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Forfeiting Property Rights in the Name of Fighting Crime?

Forfeiting Property Rights in the Name of Fighting Crime?

In the name of fighting crime, both state and local governments seize Americans’ personal cash and private property, even when the citizens are never charged with anything. ...
Jack Kenny

May 22, 2013 started out as a peaceful, quiet day for Carole Hinders, the proprietor for nearly 40 years of Mrs. Lady’s Mexican Food in Spirit Lake, Iowa. She had just finished breakfast with her grandchildren and was about to start a crossword puzzle when there came a knock on the door. She opened it and found two men standing there with some news about her bank account.

“It was two IRS agents who then told me that they had closed my business bank account and had seized all my money which was almost $33,000 dollars,” Hinders said. Hinders does not take credit cards at her restaurant and, unwilling for security reasons to let cash receipts accumulate, she was accustomed to making frequent cash deposits at her bank. That left her vulnerable to a government-created “Catch-22.” Congress in 1970 passed the Bank Secrecy Act, requiring banks to report transactions of $10,000 or more to assist government investigators in the tracking down of foreign or drug-related money-laundering operations.

In the mid-’80s, Congress made it a felony to break down deposits into smaller amounts in order to evade the reporting requirement, a crime called “structuring.” So if you deposit $10,000 or more, you’re a suspect. If you make a series of deposits of less than $10,000, you could be a felon. But in the practice known as civil asset forfeiture, the government may keep your property without charging, much less convicting, you of any crime. Unlike criminal forfeiture, in which the loss of property is contingent on the owner’s conviction of a crime, in civil forfeiture it is the property itself that is “accused” of involvement in criminal activity, and it is up to the owner to prove the taking was wrong. Or in the words of attorney Scott Bullock of the Institute for Justice (IJ), the legal assistance group representing Hinders, “Welcome to the down-is-up and white-is-black world of civil forfeiture.”

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