I
105TH CONGRESS
1ST SESSION
H. R. 1965
To provide a more just and uniform procedure for Federal civil forfeitures,
and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JUNE 19, 1997
Mr. HYDE (for himself and Mr. CONYERS) introduced the following bill; which
was referred to the Committee on the Judiciary, and in addition to the
Committees on Ways and Means, and Commerce, for a period to be sub-
sequently determined by the Speaker, in each case for consideration of
such provisions as fall within the jurisdiction of the committee concerned
A BILL
To provide a more just and uniform procedure for Federal
civil forfeitures, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Civil Asset Forfeiture Reform Act’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title and table of contents.
Sec. 2. Creation of general rules relating to civil forfeiture proceedings.
Sec. 3. Compensation for damage to seized property.
Sec. 4. Prejudgment and postjudgment interest.
Sec. 5. Seizure warrant requirement.
Sec. 6. Access to records in bank secrecy jurisdictions.
Sec. 7. Access to other records.
Sec. 8. Disclosure of grand jury information to Federal prosecutors.
Sec. 9. Use of forfeited funds to pay restitution to crime victims and regulatory
agencies.
Sec. 10. Enforcement of foreign forfeiture judgment.
Sec. 11. Admissibility of foreign business records.
Sec. 12. Conforming amendments to title 28, to rules of procedure, and to the
controlled substances act.
Sec. 13. Inapplicability of the customs laws.
Sec. 14. Applicability.
Sec. 15. Jurisdiction and venue in forfeiture cases.
Sec. 16. Minor and technical amendments relating to 1992 forfeiture amend-
ments.
Sec. 17. Drug paraphernalia technical amendments.
Sec. 18. Certificate of reasonable cause.
Sec. 19. Authorization to share forfeited property with cooperating foreign gov-
ernments.
Sec. 20. Forfeiture of property used to facilitate foreign drug crimes.
Sec. 21. Forfeiture of proceeds traceable to facilitating property in drug cases.
Sec. 22. Forfeiture of proceeds of certain foreign crimes.
Sec. 23. Civil forfeiture of coins and currency in confiscated gambling devices.
Sec. 24. Clarification of judicial review of forfeiture.
Sec. 25. Technical amendments relating to obliterated motor vehicles identifica-
tion numbers.
Sec. 26. Statute of limitations for civil forfeiture actions.
Sec. 27. Destruction or removal of property to prevent seizure.
Sec. 28. In personam judgments.
Sec. 29. Uniform procedures for criminal forfeiture.
Sec. 30. Availability of criminal forfeiture.
Sec. 31. Discovery procedure for locating forfeited assets.
Sec. 32. Criminal forfeiture for money laundering conspiracies.
Sec. 33. Correction to criminal forfeiture provision for alien smuggling and
other immigration offenses.
Sec. 34. Repatriation of property placed beyond the jurisdiction of the court.
Sec. 35. Right of third parties to contest forfeiture of substitute assets.
Sec. 36. Archeological Resources Protection Act.
Sec. 37. Forfeiture of instrumentalities of terrorism, telemarketing fraud, and
other offenses.
Sec. 38. Forfeiture of criminal proceeds transported in interstate commerce.
Sec. 39. Forfeitures of proceeds of Federal Food, Drug, and Cosmetic Act vio-
lations.
Sec. 40. Forfeiture of counterfeit paraphernalia.
Sec. 41. Closing of loophole to defeat criminal forfeiture through bankruptcy.
Sec. 42. Collection of criminal forfeiture judgment.
Sec. 43. Criminal forfeiture of property in Government custody.
Sec. 44. Delivery of property to the Marshals Service.
Sec. 45. Forfeiture for odometer tampering offenses.
Sec. 46. Pre-trial restraint of substitute assets.
SEC. 2. CREATION OF GENERAL RULES RELATING TO CIVIL
FORFEITURE PROCEEDINGS.
(a) IN GENERAL.—Chapter 46 of title 18, United
States Code, is amended by inserting the following new
section after section 982:
‘‘§ 983. Civil forfeiture procedures
‘‘(a) ADMINISTRATIVE
FORFEITURES.—(1)(A) In
any nonjudicial civil forfeiture proceeding under a civil for-
feiture statute, with respect to which the agency conduct-
ing a seizure of property must send written notice of the
seizure under section 607(a) of the Tariff Act of 1930 (19
U.S.C. 1607(a)), such notice together with information on
the applicable procedures shall be sent not later than 60
days after the seizure to each party known to the seizing
agency at the time of the seizure to have an ownership
or possessory interest, including a lienholder’s interest, in
the seized article. If a party’s identity or interest is not
determined until after the seizure but is determined before
a declaration of forfeiture is entered, such written notice
and information shall be sent to such interested party not
later than 60 days after the seizing agency’s determination
of the identity of the party or the party’s interest.
