BILL ANALYSIS Ó
AB 443
Page 1
Date of Hearing: April 28, 2015
Counsel: Gabriel Caswell
ASSEMBLY COMMITTEE ON PUBLIC SAFETY
Bill Quirk, Chair
AB
443 (Alejo) - As Amended April 21, 2015
As Proposed to be Amended in Committee
SUMMARY: Permits prosecutors to seize assets and property of
individuals associated with transnational criminal organizations
up to 60 days prior to the filing of criminal charges pursuant
to criminal profiteering forfeiture proceedings. Specifically,
this bill:
1)Provides that the prosecuting agency may, prior to the
commencement of a criminal proceeding, file a petition of
forfeiture with the superior court of the county in which the
defendant will be charged with a criminal offense, which shall
allege that the defendant has engaged in a pattern of criminal
profiteering activity, including the acts or threats
chargeable as crimes and the property forfeitable, provided
the court determines that:
a) The value of the assets to be seized exceeds $100,000.
b) There is a substantial probability that the prosecuting
agency will file a criminal complaint or seek a grand jury
indictment against the defendant.
c) There is a substantial probability that the prosecuting
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agency will prevail on the issue of forfeiture and that
failure to enter the order will result in the property
being destroyed, removed from the jurisdiction of the
court, or otherwise made unavailable for forfeiture.
d) The need to preserve the availability of the property
through the entry of the requested order outweighs the
hardship on any party against whom the order is to be
entered.
e) There is a substantial probability that the assets
subject to forfeiture represent direct or indirect proceeds
of criminal activity committed for the benefit of, at the
direction of, or in association with, a transnational
criminal organization, as defined.
2)Defines, for purposes of criminal profiteering forfeiture, a
"transnational criminal organization" as "any ongoing
organization, association, or group, having leaders,
associates, operations, or activities in more than one
country, with one of its primary activities being the
commission of one or more specified criminal profiteering
related acts."
3)States that if a forfeiture petition is filed prior to the
filing of the complaint in a criminal action, the motion and
any injunctive order shall be dismissed by operation of law
unless a criminal complaint or grand jury indictment is filed
within 60 days of the grant of the motion. If a forfeiture
petition is dismissed pursuant to this subdivision, the motion
shall not be refiled, except upon the filing of a criminal
complaint.
4)Provides that if a forfeiture petition is filed prior to the
filing of the complaint in a criminal action, a person
claiming an interest in the property or proceeds may move for
the return of the property on the grounds that there is not
probable cause to believe the property is forfeitable and is
not automatically subject to court order of forfeiture or
destruction by another provision of this chapter. The motion
may be made prior to, during, or subsequent to the filing of
criminal charges or a grand jury indictment. If the
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prosecuting agency does not establish a substantial
probability that the property is subject to forfeiture, the
court shall order the seized property released to the person
it determines is entitled thereto.
EXISTING LAW:
1)Establishes the "California Control Profits of Organized Crime
Act." (Pen. Code, § 186.)
2)Declares that the Legislature finds and declares that an
effective means of punishing and deterring criminal activities
of organized crime is through the forfeiture of profits
acquired and accumulated as a result of such criminal
activities. It is the intent of the Legislature that the
"California Control of Profits of Organized Crime Act" be used
by prosecutors to punish and deter only such activities.
(Pen. Code, § 186.1).
