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U.S. Justice Department Recovers a Total of $1.1 Billion in Largest Ever Civil Asset Forfeiture Claim

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sebastian-pichler-bAQH53VquTc-unsplash-300x200The Department of Justice (DOJ) has reached a settlement of its civil forfeiture case against Khadem al-Qubaisi, an Emirati businessman who allegedly misappropriated billions from a Malaysian investment development fund and laundered the money in the U.S. by buying high-end properties.

1Malaysia Development Berhad (1MDB) is an investment development fund created by the Malaysian government to promote economic development in Malaysia through direct foreign investments and international partnerships. Its funds were intended to be used for improving the lives of the Malaysian people.

According to the Justice Department’s complaint, from 2009 through 2015, more than $4.5 billion from 1MDB was allegedly misappropriated by high-level officials in charge of the fund, including al-Qubaisi, through a criminal conspiracy involving international money laundering and bribery.

Al-Qubaisi is accused of embezzling and laundering monies from the development fund through financial institutions in several jurisdictions, including the U.S., Luxembourg, Singapore, and Switzerland.

The assets subject to the DOJ’s settlement agreement include the sale proceeds of luxury properties acquired in Beverly Hills and New York City worth more than $49 million. With the conclusion of this settlement, together with prior disposition of other forfeiture cases, the DOJ will have recovered nearly $1.1 billion in assets associated with the 1MDB money laundering and bribery scheme. This represents the largest civil forfeiture case ever concluded by the DOJ.

“This settlement is another milestone in the asset forfeiture cases related to the 1MDB money laundering scheme—cases that have already led to the recovery of well over $1 billion,” U.S. Attorney Nick Hanna said in a press release. “Funds stolen from the people of Malaysia were used to acquire high-end properties, including residences each worth tens of millions of dollars. The cases resolved today continue to demonstrate our commitment to protecting the integrity of American financial institutions and ensuring that corrupt players cannot use our nation to conceal stolen riches.”

Under the terms of the DOJ’s settlement, the Atlantic Property Trust, which oversees the assets being seized, agreed to forfeit all assets subject to pending forfeiture complaints in which they have a potential interest. The trustee, who is the wife of al-Qubaisi, is also required to cooperate with the DOJ in the transfer, management, and disposition of the relevant assets.

The DOJ noted that several related asset forfeiture complaints remain pending against assets associated with other alleged co-conspirators.

Civil asset forfeiture is a legal process that allows authorities to seize property—cars, real estate, cash, etc.—that is suspected of being connected to a crime without necessarily charging the property owner of any wrongdoing. To get back the seized property, the owner must prove in court that it wasn’t involved in any criminal activity.

Proponents of the system see it as a powerful tool to thwart criminal organizations involved in the illegal drug trade, since it allows law enforcement to seize cash and other assets belonging to suspected drug traffickers. However, critics argue that innocent property owners often become embroiled in the process to the extent that their 4th and 5th Amendment rights are violated.

South Florida Civil Asset Forfeiture Attorney

Has your lawful property been seized using asset forfeiture? Contact Brian Silber, P.A. to set up a free initial consultation and work with one of South Florida’s most experienced civil asset forfeiture attorneys.

Source: 5.6.20 US reaches settlement to recover $49 involving Malaysian sovereign wealth fund.pdf

Michigan County Prosecutor Eric Smith Charged for Embezzling Asset Forfeiture Funds

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alabama-1611179_1920-300x287The Michigan Attorney General’s Office announced charges last week against Macomb County Prosecutor Eric Smith and three other county officials accused of felony crimes that include misconduct in office, embezzlement, and misusing funds obtained through civil asset forfeiture.

Smith is charged with embezzlement by a public official, tampering with evidence in a civil proceeding, official misconduct in office, accessory after the fact to embezzlement by a public official, conspiracy to commit forgery, and conducting a criminal enterprise. Attorney information wasn’t available.

According to the attorney general’s office, the charges against Smith are the result of a year-long public integrity investigation that began after a public records lawsuit revealed over $100,000 from Macomb County’s civil asset forfeiture fund was used for questionable expenditures. The investigation revealed that Smith and three other officials embezzled almost $600,000 since 2012.

The attorney general’s office claims the investigation “found that Smith and other defendants used the money to buy flowers and make-up for select secretaries, a security system for Smith’s residence, garden benches for staffers’ homes, country club catering for parties, campaign expenditures and more.”

The other defendants named in this case are:

  • Benjamin Liston, retired Macomb County assistant prosecutor and former chief of operations. He is charged with official misconduct in office, conducting a criminal enterprise, and embezzlement by a public official.
  • Derek Miller, Macomb County’s current assistant prosecutor and chief of operations. Miller faces charges of official misconduct in office and conspiracy to commit a legal act in an illegal manner.
  • William Weber, owner of Weber Security Group. He faces charges of forgery and larceny by conversion, aiding and abetting embezzlement by a public official, and receiving and concealing stolen property.

