BILL ANALYSIS Ó
SENATE COMMITTEE ON PUBLIC SAFETY
Senator Loni Hancock, Chair
2015 - 2016 Regular
Bill No: AB 443 Hearing Date: July 14, 2015
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|Author: |Alejo |
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|Version: |May 4, 2015 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|JM |
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Subject: Forfeiture
HISTORY
Source: Attorney General of California
Prior Legislation: AB 2466
(Blumenfield) - Ch. 512, Stats. 2012
AB 364 (Bonilla) - Ch. 182, Stats. 2011
AB 1293 (Blumenfield) - Ch. 371 Stats. 2011
AB 17 (Swanson) - Ch. 211, Stats. 2010
AB 1199 (Richardson) - Ch. 408, Stats. 2007
SB 968 (Bowen) - Ch. 125, Stats. 2003
AB 215 (Leslie) - 2003; failed passage in
Assembly Public Safety
AB 1990 (Liu) - Ch. 991, Stats. 2002
AB 662 (Wesson) - 1999 Legislative Session;
vetoed
Support: Alameda County District Attorney; California District
Attorneys Association; California Police Chiefs
Association; California Statewide Law Enforcement
Association; Gonzalez Police Department; Law Center to
Prevent Gun Violence; Monterey County District
Attorney; Peace Officers Research Association of
California; Santa Clara County District Attorney;
Soledad Police Department
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Opposition:American Civil Liberties Union; California Attorneys
for Criminal Justice; California Public Defenders Association;
Gun Owners of California
Assembly Floor Vote: 71 - 5
PURPOSE
The purpose of this bill is to: 1) authorize a prosecutor in a
criminal profiteering (organized crime) matter to file a
petition for forfeiture of illicitly derived assets and profits
from persons associated with transnational criminal
organizations up to 60 days prior to the filing of criminal
charges; 2) require the prosecutor to provide notice to any
party that may have an interest in property subject to
forfeiture; 3) authorize a person claiming an interest in seized
property to move the court "for return" of the property on the
grounds that there is no probable cause that the property is
forfeitable; and 4) provide that the court may issue the order
if it finds the following: there is a substantial probability
that criminal charges will be filed or a grand jury indictment
sought, 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 court's jurisdiction, or otherwise kept from
forfeiture.
Existing law:
1) Defines "criminal profiteering activity" as any act made
for financial gain or advantage if the act may be charged
as one of the following crimes: arson, bribery, child
pornography, assault, embezzlement, extortion, forgery,
gambling, kidnapping, mayhem, murder, pimping and
pandering, receiving stolen property, robbery, criminal
solicitation, grand theft, drug trafficking, making a
fraudulent claim, money laundering, conspiracy, active
participation in a criminal street gang, any felony
committed for the benefit of a gang, beverage recycling
fraud, human trafficking, causing a minor through force,
coercion or deceit to engage in commercial sexual conduct,
abduction or procurement by fraud for prostitution, auto
theft, or identity theft(Pen. Code § 186.2, subd. (a).)
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2) Defines "pattern of criminal profiteering activity" as
engaging in at least two incidents of criminal profiteering
that meet the following requirements:
Have the same or a similar purpose, result,
principals, victims, or methods of commission, or are
otherwise interrelated by distinguishing
characteristics;
Are not isolated events; and
Were committed as a criminal activity of
organized crime. (Pen. Code § 186.2, subd. (b).)
3) Provides that after conviction of the qualifying
offense, a person may be subject to asset forfeiture if the
prior act occurred within 10 years, excluding any period of
imprisonment, of the commission of the underlying offense.
(Pen. Code § 186.2, subd. (b).)
4) Provides that upon proof of specified provisions, the
following assets shall be subject to forfeiture:
A property interest acquired through a pattern
of criminal profiteering activity; and
All proceeds of a pattern of criminal
profiteering activity, including all things of value .
. . received in exchange for the proceeds . . .
derived from the pattern of criminal profiteering
activity. (Pen. Code § 186.3.)
5) Provides that the prosecutor shall file the forfeiture
petition in conjunction with the criminal proceeding and
provide notice to persons who may have an interest in the
property that is alleged to be subject to forfeiture.
(Pen. Code § 186.4.)
6) Provides that when or after charges and a forfeiture
petition are filed in a criminal profiteering forfeiture
case, the prosecutor may move the court for orders
preserving the defendant's assets that may be subject to
forfeiture, as follows:
An injunction to restrain all interested parties from
transferring, encumbering or
otherwise disposing of property subject to forfeiture.