3)Defines "criminal profiteering activity" as any act committed
or attempted or any threat made for financial gain or
advantage, which act or threat may be charged as a crime under
any of the following offenses: arson, bribery, child
pornography or exploitation, felonious assault, embezzlement,
extortion, forgery, gambling, kidnapping, mayhem, murder,
pimping and pandering, receiving stolen property, robbery,
solicitation of crimes, grand theft, trafficking in controlled
substances, violation of the laws governing corporate
securities, specified crimes involving obscenity, presentation
of a false or fraudulent claim, false or fraudulent
activities, schemes, or artifices, money laundering, offenses
relating to the counterfeit of a registered mark, offenses
relating to the unauthorized access to computers, computer
systems, and computer data, conspiracy to commit any of the
crimes listed above, offenses committed on behalf of a
criminal street gang, offenses related to fraud or theft
against the state's beverage container recycling program,
human trafficking, any crime in which the perpetrator induces,
encourages, or persuades a person under 18 years of age to
engage in a commercial sex act, any crime in which the
perpetrator, through force, fear, coercion, deceit, violence,
duress, menace, or threat of unlawful injury to the victim or
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to another person, causes a person under 18 years of age to
engage in a commercial sex act, theft of personal identifying
information, offenses involving the theft of a motor vehicle,
abduction or procurement by fraudulent inducement for
prostitution. (Pen. Code, § 186.2(a).)
4)Defines "pattern of criminal profiteering activity" means
engaging in at least two incidents of criminal profiteering,
as defined by this chapter, that meet the following
requirements: (Pen. Code, § 186.2(b)(1).)
a) Have the same or a similar purpose, result, principals,
victims, or methods of commission, or are otherwise
interrelated by distinguishing characteristics;
b) Are not isolated events; and/or
c) Were committed as a criminal activity of organized
crime.
5)Defines "organized crime" as a crime that is of a
conspiratorial nature and that is either of an organized
nature and seeks to supply illegal goods and services such as
narcotics, prostitution, loan-sharking, gambling, and
pornography, or that, through planning and coordination of
individual efforts, seeks to conduct the illegal activities of
arson for profit, hijacking, insurance fraud, smuggling,
operating vehicle theft rings, fraud against the beverage
container recycling program, or systematically encumbering the
assets of a business for the purpose of defrauding creditors.
"Organized crime" also means crime committed by a criminal
street gang, as defined. "Organized crime" also means false
or fraudulent activities, schemes, or artifices, as defined,
and the theft of personal identifying information, as defined.
(Pen. Code, § 186.2(d).)
6)States that the following assets of any person who is
convicted a specified underlying offense and of engaging in a
pattern of criminal profiteering activity are subject to
forfeiture (Pen. Code, § 186.3):
a) Any property interest whether tangible or intangible,
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acquired through a pattern of criminal profiteering
activity; and
b) All proceeds of a pattern of criminal profiteering
activity, which property shall include all things of value
that may have been received in exchange for the proceeds
immediately derived from the pattern of criminal
profiteering activity.
7)States that, notwithstanding that no response or claim has
been filed, in all cases where property is forfeited, as
specified, and, if necessary, sold by the Department of
General Services (DGS) or local governmental entity, the money
forfeited or the proceeds of sale shall be distributed by the
state or local governmental entity as follows (Pen. Code, §
186.8):
a) To the bona fide or innocent purchaser, conditional
sales vendor, or holder of a valid lien, mortgage, or
security interest, if any, up to the amount of his or her
interest in the property or proceeds, when the court
declaring the forfeiture orders a distribution to that
person. The court shall endeavor to discover all those
lien holders and protect their interests and may, at its
discretion, order the proceeds placed in escrow for up to
an additional 60 days to ensure that all valid claims are
received and processed;
b) To DGS or local governmental entity for all expenditures
made or incurred by it in connection with the sale of the
property, including expenditures for any necessary repairs,
storage, or transportation of any property seized, as
specified; and
c) To the State's General Fund or local governmental
entity, whichever prosecutes.
FISCAL EFFECT: Unknown
COMMENTS:
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1)Author's Statement: According to the author, "AB 443 seeks to
empower a prosecuting agency's ability to effectively
dismantle criminal organizations by targeting the proceeds of
criminal activity while respecting the due process rights of
suspects, arrestees, and criminal defendants.
"Specifically, AB 443 provides a prosecuting agency with the
ability to freeze criminal assets before the commencement of a
criminal proceeding. Waiting until the filing of a criminal
proceeding to bring a petition for asset forfeiture brings the
risk of providing an early notification to the criminal
organization under investigation. Criminal organizations
benefit from the early warning system by transferring or
removing their assets from the jurisdiction of the court.