‘‘(B) If the Government does not provide notice of
a seizure of property in accordance with subparagraph
(A), it shall return the property pending the giving of such
notice.
‘‘(2) The Government may apply to a Federal mag-
istrate judge (as defined in the Federal Rules of Criminal
Procedure) in any district where venue for a forfeiture ac-
tion would lie under section 1355(b) of title 28 for an ex-
tension of time in which to comply with paragraph (1)(A).
Such an extension shall be granted based on a showing
of good cause.
‘‘(3) A person with an ownership or possessory inter-
est in the seized article who failed to file a claim within
the time period prescribed in subsection (b) may, on mo-
tion made not later than 2 years after the date of final
publication of notice of seizure of the property, move to
set aside a declaration of forfeiture entered pursuant to
section 609 of the Tariff Act of 1930 (19 U.S.C. 1609).
Such motion shall be granted if—
‘‘(A) the Government failed to take reasonable
steps to provide the claimant with notice of the for-
feiture; and
‘‘(B) the person otherwise had no actual notice
of the seizure within sufficient time to enable the
person to file a timely claim under subsection (b).
‘‘(4) If the court grants a motion made under para-
graph (3), it shall set aside the declaration of forfeiture
as to the moving party’s interest pending forfeiture pro-
ceedings in accordance with section 602 et seq. of the Tar-
iff Act of 1930 (19 U.S.C. 1602 et seq.), which proceed-
ings shall be instituted within 60 days of the entry of the
order granting the motion.
‘‘(5) If, at the time a motion under this subsection
is granted, the forfeited property has been disposed of by
the Government in accordance with law, the Government
shall institute forfeiture proceedings under paragraph (4).
The property which will be the subject of the forfeiture
proceedings instituted under paragraph (4) shall be a sum
of money equal to the value of the forfeited property at
the time it was disposed of plus interest.
‘‘(6) The institution of forfeiture proceedings under
paragraph (4) shall not be barred by the expiration of the
statute of limitations under section 621 of the Tariff Act
of 1930 (19 U.S.C. 1621) if the original publication of
notice was completed before the expiration of such limita-
tions period.
‘‘(7) A motion made under this subsection shall be
the exclusive means of obtaining judicial review of a dec-
laration of forfeiture entered by a seizing agency.
‘‘(b) FILING A CLAIM.—(1) Any person claiming such
seized property may file a claim with the appropriate offi-
cial after the seizure.
‘‘(2) A claim under paragraph (1) may not be filed
later than 30 days after—
‘‘(A) the date of final publication of notice of
seizure; or
‘‘(B) in the case of a person receiving written
notice, the date that such notice is received.
‘‘(3) The claim shall set forth the nature and extent
of the claimant’s interest in the property.
‘‘(c) FILING A COMPLAINT.—(1) In cases where prop-
erty has been seized or restrained by the Government and
a claim has been filed, the Attorney General shall file a
complaint for forfeiture in the appropriate court in the
manner set forth in the Supplemental Rules for Certain
Admiralty and Maritime Claims, or shall include a forfeit-
ure count in a criminal indictment or information, or both,
not later than 90 days after the claim was filed, or return
the property pending the filing of a complaint or indict-
ment. By mutual agreement between the Government and
the claimants, the 90-day filing requirement may be
waived.
‘‘(2) The Government may apply to a Federal mag-
istrate judge (as defined in the Federal Rules of Criminal
Procedure) in any district where venue for a forfeiture ac-
tion would lie under section 1355(b) of title 28 for an ex-
tension of time in which to comply with paragraph (1).
Such an extension shall be granted based on a showing
of good cause. If the reason for the extension is that the
filing required by paragraph (1) would jeopardize an ongo-
ing criminal investigation or prosecution or court-author-
ized electronic surveillance, the application may be made
ex parte.
‘‘(3) Upon the filing of a civil complaint, the claimant
shall file a claim and answer in accordance with the Sup-
plemental Rules for Certain Admiralty and Maritime
Claims.