“In order for citizens to maintain trust in the institutions of government, public officials must, at all times, conduct themselves in accordance with the laws of our state,” Michigan Attorney General Dana Nessel said. “When public officials fail to do so, the people must have confidence that they will be held to account, fairly, and without any special treatment based upon their status as a public official. The Department of Attorney General, will continue to work to protect this fundamental principle, that no one is above the law.”

Civil asset forfeiture is a legal process that allows law enforcement to seize property—cash, vehicles, and even houses—suspected of being connected to criminal activity such as drug trafficking. Law enforcement agencies use the seized proceeds to further battle illegal activity.

Civil forfeiture is a powerful tool that enables law enforcement to disrupt organized crime, but civil liberty groups say there aren’t enough procedural protections for innocent owners who have their property seized and must prove in court that it wasn’t involved in any criminal activity. The proceeds agencies gain from asset forfeiture also incentivizes corruption and misbehavior.

Anyone who has had their private property seized through asset forfeiture should immediately consult an attorney who can investigate your case and quickly build a winning defense.

South Florida Civil Asset Forfeiture Attorney

Has your property been seized using asset forfeiture? Contact Brian Silber, P.A. to set up a free initial consultation and work with one of South Florida’s most experienced civil asset forfeiture attorneys.

Source: 3.25.20 Michigan County prosecutor charged with embezzling asset forfeiture funds.pdf

Supreme Court Ruling May Impact Civil Asset Forfeiture Policies of Florida Police Departments

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justice-2060093_1920-300x200A U.S. Supreme Court ruling announced on February 19 has law enforcement agencies in Florida questioning whether they need to change how they seize people’s cash, cars, and homes using a practice known as civil asset forfeiture.

Civil asset forfeiture is a nationwide practice that allows authorities to seize property—vehicles, cash, houses, electronics, and the like—that are suspected of being connected to a crime. The Supreme Court’s ruling struck at the heart of the practice, which is derisively known as “policing for profit,” because police often use it to seize assets even if the owner isn’t charged with a crime.

The decision centered on the 2013 case of Tyson Timbs of Indiana, whose $42,000 Land Rover was seized by police after he was caught dealing a small amount of heroin. The vehicle was legally purchased with money he received from a life insurance policy after his father’s death.

Timbs sued the police to get the vehicle back, but the Indiana Supreme Court upheld the decision, arguing that the Eighth Amendment’s clause on “excessive fines” doesn’t apply to state actions. Timbs took the case to the U.S. Supreme Court, which ruled the “excessive fines” clause applies to state governments through the Fourteenth Amendment.

The Supreme Court’s ruling has left the attorneys of police departments across Florida evaluating their asset forfeiture policies, which often end up benefiting the state’s most powerful elected officials. Gov. Ron DeSantis, for example, has reportedly flown around the state on a plane police seized from a drug dealer. Tampa Mayor Bob Buckhorn has used a vehicle seized from a convicted criminal as his official city transportation.

Several police departments told the press that they were already abiding by the Supreme Court’s decision. Miami-Dade Police Director Juan Perez said existing laws are already restrictive and his agency doesn’t make much from auctioning off seized assets.

“It will have little impact if any. We were in consideration of the Eighth Amendment,” Perez told the Miami Herald. “Our policies were in line with what the court went by already. So we don’t expect any changes.”

Perez’s statement doesn’t seem to apply to the police departments of other cities in South Florida. A 2014 investigative report by the Sun Sentinel found that the Broward County city of Sunrise (population: 90,000) seized more than $2 million in cash in 2012, which is more than three times what was seized by other cities in Broward and Palm Beach counties. Much of this money was reportedly used as overtime pay for officers working the sting operations that led to the seizures.

Last week’s ruling unfortunately didn’t provide exact calculations for determining what constitutes a fair fine or seizure, but it may help to reform how Florida’s police departments currently handle seizures.

South Florida Civil Asset Forfeiture Attorney

Has your property been seized using asset forfeiture? Contact Brian Silber, P.A. to set up a free initial consultation and work with one of South Florida’s most experienced civil asset forfeiture attorneys.

Source: 2.21.20 Supreme Court decision may choke cash flow for some florida police departments.pdf

Class-Action Lawsuit Challenges Detroit’s Civil Asset Forfeiture Racket

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pexels-photo-534204-300x167The Institute of Justice has filed a federal class-action lawsuit against Wayne County, Michigan, alleging that county police seize vehicles from residents in Detroit simply because they have driven in or out of high-crime areas.

The lead plaintiff in the case is Melisa Ingram of Detroit. Police seized her vehicle twice after accusing her of committing crimes without ever formally charging her. Ingram had to pay thousands of dollars to get her vehicle back, or the county prosecutor would have kept it under civil asset forfeiture laws.

Civil asset forfeiture is a nationwide system that allows authorities to seize property—cash, vehicles, electronics, houses, etc.—that are supposedly connected to a crime. Proponents of asset forfeiture laws say it is a necessary tool to disrupt criminal activity by targeting illicit proceeds, but civil liberty groups like the Institute of Justice argue that there too many incentives for police to abuse it and not enough protections for innocent citizens.