While the criminal proceeding may affect an individual in the
criminal organization, the criminal operations of these gangs
can proceed as their funds remain available.
"Although this tool allows for a forfeiture petition to be
filed before the filing of a criminal complaint, the bill
includes several safeguards to protect the due process rights
of criminal suspects, arrestees, and defendants. The bill
strikes an appropriate line between these constitutional
rights and the need for protecting the public from organized
crime. Many of these organizations are operating in cities
throughout the state.
"In addition, AB 443 aims to punish and deter the trafficking
in firearms and endangered species by adding these crimes to
the definition of "criminal profiteering activity," making the
profits of these crimes subject to forfeiture."
2)The Proposed Amendments: This bill includes a number of
amendments that were negotiated between the author, the bill
sponsor, and committee staff, in consultation with some of
the opposition to the bill. The arguments in support and in
opposition were submitted prior to the proposed amendments.
The amendments do not remove opposition, but they were made in
an attempt to address some of their concerns and limit the
applicability of the proposed legislation. The amendments
fall into the following categories:
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a) Transnational Criminal Organizations: The original bill
applied the seize and freeze provisions to all criminal
profiteering forfeiture proceedings. However, the
background provided by the sponsor indicated that the
purpose of the bill was to seize the assets of
transnational gangs. The bill, as introduced did not limit
the applicability of the seizure provisions to
transnational gangs.
The bill as proposed to be amended today defines transnational
criminal organizations for purposes of criminal forfeiture as:
"any ongoing organization, association, or group, having
leaders, associates, operations, or activities in more than one
country, with one of its primary activities being the commission
of one or more specified criminal profiteering related acts."
The proposed amendments additionally add an additional element
to the proposed seizure language that require prosecutors show
"a substantial probability that the assets subject to forfeiture
represent direct or indirect proceeds of criminal activity
committed for the benefit of, at the direction of, or in
association with, a transnational criminal organization." The
bill, as proposed to be amended, therefore limits the
applicability of the seizure to transnational criminal
organizations, as defined.
b) Threshold Amount: The threshold amount triggering the
seize and freeze provisions is $100,000. Forfeiture covers
anything from liquid (or cash) assets, to vehicles, to real
estate. The author's office originally set a minimum of
$10,000 and the amendments have raised the minimum to
$100,000.
c) Motion for Return of Seized Property: As discussed in
the "Due Process" section below, there are a number of
constitutional concerns when the government seeks to
deprive a person of their property. Namely, people have a
right to be heard. A more thorough analysis of this
concept is included in the following section. However, the
amendments seek to improve upon these concerns. As
introduced, the bill did not provide for an opportunity for
a person with an interest in the property to be heard on
the issue of whether the property should or should not be
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seized until the civil forfeiture proceeding ran its
course. This would be after the conclusion of the criminal
case.
The bill, as amended, provides an opportunity for an interest
holder to make a motion to the court for return of their
property and argue that the prosecution has failed to meet the
requirements set forth in the seizure provisions.
3)Due Process: Seize and Freeze: This bill seeks to add a
provision to the criminal profiteering section which will
allow prosecutors to seize assets up to 60 days prior to
filing a criminal action if the following criteria are shown
to a judge by a prosecutor:
a) The value of the assets to be seized exceeds $100,000.
b) There is a substantial probability that the prosecuting
agency will file a criminal complaint or seek a grand jury
indictment against the defendant.
c) There is a substantial probability that the prosecuting
agency will prevail on the issue of forfeiture and that
failure to enter the order will result in the property
being destroyed, removed from the jurisdiction of the
court, or otherwise made unavailable for forfeiture.
d) The need to preserve the availability of the property
through the entry of the requested order outweighs the
hardship on any party against whom the order is to be
entered.
e) There is a substantial probability that the assets
subject to forfeiture represent direct or indirect proceeds
of criminal activity committed for the benefit of, at the
direction of, or in association with, a transnational
criminal organization, as defined.