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Appoint a receiver to manage the property.
Require a surety bond if necessary to
preserved the interests of interested parties. (Pen.
Code § 186.6.)
7) Provides that where the prosecutor seeks an order
preserving property for purposes of forfeiture, notice must
be given to interested parties and a hearing held to
determine that an order is necessary to preserve the
property pending disposition of the criminal case, there is
probable cause that the property is truly subject to
forfeiture. Neither an injunction may be granted nor a
receiver appointed without a hearing. The court may issue
a temporary restraining order pending a hearing. (Pen.
Code § 186.6.)
8) Provides that the forfeiture proceedings shall be set
for hearing in the superior court in which the underlying
criminal offense will be tried. If the defendant is found
guilty of the underlying offense, the issue of forfeiture
shall be promptly tried, before the same jury or a new jury
in the discretion of the court, unless waived by all
parties. (Pen. Code § 186, subds. (c)-(d) .)
9) Requires that before assets are forfeited, the
prosecuting agency shall have the burden of establishing
beyond a reasonable doubt that the defendant was engaged in
a pattern of criminal profiteering activity. (Pen. Code §
186.5.)
10) Provides that where a defendant is convicted of two or
more related felonies involving fraud or embezzlement, and
the pattern of conduct involves the taking or loss of more
than $100,000, the defendant shall be punished by an
"aggravated white collar crime [prison term] enhancement."
(Pen. Code § 186.11.)
11) Provides, with respect to white collar enhancement and
large-scale fraud cases, that to "prevent dissipation or
secreting of assets or property, the [prosecutor] may, at
the same time as or subsequent to the filing of [the
applicable charges] seek a temporary restraining order ? or
any other protective relief necessary to preserve the
property or assets." (Pen. Code §§ 186.11, subd. (e).)
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12) Authorizes the court to place a white collar crime
defendant on probation for up to 10 years to ensure payment
of restitution. The provisions for protection of assets
seized from defendants shall remain in effect through
sentencing in order to satisfy fines and restitution
orders. (Pen. Code § 186.11, subds. (d).)
13) Sets out detailed procedures that apply to a petition
for preserving property in a white collar crime cases.
These include, but are not limited to, the following:
The orders (preliminary injunction and temporary
restraining order) must be
issued solely to preserve property so that restitution
and fines will be paid;
The prosecutor shall file a lis pendens (notice of a
lawsuit affecting real property)
as to all real property subject to the orders;
The prosecutor may obtain an order that any
financial institution to disclose specified
information about relevant accounts;
The court may issue a temporary restraining
order (TRO) supported by an affidavit by a peace
officer with personal knowledge about the case. The
TRO may be issued without notice to the defendant upon
a showing of good cause;
A person who claims an interest in the
protected property may file a claim concerning his or
her interest in seized property, as specified;
The defendant or a person who has filed a
verified property claim may seek modification of any
orders, including relief from a lis pendens;
The court may appoint a receiver to manage
property. The defendant may be ordered to post a
bond;
The court may order sale of a property that is
liable to perish or substantially drop in value; and
The court shall weigh the relative certainty
of the outcome of the prosecution and the consequences
to interested parties if property preservation orders
are issued.
The court shall give significant weight to the following
factors:
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The public interest in preserving the property;
The difficult of preserving the assets;
The purpose for the preservation orders;
The likelihood that the charged crime caused substantial
public harm;
The court shall seek to protect the interests
of innocent parties, including an innocent spouse;
The court may consider a defendant's request
to release property to pay bail, legal fees, and
living expenses, but must consider the public
interest, the nature of the crime and the purpose for
the preservation orders; and
The court may issue orders to preserve the
continuing viability of any lawful business. (Pen.
Code §§ 186.11, subds. (d)-(f).)
14) Provides that where the jury finds the defendant not
guilty of the underlying fraud crime, or it finds the
white-collar enhancement allegation untrue, any preliminary
injunction or TRO shall be dissolved. (Pen. Code §
186.11.)
1) Authorizes prosecuting agencies, at the same time as the
filing of a complaint or indictment charging human
trafficking, to file a petition for protective relief
necessary to preserve property or assets that could be used
to pay for remedies relating to human trafficking,
including, but not limited to, restitution and fines.
(Pen. Code § 236.6, subd. (a).)
2) Specifies the process by which a preliminary injunction,
temporary restraining order, or sale of property or assets
may be ordered. The process is essentially the same as the
process set out in Penal Code Section 186.11 - preservation
of assets in white collar crime cases, and 186.12 -
preservation of assets in large-scale elder and dependent
abuse financial cases. (Pen. Code § 236.6, subds.