According to the lawsuit filed on February 5, Ingram’s 2017 Ford Fusion was first seized in late 2018 after she loaned it to a former boyfriend. Her ex-boyfriend was detained by county deputies for allegedly soliciting a prostitute, but he wasn’t charged with any crime. That didn’t stop country deputies from seizing the vehicle and issuing a notice to Ingram that the county intended to keep it using asset forfeiture. Ingram had to make a settlement payment to get her car back.

The vehicle was seized a second time in the summer of 2019. Ingram once again loaned it to her boyfriend so he could drive to a friend’s house. The boyfriend was pulled over after he purportedly left a house police allege was connected to criminal activity. Again, no one was charged, but the prosecutor’s office seized the vehicle and demanded another settlement payment from Ingram.

Police in Wayne County are running an aggressive forfeiture operation as part of a campaign targeting criminals involved with drugs and prostitution in high-crime areas. According to public records, the county has seized more than 2,600 cars over the past two years, raking in more than $1.2 million in asset forfeiture revenues.

No was charged with a crime in 438 of those cases. In almost a dozen cases, the vehicles were seized under suspicion of a drug violation, even though records show police didn’t find any drugs. Wayne County prosecutors usually offer to settle such cases and return the owner’s vehicle for a $900, plus storage and towing fees.

“Civil forfeiture is one of the greatest threats to property rights in the nation today,” said Institute of Justice attorney Wesley Hottot. “It allows police and prosecutors to seize and then permanently take people’s property without even charging them with a crime. You don’t have the kind of protections that you would have in a normal criminal proceeding.”

In its lawsuit, the Institute of Justice claims these settlement offers, plus the costly and lengthy process of challenging a seizure, amount to a shakedown and violate the 4th, 8th, and 14th Amendment.

South Florida Civil Asset Forfeiture Attorney

Has your property been seized using asset forfeiture? Contact Brian Silber, P.A. to set up a free initial consultation and work with one of South Florida’s most experienced civil asset forfeiture attorneys.

Source: 2.6.2020 class-action lawsuit challenges Detroit’s asset forfeiture racket.pdf

New Jersey to Track Money and Property Seized Under Civil Asset Forfeiture: A Further Examination

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person-holding-fountain-pen-753695-288x300The Fourth Amendment to the US Constitution guards American citizens against illegal search and seizure of property. But when a law enforcement official does initially have reasonable cause, what happens to the property (including cash) after it is determined no crime was committed after all?

 

This is at the heart of the issue with civil asset forfeiture. And it is being addressed in many states, including New Jersey. As this blog recently covered, in January 2020, Governor Phil Murphy signed legislation (S1963) requiring disclosure and transparency requirements for civil asset forfeiture. New Jersey joins a number of states that have moved in this direction at the request of several citizens’ watchdog groups, including the ACLU-NJ and Americans for Prosperity and the AFP Foundation.

Brought to the NJ legislature by Assemblywoman Angela McKnight, the bill was supported by Assemblymen Jay Webber and Erik Peterson.

 

“It’s un-American to take people’s property under the premise that it was gained through criminal activity when a person has not been convicted of a crime,” said Assemblyman Peterson. 

 

S1963 would require county prosecutors to submit quarterly reports to the Attorney General. These reports would outline in detail all the seizure and forfeiture activities within their specific county. This reporting would also have to give a confiscation date, which law enforcement agency was involved, a description of the property or a total of the cash taken, the alleged criminal activity associated with the seizure, and whether the defendant was charged with a crime and how that case ended. If an agency did not report, they would be required to return seized property or proceeds resulting from forfeited property, no matter the circumstances.

 

The stakes for law enforcement agencies are high. A great deal of money that now funds community programs as well as equipment for their own agencies is taken in through civil asset forfeiture. The property is auctioned off and added to the cash taken, and this money is used to fund the programs and equipment. In itself, no one questions the worth of these programs. What is in question is a lack of transparency and accountability on the part of law enforcement officials.

 

Assemblywoman McKnight said, “With this law the people of New Jersey and our state officials will finally have access to much-needed data concerning which agencies are profiting from property seizures, what is being taken, and how the proceeds are being used.”

 

Assemblyman Peterson agreed. “When homes, cars, money, and other property worth millions of dollars are seized every year, there must be adequate controls in place to prevent abuses. There’s no uniform seizure policy across the state making the reporting in this bill necessary. It shines a light on who is taking assets and ensures the money is used to benefit taxpayers.”

 

Another issue with the current situation in New Jersey is that the highest rate of forfeiture comes from some of the economically poorest counties in the state. Many citizens don’t have the resources to fight to get their cash and property back. This concerns ACLU-NJ Policy Director Sarah Fajardo.

 

“This law moves our state closer to curtailing and ultimately ending the use of civil forfeiture and the racially disparate over-policing it encourages, disproportionately occurring in communities that are already some of New Jersey’s most vulnerable. We applaud Gov. Murphy for signing this law, and we commend the Legislature for passing it,” said Fajardo.

 

If your property is wrongfully taken through civil asset forfeiture, you deserve legal representation to help you reclaim what is yours. Contact Brian Silber, a successful civil asset forfeiture attorney, today for a free consultation.

Sources: 1.2020 NJ CAF laws, 1.13.19 NJ CAF law signed