The showing is made by a prosecutor in an ex parte proceeding.
Thus the person whose property is being seized is not present
at the proceeding and is not able to refute any allegations
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made by the prosecution prior to the seizing of the assets.
The bill, as drafted and as proposed to be amended, does not
provide a person with an opportunity to be heard prior to the
seizure of their property. A person's property may not be
confiscated by the state without "some kind of notice and
opportunity to be heard." Fuentes v. Shevin (1972) 407 U.S.
67, 79-80. "We start with the basic proposition that in every
case involving a deprivation of property within the purview of
the due process clause, the Constitution requires some form of
notice and a hearing." Beaudreau v. Superior Court (1975) 14
Cal.3d. 448, 458). The bill's sponsor argues that the ex
parte nature of the proceeding is necessary to prevent the
property owner from hiding or moving assets. Opponents argue
that prosecutors can first seize the property without
sufficient evidence to bring criminal charges against a
prospective defendant and will allow for seizure of an
innocent owner's property without due process.
The proposed amendments to the bill do provide for an
opportunity for a person claiming interest in the property to
make a motion for return of the property during the 60 day
period prior to the filing of criminal charges. While this
does not provide for a hearing prior to the seizure of the
property, it does provide a remedy that was not present in the
original bill which allows an interest holder in the seized
property to move for return of the property on the basis of
the prosecution not meeting their burden in the ex parte
proceeding.
4)Substantial Probability: The bill does provide that the
prosecution must allege to a magistrate that there is a
"substantial probability" that the agency will file a criminal
complaint or seek a criminal grand jury indictment.
Additionally, the prosecutor must allege that there is a
"substantial probability" that the prosecuting agency will
prevail on the issue of forfeiture.
According to the sponsor, the standard of substantial
probability is intended to be at least as demanding as
probable cause. California courts have found the term to be
synonymous with "strong probability" or "strong likelihood."
(Walbrook Ins. Co. v. Liberty Mut. Ins. Co. (1992) 5
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Cal.App.4th 1445, 1460-1461.) In the search warrant context,
the term is also synonymous with "probable cause." (See
Fenwick & W. v. Superior Court (1996) 43 Cal.App.4th 1272,
1278-1279 ["Probable cause must attach to each place to be
searched. Thus, an affidavit for a search warrant must contain
facts demonstrating a substantial probability that evidence of
a crime will be located in a particular place."]; People v.
Garcia (2003) 111 Cal.App.4th 715, 721 [same].) "Substantial
probability" also appears several times in the U.S. Code,
including in the asset forfeiture context (21 U.S.C. §
853(e)(1)(B)(i)). Courts addressing the use of the term in
federal statutes have uniformly held that substantial
probability actually affords defendants greater protection
than the probable cause standard. (See United States v. Gotti
(2d Cir. 1986) 794 F.2d 773, 777 ["Congress was aware that the
'probable cause' standard is less demanding than a requirement
of 'substantial probability"]; United States v. Wong (D. Haw.
2012) 2012 WL 5464178, at *3 [same].)
5)Interim Property Value: The bill would allow for seizure of
property for up to 60 days prior to the filing of criminal
proceedings against the property owner or asset holder. The
bill does provide however that the property may not be
forfeited if the agency fails to file criminal charges within
the prescribed 60-day window allotted. However, the bill does
not address compensation to the property owner for the interim
value of the property. For instance, if a business owner must
shut down his or her business, there is no provision for that
owner to receive remuneration for their economic losses during
that period. In fact, such a seizure could result in the loss
of a business completely.
6)Criminal Profiteering Asset Forfeiture Generally: Criminal
profiteering asset forfeiture is a criminal proceeding held in
conjunction with the trial of the underlying criminal offense.
