve our communities and support law enforcement. For example, in Kentucky, forfeited funds were used to refurbish a facility to shelter child abuse victims in the state. And in New York City, forfeited funds are being used to advance community-based policing to better serve neighborhoods. These funds have financed an array of additional services and equipment, including:
- A drug and alcohol treatment facility
- Transportation to drug treatment services
- Naloxone rescue kits for opioid overdose victims
- A job skills program
- A youth program aimed at drug and crime prevention
- Afterschool programming
- A plaque for a law enforcement officer killed in the line of duty
- School resource officer salaries
- Bomb-sniffing canines
- Bulletproof vests and body cameras for law enforcement
- 911 call center equipment
- Care for abused and rescued animals seized for forfeiture
- Gun buy-back programs
- Personal protective equipment for first responders
Forfeited funds also are being used to train law enforcement to ensure strict compliance with the Fourth Amendment, Due Process and Excessive Fines Clause of the U.S. Constitution when seizing and forfeiting property.
Examples of Forfeiture in Action
- In May 2020, the Department of Justice reached a civil forfeiture settlement to return nearly $50 million in stolen funds to the people of Malaysia. Together with prior distributions from related cases, the United States recovered or assisted in the recovery of nearly $1.1 billion in assets associated with the 1Malaysia Development Berhad international money laundering and bribery scheme. Press release
- In May 2020, the Department of Justice returned more than $311 million, secured through civil forfeiture, to the government of the Federal Republic of Nigeria. The funds were returned through a trilateral agreement among the governments of the United States, Nigeria, and the Bailiwick of Jersey to repatriate assets that were traceable to the kleptocracy of former Nigerian dictator Sani Abacha. Press release
- In November 2018, a district judge in New York entered an order forfeiting more than $143 million in assets—including account funds, foreign currency, luxury cars, jewelry, and art—seized from David H. Brooks, the founder and former CEO of body armor manufacturer DHB Industries, Inc. Brooks died in prison while appealing his mail, wire, and securities fraud convictions and sentence, which were vacated—and the corresponding restitution order abated—as a result of his death. Because a civil forfeiture action had been filed separately, the government was able to successfully prosecute it against the seized assets. This civil forfeiture order will allow the government to compensate thousands of victim investors for most of their losses. Press release
- In July 2015, Dr. Farid Fata—a Detroit-area hematologist and oncologist—was sentenced to 45 years in prison for his role in an extensive health care fraud scheme. The case resulted in more than $40 million in seizures of real property, a vehicle, bank accounts, and business entities, as well as a money judgment of $17.6 million. Investigators seized approximately $13 million and established a team of specialists to assist victims and their family members in submitting claims for restitution. Press release
- Department of Justice Asset Forfeiture Program
- The Attorney General's Guidelines on the Asset Forfeiture Program
- Attorney General Issues Policy and Guidelines on Federal Adoptions of Assets Seized by State or Local Law Enforcements
- Department of Justice Journal of Federal Law and Practice: Asset Forfeiture and Money Laundering