(b)-(j).)
This bill:
1) Provides that to prevent dissipation or secreting of
assets or property in criminal asset forfeiture matter
involving a transnational criminal organization, as
defined, the prosecuting agency may file a petition for
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forfeiture prior to commencement of criminal proceedings
upon the following showing:
The value of the assets to be seized exceeds $100,000.
There is a substantial probability that the
prosecuting agency will file a criminal complaint or
seek a grand jury indictment against the defendant.
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.
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.
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.
1) 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.
2) States that if a forfeiture petition is filed prior to
the filing of the complaint in a criminal action, the
petition 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.
3) Provides that if a forfeiture petition is dismissed
because criminal charges were not filed within 60 days, 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
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the filing of criminal charges, a person claiming an
interest in the property 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 otherwise
subject to court order of forfeiture or destruction by
another specified statute.
5) Provides that a motion for return of property may be
made prior to, during, or subsequent to the filing of
criminal charges or a grand jury indictment. If the
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 to the property.
RECEIVERSHIP/OVERCROWDING CRISIS AGGRAVATION
For the past eight years, this Committee has scrutinized
legislation referred to its jurisdiction for any potential
impact on prison overcrowding. Mindful of the United States
Supreme Court ruling and federal court orders relating to the
state's ability to provide a constitutional level of health care
to its inmate population and the related issue of prison
overcrowding, this Committee has applied its "ROCA" policy as a
content-neutral, provisional measure necessary to ensure that
the Legislature does not erode progress in reducing prison
overcrowding.
On February 10, 2014, the federal court ordered California to
reduce its in-state adult institution population to 137.5% of
design capacity by February 28, 2016, as follows:
143% of design bed capacity by June 30, 2014;
141.5% of design bed capacity by February 28, 2015; and,
137.5% of design bed capacity by February 28, 2016.
In February of this year the administration reported that as "of
February 11, 2015, 112,993 inmates were housed in the State's 34
adult institutions, which amounts to 136.6% of design bed
capacity, and 8,828 inmates were housed in out-of-state
facilities. This current population is now below the
court-ordered reduction to 137.5% of design bed capacity."(
Defendants' February 2015 Status Report In Response To February
10, 2014 Order, 2:90-cv-00520 KJM DAD PC, 3-Judge Court, Coleman
v. Brown, Plata v. Brown (fn. omitted).
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While significant gains have been made in reducing the prison
population, the state now must stabilize these advances and
demonstrate to the federal court that California has in place
the "durable solution" to prison overcrowding "consistently
demanded" by the court. (Opinion Re: Order Granting in Part and
Denying in Part Defendants' Request For Extension of December
31, 2013 Deadline, NO. 2:90-cv-0520 LKK DAD (PC), 3-Judge Court,
Coleman v. Brown, Plata v. Brown (2-10-14). The Committee's
consideration of bills that may impact the prison population
therefore will be informed by the following questions:
Whether a proposal erodes a measure which has contributed
to reducing the prison population;
Whether a proposal addresses a major area of public safety
or criminal activity for which there is no other
reasonable, appropriate remedy;
Whether a proposal addresses a crime which is directly
dangerous to the physical safety of others for which there
is no other reasonably appropriate sanction;
Whether a proposal corrects a constitutional problem or
legislative drafting error; and
Whether a proposal proposes penalties which are
proportionate, and cannot be achieved through any other
reasonably appropriate remedy.
COMMENTS
1.Need for This Bill
According to the author:
AB 443 - sponsored by Attorney General Kamala Harris -
will allow a prosecuting agency to file a petition of
forfeiture for good cause prior to the commencement of
a criminal proceeding in cases of criminal
profiteering. The bill is focused at freezing and
preserving the assets of transnational criminal
organizations. Gang violence and crime continue to be
serious problems across the state, and we must take
steps to diminish the grip they have on many of our
most disadvantaged communities. By freezing the
assets of criminal organizations, we hit them where it
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hurts most, and we can put a halt to their operations.
According to a report released by Attorney General
Harris - "Gangs Beyond Boarders: California and the
Fight Against Transnational Organized Crime,"
"[t]ransnational Criminal Organizations are
self-perpetuating associations operating across
national borders that use violence, corruption, and
fraud to protect and disguise their illicit, and
profit-driven activities."