Often, the same jury who heard the criminal charges also
determines whether the defendant's assets were the ill-gotten
gains of criminal profiteering. As a practical matter, the
prosecution must assemble its evidence for the forfeiture
matter simultaneously with the evidence of the crime.
Under Penal Code Section 186.2, asset forfeiture for is allowed
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upon conviction of more than thirty crimes under specified
circumstances.
"Criminal profiteering activity means any act committed or
attempted or any threat made for financial gain or advantage,
which act or threat may be charged as a crime [under various
criminal statutes]. Those crimes include: arson; bribery,
child pornography or exploitation, which may be prosecuted as
a felony; felonious assault, embezzlement; extortion, forgery,
gambling, kidnapping, mayhem, murder, pimping and pandering,
receiving stolen property, robbery, solicitation of crimes,
grand theft, trafficking in controlled substances, violation
of the laws governing corporate securities, crimes related to
possession and distribution of obscene or harmful matter,
presentation of a false or fraudulent claim, false or
fraudulent activities, schemes, or artifices, money
laundering, offenses relating to the counterfeit of a
registered mark, offenses relating to the unauthorized access
to computers, computer systems, and computer data, conspiracy
to commit any of the crimes listed above, felony gang
activity, as specified, any offenses related to fraud or theft
against the state's beverage container recycling program,
including, but not limited to, those offenses specified in
this subdivision and those criminal offenses specified in the
California Beverage Container Recycling and Litter Reduction
Act, human trafficking, any crime in which the perpetrator
induces, encourages or persuades a person under 18 years of
age to engage in a commercial sex act, any crime in which the
perpetrator, through force, fear, or coercion, deceit
violence, duress, menace, or threat of unlawful injury to the
victim or to another person, causes a person under 18 years of
age to engage in a commercial sex act, theft of personal
identifying information, motor vehicle theft, and abduction or
procurement by fraudulent inducement for prostitution". (Pen.
Code, § 186.2(a)(1) to (33).)
7)Criminal Profiteering Proceeds: Under existing law, forfeited
assets are distributed as follows:
a) To the bona fide or innocent purchaser, conditional
sales vendor, or holder of a valid lien, mortgage, or
security interest, if any, up to the amount of his or her
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interest in the property or proceeds, when the court
declaring the forfeiture orders a distribution to that
person. The court shall endeavor to discover all those
lien holders and protect their interests and may, at its
discretion, order the proceeds placed in escrow for up to
an additional 60 days to ensure that all valid claims are
received and processed.
b) To the Department of General Services or local
governmental entity for all expenditures made or incurred
by it in connection with the sale of the property,
including expenditures for any necessary repairs, storage,
or transportation of any property seized, as specified.
c) To the State's General Fund or local governmental
entity, whichever prosecutes.
Under existing law, the forfeited proceeds of criminal
profiteering are placed in the county general fund with no
directions for use. There is an exception for forfeiture
in child pornography cases. In such cases, the money is
deposited in the county or State Children's Trust Fund for
child abuse and neglect prevention and intervention. (Pen.
Code, § 186.8 and Welf. and Inst. Code, § 18966 and 18969.)
In California drug asset forfeiture, law enforcement
receives 65% of forfeiture proceeds. (Health and Safety
Code Sections 11469 et seq.) Of this amount, 15% must be
placed in a special county or city fund used "to combat
drug abuse and divert gang activity." Under federal
forfeiture law allowing "adoption" of state seizures of
drug proceeds, the agency seizing that property may receive
as much as 80% of these proceeds. This money must be used
according to guidelines set by the United States Department
of Justice and require that the money be used largely for
law enforcement.