‘‘(d) APPOINTMENT OF COUNSEL.—(1) If the person
filing a claim is financially unable to obtain representation
by counsel and requests that counsel be appointed, the
court may appoint counsel to represent that person with
respect to the claim. In determining whether to appoint
counsel to represent the person filing the claim, the court
shall take into account—
‘‘(A) the nature and value of the property sub-
ject to forfeiture, including the hardship to the
claimant from the loss of the property seized, com-
pared to the expense of appointing counsel;
‘‘(B) the claimant’s standing to contest the for-
feiture; and
‘‘(C) whether the claim appears to be made in
good faith or to be frivolous.
‘‘(2) The court shall set the compensation for that
representation, which shall be the equivalent to that pro-
vided for court-appointed representation under section
3006A of this title, and to pay such cost, there are author-
ized to be appropriated such sums as are necessary as an
addition to the funds otherwise appropriated for the ap-
pointment of counsel under such section.
‘‘(3) The determination of whether to appoint counsel
under this subsection shall be made following a hearing
at which the Government shall have an opportunity to
present evidence and examine the claimant. The testimony
of the claimant at such hearing shall not be admitted in
any other proceeding except in accordance with the rules
which govern the admissibility of testimony adduced in a
hearing on a motion to suppress evidence. Nothing in this
paragraph shall be construed to prohibit the admission of
any evidence that may be obtained in the course of civil
discovery in the forfeiture proceeding or through any other
lawful investigative means.
‘‘(e) BURDEN OF PROOF.—In all suits or actions
brought for the civil forfeiture of any property, the burden
of proof at trial is on the United States to establish, by
a preponderance of the evidence, that the property is sub-
ject to forfeiture. If the Government proves that the prop-
erty is subject to forfeiture, the claimant shall have the
burden of establishing any affirmative defense by a pre-
ponderance of the evidence.
‘‘(f) INNOCENT OWNERS.—(1) An innocent owner’s
interest in property shall not be forfeited in any civil for-
feiture action.
‘‘(2) With respect to a property interest in existence
at the time the illegal conduct giving rise to the forfeiture
took place, the term ‘innocent owner’ means an owner
who—
‘‘(A) did not know of the conduct giving rise to
the forfeiture; or
‘‘(B) upon learning of the conduct giving rise to
the forfeiture, did all that reasonably could be ex-
pected under the circumstances to terminate such
use of the property.
‘‘(3)(A) With respect to a property interest acquired
after the conduct giving rise to the forfeiture has taken
place, the term ‘innocent owner’ means a person who, at
the time that person acquired the interest in the property,
was a bona fide purchaser for value and was at the time
of the purchase reasonably without cause to believe that
the property was subject to forfeiture.
‘‘(B) Except as provided in paragraph (4), where the
property subject to forfeiture is real property, and the
claimant uses the property as his or her primary residence
and is the spouse or minor child of the person who com-
mitted the offense giving rise to the forfeiture, an other-
wise valid innocent owner claim shall not be denied on the
ground that the claimant acquired the interest in the prop-
erty—
‘‘(i) in the case of a spouse, through dissolution
of marriage or by operation of law, or
‘‘(ii) in the case of a minor child, as an inherit-
ance upon the death of a parent,
and not through a purchase. However, the claimant must
establish, in accordance with subparagraph (A), that at
the time of the acquisition of the property interest, the
claimant was reasonably without cause to believe that the
property was subject to forfeiture, and was an owner of
the property, as defined in paragraph (6).
‘‘(4) Notwithstanding any provision of this section,
no person may assert an ownership interest under this sec-
tion—
‘‘(A) in contraband or other property that it is
illegal to possess; or
‘‘(B) in the illegal proceeds of a criminal act
unless such person was a bona fide purchaser for
value who was reasonably without cause to believe
that the property was subject to forfeiture.
‘‘(5) For the purposes of paragraph (2) of this sub-
section a person does all that reasonably can be expected
if the person takes all steps that a reasonable person
would take in the circumstances to prevent or terminate
the illegal use of the person’s property. There is a rebutta-
ble presumption that a property owner took all the steps
that a reasonable person would take if the property
owner—
‘‘(A) gave timely notice to an appropriate law
enforcement agency of information that led to the
claimant to know the conduct giving rise to a forfeit-
ure would occur or has occurred; and
‘‘(B) in a timely fashion, revoked permission for
those engaging in such conduct to use the property
or took reasonable steps in consultation with a law
enforcement agency to discourage or prevent the ille-
gal use of the property.
The person is not required to take extraordinary steps
that the person reasonably believes would be likely to sub-
ject the person to physical danger.