This bill comes directly from a recommendation in the
stating "[t]he Legislature should amend California law
to enable prosecutors to temporarily freeze the assets
of transnational criminal organizations and their gang
associates before the filing of an indictment." A
void in current law essentially gives transnational
criminal organizations notice prior to the freezing of
assets, allowing the organization to move funds beyond
the prosecutor's reach. This perpetuating system that
gives criminals a leg up over law enforcement must
end. AB 443 shifts the advantage and allows law
enforcement to effectively address transnational crime
in our state.
2.Background on Criminal Asset Forfeiture
In 1982, the California Legislature passed the California
Control of Profits of Organized Crime Act. The express purpose
of the Act was to punish the activities of organized crime
through the forfeiture of profits acquired and accumulated as a
result of engaging in a pattern of criminal profiteering
activity. All property gained through that activity is subject
to forfeiture. (Penal Code §§ 186 and 186.1.)
Criminal profiteering asset forfeiture is a criminal proceeding
held in conjunction with the trial of the underlying criminal
offense. Often, the same jury that heard the criminal charges
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 existing law the forfeited proceeds of criminal
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profiteering are placed in the county general fund with no
directions for use. There are limited exceptions. For example,
forfeiture in child pornography cases is deposited in the county
or State Children's Trust Fund for child abuse and neglect
prevention and intervention. (Pen. Code § 186.8; Welf. Inst.
Code §§ 18966 and 18969.)
In contrast to criminal asset forfeiture, drug asset forfeiture
is a separate civil action. With limited exceptions, a
conviction for an underlying drug offense is required. However,
the prosecution in drug asset forfeiture can conduct substantial
civil discovery to find the defendant's assets. Law enforcement
receives 65% of drug forfeiture proceeds. Federal forfeiture
law authorizes a federal agency to "adopt" a state seizure and
return as much as 80% of the proceeds to the state or local
agency. The United States Attorney General has recently limited
adoption of state forfeitures.<1>
3.History of Seize and Freeze Statutes; This Bill
In 1995, SB 950 (Killea) created a special sentencing scheme for
defendants convicted of relatively egregious forms of white
collar crime. The law provided for sentence enhancements and
high fines. The law included a procedure for the preservation
of the assets of persons alleged to be subject to this
punishment enhancement. The law authorized the court to levy
upon the assets upon the defendant's conviction, in order to pay
restitution and fines.
In 2011, the white collar crime asset preservation law was
extended to any case involving white collar financial fraud over
$100,000. (AB 364 (Bonilla) Ch. 182, Stats. 2011.) Also in
2011, the asset preservation provisions were adapted to cases of
large-scale elder and dependent abuse. (AB 1293 (Blumenfield)
Ch. 371 Stats. 2011.) The process in each kind of case is
essentially the same.
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<1> SB 443 (Mitchell), which passed this Committee (5-2) and is
scheduled to be heard on July 14, 2015 in the Assembly Public
Safety Committee, would prohibit state or local law enforcement
agencies from transferring seized property to a federal agency
for adoption, require that property seized pursuant to federal
law be distributed to state and local law enforcement agencies
according to state law formulas, and that convictions be
obtained before the agencies could share in federal forfeiture
proceeds.
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Human trafficking laws include a seize and freeze asset
preservation process. The process is largely equivalent to the
white collar crime and elder abuse asset preservation statutes.
This bill would allow prosecutors to seize assets up to 60 days
prior to filing a criminal action in an organized crime -
criminal profiteering matter. To obtain the order, the
prosecutor must show the following:
The value of the assets to be seized exceeds $100,000.
There is a substantial probability that the prosecuting
agency will file a criminal complaint or seek a grand jury
indictment against the defendant.
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.
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.
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.
4.Constitutional Issues
Constitutional due process generally requires that 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; See
also, Horn v. County Of Ventura (1979) 24 Cal. 3d 605; 612.)
This bill does not expressly state that the initial hearing on a
petition for forfeiture is an ex parte hearing - a hearing where
only one party addresses the court, and would not eliminate the
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requirement in existing law that the prosecutor provide notice
to persons or entities affected by the seizure. However, it is
not entirely clear when the notice must be given. Under the
bill, a person whose property has been seized would appear to be
limited to disputing the prosecutor's factual allegations and
legal argument through a motion for return of property after it
has been seized.
The United States Supreme Court has explained the very limited
exceptions to the requirement of notice and the opportunity to
be heard before a person is deprived of property:
We tolerate some exceptions to the general rule
requiring pre-deprivation notice and hearing, but only
in extraordinary situations where some valid
governmental interest is at stake that justifies
postponing the hearing until after the event. ?The
three-part inquiry set forth in Mathews v. Eldridge
(1976) 424 U.S. 319, provides guidance in this regard.