8)Elements of the Offense: Proceeds can be forfeited if the
proceeds were gained through a pattern of criminal activity
and were gained through involvement in organized crime.
a) Pattern of Criminal Activity: "Pattern of criminal
profiteering activity" means engaging in at least two
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incidents of criminal profiteering (listed above), that
meet the following requirements
i) Have the same or a similar purpose, result,
principals, victims, or methods of commission, or are
otherwise interrelated by distinguishing characteristics;
ii) Are not isolated events; and/or
iii) Were committed as a criminal activity of organized
crime.
b) Organized Crime: "Organized crime" means crime that is
of a conspiratorial nature and that is either of an
organized nature and seeks to supply illegal goods and
services such as narcotics, prostitution, loan-sharking,
gambling, and pornography, or that, through planning and
coordination of individual efforts, seeks to conduct the
illegal activities of arson for profit, hijacking,
insurance fraud, smuggling, operating vehicle theft rings,
fraud against the beverage container recycling program, or
systematically encumbering the assets of a business for the
purpose of defrauding creditors. "Organized crime" also
means crime committed by a criminal street gang.
"Organized crime" also means false or fraudulent
activities, schemes, or artifices, and the theft of
personal identifying information.
9)Argument in Support: According to the The Attorney General,
"AB 443 has been carefully crafted to preserve due process
rights. Moreover, existing law has protections that would
apply to any changes made by AB 443. These include:
the burden to prove that the assets are subject to
forfeiture and tied to criminal activity lies on the state
the state must prove their tie by the legal standard
"beyond a reasonable doubt"
any proceeds from the forfeiture of assets or monies
does not go back to the seizing entity.
"The first two provisions ensure one of the cornerstones of
our legal system: innocent until proven guilty. Laws that
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permit the seizure of assets prior to a conviction receive
criticism by placing the burden of proof on the defendant.
States that place the burden of proof on the owner create a
barrier to due process and force innocent owners to navigate
the legal system. California law protects innocent owners by
placing the burden on the government entity. Moreover, the
standard of proof required increases the burden. As reported
by the Institute for Justice, 'beyond a reasonable doubt' is
the hardest standard under which it is hardest to forfeit
assets. Not only does the government have the responsibility
to prove the assets are subject to forfeiture but it must also
do so by meeting the highest standards of a courtroom.
"Finally, California law does not create an incentive for law
enforcement to seize assets. . Currently, California's order
of distribution statute mandates any money forfeited or
proceeds from a sale to be distributed accordingly:
1. To any innocent purchasers, conditional sales vendor, or
holder of a valid lien, mortgage, or security interest
2. To the Department of General Services or local governmental
entity for all expenses related to the sales
3. To the General Fund of the State or the general fund of a
local governmental entity
"There are also provisions that allow for the funds to go into
a County's Children's Trust Fund, the California Beverage
Container Recycling Fund, and to the Victim-Witness Assistance
Fund for certain crimes for which the assets were forfeited.
State and local law enforcement are not on the order of
distribution. They do not receive any budget increases as a
result of any proceeds from seized assets.
"In California, the intent of asset forfeiture is not to fund
local enforcement agencies. In California, assets are seized
to reduce the profitability of criminal enterprises, remove
the assets required to fund these criminal activities, and
protect public safety throughout the state.
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"While California law currently ensures these protections, AB
443 also implements further provisions to safeguard due
process. Foremost, the bill merely establishes a process by
which a prosecuting agency can petition to freeze assets for
an individual suspected of engaging in a pattern of criminal
profiteering activity. The power to approve a petition for
the preservation of assets will remain with the courts. Given
this provision, no law enforcement or prosecuting agency will
have the ability to freeze or seize assets without the
approval of the petition. This will protect many assets from
seizure. For example, an individual pulled over for a traffic
stop, found in the possession of a large sum of money, may not
have his or her assets frozen. The law enforcement officer
will not have the approval of a court as no petition was
sought beforehand nor does a traffic stop count as 'engaged in
a pattern of criminal profiteering'.
"In deciding whether or not to approve a petition to freeze
assets, the court cannot grant approval unless certain
conditions are met. As mentioned earlier, the court must find
that the value of the assets to be seized exceeds $10,000. In
a review of the recently terminated Federal Equitable Sharing
Program, which was a means for states to seize assets without
charges or a conviction, the Washington Post found that half
of the seizures were below $8,800. AB 443 casts a much
narrower net by setting the floor at $10,000. This provision
ensures that law enforcement agencies target larger
operations.
