Testimony as prepared for delivery
Chairman [Peter] Roskam, Vice-Chairman [Pat] Meehan, Ranking Member [John] Lewis and members of the subcommittee: thank you for the opportunity to appear today to discuss the important topic of civil asset forfeiture and structuring.
As a 27-year prosecutor and the Deputy Assistant Attorney General overseeing a variety of areas including the Asset Forfeiture and Money Laundering Section, I am honored to represent the Department of Justice today and to address the department’s commitment to ensuring that federal asset forfeiture laws are appropriately and effectively used, consistent with civil liberties and the rule of law.
Asset forfeiture and the structuring laws are critical legal tools that serve a number of compelling law enforcement purposes, including detecting and deterring other illegal activity. The Bank Secrecy Act assists law enforcement in the detection of criminal conduct by requiring financial institutions to file reports concerning financial transactions in excess of $10,000. The criminal structuring laws enacted by Congress are intended to prevent individuals from evading these important reporting requirements.
The government is required to prove three elements for a structuring charge, namely that the defendant:
1. structured his transactions,
2. knew of the reporting requirements and
3. intended to evade the reporting requirements.
It is important to note that structuring is not a strict liability crime. An individual who inadvertently divides up his deposits or withdrawals cannot be liable for structuring because he lacks the intent to evade the reporting requirements.
Congress has authorized a variety of sanctions, both civil and criminal, for structuring violations, including forfeiture of the structured funds. In a civil action to forfeit property linked to crime, including a structuring violation, the government has the burden of proving by a preponderance of the evidence that a crime occurred and that the seized property was connected to that crime. Even after the government has proven its case, the law entitles any individuals with standing to assert a claim that they are innocent owners of the property at issue and defeat the government’s claim. After a forfeiture is complete, a petitioner can seek the return of property by filing a petition for remission or mitigation.
Remission and mitigation do not contest the forfeiture. Rather, in effect, those petitions are tools to request a pardon for the forfeited property. The department has procedures in place for considering and fairly resolving such petitions. Those who committed structuring violations do not qualify for remission because they are not “innocent owners” under the terms of the law. Such petitioners might, however, qualify for mitigation, which is a decision to pardon some portion of the forfeited property based upon a holistic review of the case.
The factors the department considers when evaluating mitigation include:
1. the existence of a prior record or evidence of similar criminal conduct;
2. whether the violation includes a drug crime;
3. the violator’s cooperation with law enforcement on the related matter;
4. was the violation isolated and not part of a larger scheme; and
5. the necessity of the forfeiture to achieving a legitimate forfeiture purpose.
In order to protect and maintain the integrity of the work of our career prosecutors and agents, I cannot comment on any pending litigation or specific cases, but I can tell you that the department continues to thoroughly review and appropriately rule on any current and newly filed petitions for remission or mitigation, including those involving structuring violations.
I would also like to highlight the department’s ongoing comprehensive review of forfeiture practices and policies over the past 18 months. As part of that review, on March 31, 2015, the department issued a policy limiting the use of asset forfeiture authorities in connection with structuring offenses in most cases to instances where a defendant has been criminally charged or there is evidence of additional criminal activity beyond the crime of structuring. The new policy also imposes important protections after a seizure has taken place, including a directive to return the funds if the prosecutor at any time determines there is insufficient evidence to prevail at trial, and imposing a deadline for filing a criminal indictment or civil complaint against the funds seized. This policy is a significant change that exceeds the requirements of the law, and it underscores the Department of Justice’s commitment to fighting crime and returning money to victims while protecting civil liberties and ensuring due process.
I thank the subcommittee for its interest in these issues, and am happy to answer any questions you may have.