The Mathews analysis requires us to consider the
private interest affected by the official action; the
risk of an erroneous deprivation of that interest
through the procedures used, as well as the probable
value of additional safeguards; and the Government's
interest, including the administrative burden that
additional procedural requirements would impose. (Id.,
at 335.)
?[In] Calero-Toledo ? the Government's interest in
immediate seizure of a yacht subject to civil
forfeiture justified dispensing with the usual
requirement of prior notice and hearing. Two
essential considerations informed our ruling in that
case: First, immediate seizure was necessary to
establish the court's jurisdiction over the property,
416 U.S. at 679, and second, the yacht might have
disappeared had the Government given advance warning
of the forfeiture action, ibid. See also United
States v. Von Neumann, 474 U.S. 242, 251, 88 L. Ed. 2d
587, 106 S. Ct. 610 (1986) (no pre-seizure hearing is
required when customs officials seize an automobile at
the border). Neither of these factors is present when
the target of forfeiture is real property. Because
real property cannot abscond, the court's jurisdiction
can be preserved without prior seizure. United States
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v. Good (1993) 510 U.S. 43, 53, 57, italics added.)
The sponsor - the Attorney General - argues that an ex parte
proceeding is necessary to prevent the property owner from
hiding or moving assets. Members may wish to consider whether a
specific determination, based on the facts of each case, would
be necessary to conclude that an ex-parte proceeding is
justified, and whether United States Supreme Court decisions
require the court hearing the ex-parte seizure motion to use the
balancing test in Matthews v. Eldridge noted above.
The ACLU, which opposes this bill, argues that this bill
"permits the government to seize property without sufficient
evidence to bring charges. It also appears to permit the
government to seize property without an adequate opportunity to
be heard. Both issues raise significant Due Process concerns."
The bill does 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
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.
WOULD THE BLANKET EX PARTE PROCEEDING PROPOSED BY THIS BILL
SATISFY CONSTITUTIONAL DUE PROCESS REQUIREMENTS?
The bill also provides 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 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. "Substantial
probability" also appears several times in the U.S. Code,
including in the asset forfeiture context (21 U.S.C. §
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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.)
5. Potential Loss of Value if Property is Returned to the Owner
The bill would allow for seizing 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. 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.
6. Background; 2014 DOJ Report
As noted by the author, in March of 2014 the California
Department of Justice released a report entitled, Gangs Beyond
Borders California and the Fight Against Transnational Organized
Crime. That report states in part:
California is a global leader on a number of fronts
and, unfortunately, transnational criminal activity is
one of them . . . . In 2012 alone, 305 drug-related
transnational criminal organizations were found
operating in the state, including Mexico-based drug
cartels in at least 22 cities from Northern California
to the southern border. Based in part on its
population and network of interstate highways
connecting the western U.S., California is a major
portal through which drugs flow to other U.S. states
and cities, as well as Canada. California is also the
top state in the U.S. for human trafficking, due in
part to its proximity to the U.S. southwest border,
robust economy, and large immigrant population.
Finally, with a gross domestic product of $2 trillion
and substantial international trade activity,
California's economic and financial infrastructure is
often targeted for transnational criminal money
laundering schemes.
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. . .
The seizure of laundered money is essential to
disrupting and dismantling transnational criminal
operations. Currently, two provisions in California
law enable state authorities to seize laundered money:
Criminal Asset Forfeiture Provision:
Money, monetary instruments, and property derived
from criminal profiteering are subject to
forfeiture under the California Control of
Profits of Organized Crime Act. (Penal Code, §§
186-186.8.)
Civil Narcotics-Related Asset Forfeiture
Provision: Money or other things of value
(including real property) used to procure
controlled substances or to facilitate specified
narcotics offenses are subject to civil asset
forfeiture. (Health & Safety Code, § 11470.)
Significantly, both of these provisions permit the
seizure of criminal proceeds and assets only after the
commencement of formal legal proceedings, such as the
filing of a criminal complaint or indictment. This
loophole allows transnational criminal organizations
to safely remove assets that have been discovered by
law enforcement, so long as formal legal proceedings
have not yet begun. . . . (T)his loophole must be
closed. New legislation should amend California law to
permit law enforcement to temporarily freeze an
organization's illicit proceeds or property even if no
formal prosecution has commenced yet.<2>
-- END -
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<2> http://oag.ca.gov/transnational-organized-crime/ch2.
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