"Second, the court must find a substantial probability that
the prosecuting agency will file a criminal complaint and that
there is a substantial probability that the prosecuting agency
will prevail on the issue of forfeiture. When a prosecuting
agency petitions the court for asset preservation before
filing for a criminal proceeding, they will still need to
convince the courts that the assets are tied to criminal
activity. Without securing substantial probability on these
two fronts, the courts may deny the petition. Finally, in the
case where a prosecuting agency may be granted permission but
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does not file for a criminal proceeding, the order to freeze
the assets will be dismissed within 60 days from when it was
granted. Nor could a prosecuting agency return to the court
and petition to freeze the same assets unless accompanied by a
new criminal complaint.
"With these protections, the people of California can feel
confident that their rights are protected. As the chief law
enforcement officer in the state, the Attorney General is
deeply committed to protecting the rights of Californians. AB
443 protects and ensures due process while also enabling law
enforcement agencies to dismantle transnational organizations.
These criminal organizations threaten the safety of our
neighborhoods and place Californians in danger. We are proud
to sponsor AB 443 as part of the efforts to rid these
international criminal organizations from California's
streets."
1)Argument in Opposition: According to California Attorneys for
Criminal Justice, "This bill allows a prosecuting agency to
file a petition of forfeiture prior to the commencement of the
underlying criminal proceeding if there is a 'substantial
probability' that the prosecuting agency will file a criminal
complaint and there is a 'substantial probability' the
prosecuting agency will prevail on the issue of forfeiture.
"As written, the agency anticipating the commencement of
criminal proceedings can seize first without sufficient
evidence to bring charges. This will cause the forfeiture of
an innocent owner's valuable property without provision of any
concomitant avenue of Due Process. The implied hearing rights
suggested in context of pre-complaint seizure would be a
plenary action in the superior court. In other words, an
action that the aggrieved property owner would have to both
initiate and pay for, or suffer forfeiture. The provision in
AB 443 dismissing the motion by 'operation of law' does
absolutely nothing to restore the interim value of property
that has been seized. The interim harm could be significant to
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someone who is not charged with a crime, especially if all his
or her assets are seized for the two-month period.
"The statutory provision for pre-charging /post-seizure
hearing inherent in AB 443 fails to meet constitutional
requirements. A person's property may not be confiscated by
the state without 'some kind of notice and opportunity to be
heard.' Fuentes v. Shevin (1972) 407 U.S. 67, 79-80. . "We
start with the basic proposition that in every case involving
a deprivation of property within the purview of the due
process clause, the Constitution requires some form of notice
and a hearing.'Beaudreau v. Superior Court (1975) 14 Cal.3d
448, 458. Many controversies have raged about the cryptic and
abstract words of the Due Process Clause but there can be no
doubt that at a minimum they require that deprivation of life,
liberty or property . . . be preceded by notice and
opportunity for hearing appropriate to the nature of the
case.' Mullane v. Central Hanover Tr. Co. (1950) 339 U.S. 306,
313. CACJ believes that the proposed governmental 'need' for
private property in AB 443 can never outweigh the need of the
true owner not to be deprived of property without due process
of law.
"Such hearings are virtually always required before the
taking. Kash Enterprises, Inc. v. City of Los Angeles (1977)
19 Cal.3d 294, 308. Postponement of notice and provision of a
due process hearing until after the initial taking has
occurred is generally disfavored. Id. Even if criminal charges
are ultimately filed, due to the time sensitive value of
various instruments and property, the delays inherent in AB
443 would probably cause many seizing agencies to become
belatedly liable to the person whose property was seized. Hunt
v. United States Dep't of Justice (5th Cir. Tex. 1993) 2 F.3d
96.
