THE OWNER IS A THIRD PARTY CLAIMANT.
In some cases, the innocence of the owner may not be a defense, although Constitution limitations, such as the Eighth Amendment‘s Excessive Fines Clause, may apply. The owner is effectively put in the position of being a third party claimant. Civil liberties group has filed suit challenging the legality and constitutionality of the New York City program. Citing some of the same constitutional concerns, the House passed a Bill that would drastically curtail the federal operation of the law.
Unless provided in statute (as in 18 U.S.C. § 981(a)(2)), Criminal forfeiture only severs the defendant’s interest, so the property rights of third parties (co-owners, banks, and the like) are theoretically unaffected.
However, third parties may be unaware of the forfeiture and the property’s subsequent disposal. To protect third party interests, the government must provide notice and a hearing to all interested parties. At the hearing, the party must assert and prove their interest by preponderance of the evidence. The same statutes apply–18 U.S.C. § 981 (parallels 18 U.S.C. § 982) and 21 U.S.C. § 881. To complicate matters, these statutes incorporate by reference Customs procedures from 19 U.S.C. § 1602 involving administrative procedure, holding, and disposal.
Due to its civil nature, the roles of the parties change. Instead of prosecutor versus defendant, the hearing concerns a plaintiff, the United States in the case of Federal forfeitures, and a defendant, the property in question. Furthermore, civil hearings involve a more lenient burden of proof than “beyond a reasonable doubt.” Once the government establishes probable cause that the property is subject to forfeiture, the owner must prove by “preponderance of the evidence” that it is not.
innocence of the owner is typically not a defense. Furthermore, courts interpret the statutory defenses stringently. For instance, courts may apply an objective standard to determine if the owner should have had knowledge of the property’s illegal use, rather require proof of actual knowledge. The owner may argue that no crime ever occurred, that the government lacked probable cause, or that the property is not closely enough connected to the crime to be considered an instrumentality or proceeds.
Should any of these defenses succeed, the government need simply return the property to the owner. It is not liable to the owner damages caused by the property’s detention, including damages resulting during the original seizure or a failure to look after the property while in government custody.
What would happen if H.R. 1658 were passed?
The whole character of civil forfeiture under Federal law would be fundamentally altered. Most importantly, the federal government would have to show by a “clear and convincing evidence” standard that the property in question was eligible for forfeiture.
A property owner would be given 30 days to challenge the forfeiture, not 10 days as currently allowed, and would not be required to put up a 10% bond as precondition to the challenge. Judges would have the authority to appoint counsel for indigent plaintiffs, and could release the property to the owner if the owner could show that the loss would be a substantial hardship for him or her. Furthermore, the government would be liable if they negligently lost or damaged the property, and some owners of seized cash could also receive interest if they recover the money.
Definition from Nolo’s Plain-English Law Dictionary
The loss of property or a privilege due to breaking a law.