Criminal Restitution Proposals in the 110th Congress
Released: 2009-01-13T00:00:00

Summary:
Congress enacted two restitution provisions in the 110th Congress, one as part of the Identity Theft Enforcement and Restitution Act of 2008 (Title II of P.L. 110-326)(H.R. 5938), and the other as part of the Prioritizing Resources and Organization for Intellectual Property Act of 2008 (P.L. 110-403)(S. 3325). It devoted considerable time and attention to other restitution proposals as well.
Restitution legislation in the 110th Congress fell into three categories. Some proposals, such as two provisions enacted, create or would have created new federal crimes or amend specific existing federal offenses and in doing so include restitution provisions particular to those offenses, e.g., P.L. 110-326 (intellectual property), P.L. 110-403 (identity theft); H.R. 880, H.R. 1582, H.R. 1692, S. 456, and S. 990 (gang bills); H.R. 6491 (organized retail offenses), H.R. 3148 (Mann Act), H.R. 3990 (sexual military offenses), and H.R. 871 (spousal support offenses). Other proposals would have addressed a particular aspect of the law such as abatement which limits restitution collection after the defendant's death (S. 149/H.R. 4111). Two bills – H.R. 845, the Criminal Restitution Improvement Act, and S. 973/H.R. 4110, the Restitution for Victims of Crime Act – sought to make substantial changes in federal restitution law. They anticipated three kinds of adjustments: (1) an expansion of offenses for which restitution may be ordered without recourse to the laws relating to probation and supervised release; (2) an overhaul of the procedures governing the issuance and enforcement of restitution orders to afford prosecutors greater enforcement flexibility without having to seek the approval of the sentencing court; and (3) authority for preindictment and presentencing restraining orders and other protective measures to prevent dissipation of assets by those who may subsequently owe restitution. Although similar in many respects, S. 973/H.R. 4110 more closely resembles the proposals transmitted by the Justice Department. The provisions of H.R. 845 also appeared as Title V of the Violent Crime Control Act of 2007 (H.R. 3156/S. 1860); most of the language in S. 973/H.R. 4110 also appeared in Title VII of a subsequently tabled version of the Commerce, Justice, Science appropriations bill (H.R. 3903).
This report is available in an abridged form – without footnotes, citations to most authorities and appendices – as CRS Report RS22709, Criminal Restitution in the 110th Congress: A Sketch. Related reports include CRS Report RL34138, Restitution in Federal Criminal Cases, available in abridged form as CRS Report RS22708, Restitution in Federal Criminal Cases: A Sketch, all by [author name scrubbed].

subsections: section_title: Introduction
paragraphs: Restitution is the act of restoring an individual or entity in whole or in part to the lost circumstances they might have once enjoyed. In a federal criminal context, it is the order of a sentencing court directing a defendant to reimburse or otherwise compensate the victims of his crimes. Federal courts have no inherent authority to award restitution; they may do so only pursuant to statute.
There are four general statutory sources of such authority. Under 18 U.S.C. 3663A, federal courts must order restitution when sentencing a defendant convicted of a crime of violence, of a crime against property or fraud or deceit that is proscribed in Title 18 of the United States Code, of maintaining drug-involved premises, of product tampering, or certain intellectual property offenses. Under 18 U.S.C. 3663, if restitution is not otherwise mandatory under Section 3663A, federal courts may nonetheless order restitution when sentencing a defendant convicted of an offense proscribed in Title 18 of the United States Code, or of various drug or aviation safety offenses. Under 18 U.S.C. 3563(b)(2), federal courts may make restitution a condition of probation. Under 18 U.S.C. 3583(d), they may make restitution a condition of supervised release. There are a handful of statutes that contain special restitution coverage for losses associated with particular crimes such as the failure to provide child support, 18 U.S.C. 228(d). The procedure for the exercise and implementation of federal restitution authority is set forth in large measure in 18 U.S.C. 3664, 18 U.S.C. 3611-3614, and to a lesser extent in 18 U.S.C. 3572.