‘‘(6) As used in this subsection—
‘‘(A) the term ‘civil forfeiture statute’ means
any provision of Federal law providing for the for-
feiture of property other than as a sentence imposed
upon conviction of a criminal offense;
‘‘(B) the term ‘owner’ means a person with an
ownership interest in the specific property sought to
be forfeited, including a lien, mortgage, recorded se-
curity device, or valid assignment of an ownership
interest. Such term does not include—
‘‘(i) a person with only a general unse-
cured interest in, or claim against, the property
or estate of another;
‘‘(ii) a bailee unless the bailor is identified
and the bailee shows a colorable legitimate in-
terest in the property seized; or
‘‘(iii) a nominee who exercises no dominion
or control over the property;
‘‘(C) a person shall be considered to have
known that the person’s property was being used or
was likely to be used in the commission of an illegal
act if the person was willfully blind.
‘‘(7) If the court determines, in accordance with this
subsection, that an innocent owner had a partial interest
in property otherwise subject to forfeiture, or a joint ten-
ancy or tenancy by the entirety in such property, the court
shall enter an appropriate order—
‘‘(A) severing the property;
‘‘(B) transferring the property to the Govern-
ment with a provision that the Government
compensate the innocent owner to the extent of his
or her ownership interest once a final order of for-
feiture has been entered and the property has been
reduced to liquid assets; or
‘‘(C) permitting the innocent owner to retain
the property subject to a lien in favor of the Govern-
ment, to the extent of the forfeitable interest in the
property, that will permit the Government to realize
its forfeitable interest if the property is transferred
to another person.
To effectuate the purposes of this subsection, a joint ten-
ancy or tenancy by the entireties shall be converted to a
tenancy in common by order of the court, irrespective of
state law.
‘‘(8) An innocent owner defense under this subsection
is an affirmative defense.
‘‘(g) MOTION TO SUPPRESS SEIZED EVIDENCE.—At
any time after a claim and answer are filed in a judicial
forfeiture proceeding, a claimant with standing to contest
the seizure of the property may move to suppress the
fruits of the seizure in accordance with the normal rules
regarding the suppression of illegally seized evidence. If
the claimant prevails on such motion, the fruits of the sei-
zure shall not be admitted into evidence as to that claim-
ant at the forfeiture trial. However, a finding that evi-
dence should be suppressed shall not bar the forfeiture of
the property based on evidence obtained independently be-
fore or after the seizure.
‘‘(h) USE OF HEARSAY AT PRE-TRIAL HEARINGS.—
At any pre-trial hearing under this section in which the
governing standard is probable cause, the court may ac-
cept and consider hearsay otherwise inadmissible under
the Federal Rules of Evidence.
‘‘(i) STIPULATIONS.—Notwithstanding the claimant’s
offer to stipulate to the forfeitability of the property, the
Government shall be entitled to present evidence to the
finder of fact on that issue before the claimant presents
any evidence in support of any affirmative defense.
‘‘(j) PRESERVATION
OF PROPERTY SUBJECT
TO
FORFEITURE.—The court, before or after the filing of a
forfeiture complaint and on the application of the Govern-
ment, may—
‘‘(1) enter any restraining order or injunction
in the manner set forth in section 413(e) of the Con-
trolled Substances Act (21 U.S.C. 853(e));
‘‘(2) require the execution of satisfactory per-
formance bonds;
‘‘(3) create receiverships;
‘‘(4) appoint conservators, custodians, apprais-
ers, accountants or trustees; or
‘‘(5) take any other action to seize, secure,
maintain, or preserve the availability of property
subject to forfeiture under this section.
‘‘(k) EXCESSIVE FINES.—(1) At the conclusion of the
trial and following the entry of a verdict of forfeiture, or
upon the entry of summary judgment for the Government
as to the forfeitability of the property, the claimant may
petition the court to determine whether the excessive fines
clause of the Eighth Amendment applies, and if so, wheth-
er forfeiture is excessive. The claimant shall have the bur-
den of establishing that a forfeiture is excessive by a pre-
ponderance of the evidence at a hearing conducted in the
manner provided in Rule 43(e), Federal Rules of Civil
Procedure, by the Court without a jury. If the court deter-
mines that the forfeiture is excessive, it shall adjust the
forfeiture to the extent necessary to avoid the Constitu-
tional violation.
‘‘(2) The claimant may not object to the forfeiture
on Eighth Amendment grounds other than as set forth
in paragraph (1), except that a claimant may, at any time,
file a motion for summary judgment asserting that even
if the property is subject to forfeiture, the forfeiture would
be excessive. The court shall rule on such motion for sum-
mary judgment only after the Government has had an op-
portunity—