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"AB 443 contains a self-executing clause which vests
inappropriate authority in the hands of prosecutors. This bill
requires showing that it is 'substantially probable' that
charges will be filed since this pre-hearing is attended only
by the prosecutor, the prosecutor would simply be able to make
an assertion and that assertion is to be taken as fact. The
defense is not present to cross-examine the prosecutor to
assure the veracity of the statement. The burden is met simply
because the prosecutor says so.
"Affected property owners would be caught in an inevitable and
unconstitutional 'Catch-22'. On the one hand between seeking
immediate redress, or, requiring the Court to delay discovery
(which, due to the civil nature of a pre-complaint seizure,
the seizing agency would then have an obligation to provide)
until disposition of the criminal matter. Pacers, Inc. v.
Superior Court (1984) 162 Cal. App. 3d 686, 690. Given the
ever increasing statutes of criminal limitations in this
state, such cases could take decades to resolve. Viewed in
this context, the mischief of a pre-complaint 'criminal'
seizure statute becomes plainly apparent not only in the cost
to individuals, but to the already heavily burdened superior
courts of this state.
"The state can have no legitimate interest in the seizure of
the property of others, until such time as there occurs a
nexus and sufficient evidence to support the filing of a
criminal charge against the owner that will then allow the
accused person to litigate the matter in a single action, thus
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saving scarce judicial resources and preserving the accused's
established rights to due process of law."
2)Related Legislation:
a) AB 160 (Dababneh), adds piracy, insurance fraud, and tax
fraud to the list of crimes for which a prosecutor can seek
criminal profiteering forfeiture. Additionally, amends the
organized crime element of criminal profiteering to provide
additional examples of matter which constitute criminal
profiteering. AB 160 is awaiting a hearing in the Assembly
Appropriations Committee.
b) SB 298 (Block), adds money laundering for criminal
profiteering to the crimes for which a wiretap may be
sought. SB 298 is awaiting a hearing in the Senate
Appropriations Committee.
3)Prior Legislation:
a) AB 1791 (Galgiani), of the 2011-2012 Legislative
Session, would have included within the definition of
"criminal profiteering activity" the sale of tangible
personal property or other secondhand goods, including, but
not limited to, gold and other precious metals, excluding
"coin dealers" as defined, without a license. AB 1791
failed passage in the Assembly Public Safety Committee.
b) AB 17 (Swanson), Chapter 211, Statutes of 2009, included
abduction or procurement by fraudulent inducement for
prostitution within the definition of criminal profiteering
activity.
c) AB 924 (Emerson), Chapter 111, Statutes of 2007,
included vehicle theft within the definition of criminal
profiteering activity.
d) AB 988 (Bogh), Chapter 53, Statutes of 2005, included
identity theft within the definition of criminal
profiteering activity.
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e) AB 22 (Lieber), Chapter 240, Statutes of 2005, included
human trafficking within the definition of criminal
profiteering activity.
f) SB 968 (Bowen), Chapter 125, Statutes of 2003, included
Beverage Act fraud within the definition of criminal
profiteering activity.
g) SB 1520 (Schiff), Chapter 994, Statutes of 2000,
requires that secondhand dealers make reports
electronically to local law enforcement, of pawned
property, and requires DOJ, in consultation with law
enforcement agencies, to develop clear descriptive
categories of personal property that a secondhand dealer
must report to local law enforcement agencies.
REGISTERED SUPPORT / OPPOSITION:
Support
California Attorney General's Office (sponsor)
Alameda County District Attorney's Office
California Police Chiefs Association
California Statewide Law Enforcement Association
Gonzalez Police Department
Law Center to Prevent Gun Violence
Monterey County District Attorney's Office
Peace Officers Research Association of California
Santa Clara District Attorney's Office
Soledad Police Department
Opposition
American Civil Liberties Union
California Attorneys for Criminal Justice
California Public Defenders Association
Gun Owners of California
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Analysis Prepared
by: Gabriel Caswell / PUB. S. / (916) 319-3744