Restitution is based on the losses suffered by the victims of a crime. Neither the defendant's financial condition at the time of sentencing nor his future economic prospects figure in the amount of restitution awarded. Consequently, in some cases, particularly those in which a restitution order is mandatory, the amount of restitution ordered may exceed what the defendant can ever reasonably be expected to pay. Nevertheless, there have been suggestions that in other instances insufficient restitution has been ordered or collected because of the particularities of restitution law.
Restitution legislation in the 110 th Congress falls into three categories. Some proposals such as the gang crime bills would have create new federal crimes or amend specific existing federal offenses and in doing so include restitution provisions particular to those offenses. Other proposals addressed the consequences of abatement, the legal fiction under which a conviction and all of its consequences including restitution are washed away when the defendant dies during the pendency of his appeal. Still others would have provided for more general revisions of existing law in the area.
section_title: Newly Enacted Restitution Provisions
subsections: section_title: Intellectual Property Offenses
paragraphs: Restitution is a required consequence of a conviction for an offense against property proscribed in title 18 of the United States Code ("include crimes committed by fraud or deceit"). By virtue of section 206 of the Prioritizing Resources and Organization for Intellectual Property Act of 2008, P.L. 110-403 , 122 Stat. (2008), conviction for any of a number of intellectual property offenses also results in a mandatory restitution order. The same procedures apply as would in the case of other property offenses subject to mandatory restitution orders under the general provisions of 18 U.S.C. 3556, 3663A and 3664. The crimes covered by the new provision are proscribed in:
17 U.S.C. 506 (copyright infringement)
18 U.S.C. 2318 (trafficking in counterfeit labels)
18 U.S.C. 2319 (copyright infringement)
18 U.S.C. 2319A (trafficking in sound records)
18 U.S.C. 2319B (unauthorized motion picture recording)
18 U.S.C. 2320 (trafficking in counterfeit goods)
18 U.S.C. 1831 (economic espionage)
18 U.S.C. 1832 (theft of trade secrets).
section_title: Identity Theft
paragraphs: The Identity Theft Enforcement and Restitution Act, among other things, authorizes federal courts to order restitution for the victims of identity theft (18 U.S.C. 1028(a)(7)) and aggravated identity theft (18 U.S.C. 1028A(a)) to compensate them for the time reasonably spent to undo the harm caused or intended by the theft.
section_title: Restitution for New or Existing Crimes
subsections: section_title: Military Crimes
paragraphs: Rape, sexual assaults, and other sexual offenses, as well as violations of civilian court protective orders are crimes under the United States Code of Military Justice, 10 U.S.C. 920, 1561a. Section 234 of Military Domestic and Sexual Violence Response Act ( H.R. 3990 )(Representative Slaughter) would have added a mandatory restitution provision for the benefit of the victims of such offenses, proposed 10 U.S.C. 1561c.
section_title: Organized Retail Crime
paragraphs: H.R. 6491 (Representative Ellsworth) would have made organized retail crime a federal offense, proposed 18 U.S.C. 2315. One of the consequences of conviction would have been a mandatory restitution order issued under the general mandatory restitution procedures of 18 U.S.C. 3556, 3663A and 3664, proposed 18 U.S.C. 2315(4).
section_title: Gang Crimes
paragraphs: Existing federal law outlaws the commission of various federal crimes by street gangs. There were a number of proposals to amend or augment the existing federal offense. They included H.R. 880 (Representative Forbes), H.R. 1582 (Representative Schiff), H.R. 1692 (Representative Pallone), S. 456 (Senator Feinstein), S. 990 (Senator Menendez). In each instance, the proposals would have permitted the courts to order restitution as part of the sentence imposed for violation of their newly created or newly amended offenses.
section_title: Travel for Illicit Sexual Purposes
paragraphs: At least three chapters in title 18 of the United States Code prohibit sexual misconduct. Chapter 109A condemns rape and similar forms of sexual abuse, 18 U.S.C. 2241-2248. Chapter 110 outlaws sexual exploitation of children and other forms of child abuse, 18 U.S.C. 2251-2260A. Chapter 117 proscribes interstate travel for illicit sexual purposes, 18 U.S.C. 2421-2428. Chapters 109A and 110 each have individual mandatory restitution provisions, 18 U.S.C. 2248, 2259. Chapter 117 has no comparable provision, although the courts enjoy discretion to order restitution under 18 U.S.C. 3663 or as a condition of probation or supervised release, 18 U.S.C. 3563(b)(2), 3583(d). H.R. 3148 (Representative Musgrave) would have added a mandatory restitution provision to chapter 117, proposed 18 U.S.C. 2429.
section_title: Spousal Support
paragraphs: Existing federal law outlaws certain failures to pay child support and requires the court to award restitution upon conviction. H.R. 871 (Representative Wexler) proposed to outlaw the failure to pay court-ordered spousal property distribution and would have required the court to award restitution upon conviction.
section_title: Abatement
paragraphs: On October 17, 2006, a federal district court in Houston, Texas, vacated the conviction of, and dismissed the indictment of, former Enron executive Kenneth Lay. At the same time, it refused to order restitution for the victims of the crimes for which he had been convicted. Mr. Lay had died shortly after his conviction and the court felt that the doctrine of abatement recognized by the Fifth Circuit compelled its action.
The Supreme Court once observed that the lower federal courts had consistently and correctly held that "death pending direct review of a criminal conviction abates not only the appeal but also all proceedings had in the prosecution from its inception," Durham v. United States , 401 U.S. 481 (1971). While its earlier practice had been to dismiss and remand upon the death of a petitioner pending a grant of certiorari, the Durham Court indicated that it did not consider important the distinction between death pending appeal and death pending a petition for certiorari, Id. at 483 n.* Later and without further explanation, the Court dismissed the petition for certiorari of a man who had died while his petition was pending. In doing so, it expressly overruled Durham to the extent of any inconsistency, Dove v. United States , 423 U.S. 325 (1976).
Since then, the lower federal courts have read Dove to mean that abatement does not apply to petitions for certiorari, but have continued to adhere to their earlier general rule on abatement: upon the death of a defendant pending appeal the courts treat his indictment and conviction as if they had never occurred. The case is returned to the lower federal court with instructions to vacate the conviction and to dismiss the indictment. The circuit courts are somewhat more divided on the question of whether a restitution order likewise abates upon the death of the defendant pending appeal.
In the twilight of the 109 th Congress, the Senate passed legislation that would have barred abatement of a restitution order. The bill's sponsor, Senator Feinstein, re-introduced essentially the same proposal as S. 149 in the 110 th Congress, which Representative Shea-Porter introduced in the House as H.R. 4111 . There was no further action in the 110 th Congress.
Except for restitution and civil forfeiture, S. 149 / H.R. 4111 would have replicated common law abatement for sentencing purposes. The obligation to pay fines and special assessments and apparently to honor conditions of probation or supervised release would have died with the defendant. S. 149 / H.R. 4111 would not, however, have obligated the government to return funds received in payment of the defendant's fine, special assessment or criminal forfeiture. For civil forfeitures, S. 149 / H.R. 4111 would have eased the applicable statute of limitations and denied the application of abatement doctrine to civil forfeiture cases.
For restitution, it would have essentially ignored the defendant's death. More precisely, it would have allowed for substitution of the defendant's representative and permitted restitution-related proceedings to continue as if the defendant were still alive. If the defendant, died after conviction but before being sentenced, S. 149 / H.R. 4111 would have authorized a sentencing hearing and restitution order, with little said about exactly what procedures were to be followed. Thereafter, or if the defendant died after having been sentenced, the appellate process would have remained open to the defendant's representative, victims, and the government for restitution-related matters.
The abatement doctrine does not apply when the defendant dies after all appeals have been exhausted, but S. 149 / H.R. 4111 would have addressed the question. It would have allowed for the issuance or continuation of any protective orders designed to prevent dissipation of assets that might be used to pay restitution. Even more interestingly, it would seem to have established a collection method reminiscent of forfeiture of estate and corruption of the blood:
If restitution has not been fully collected on the date on which a defendant convicted in a criminal case dies – (i) any amount owed under a restitution order (whether issued before or after the death of that defendant) shall be collectible from any property from which the restitution could have been collected if that defendant had survived, regardless of whether that property is included in the estate of the defendant .
The provision seems straightforward enough for property or property interests held by the defendant at the time of his death. It becomes more intriguing for property or property interests that would otherwise have passed through the defendant to his heirs at some point after his death.
The Constitution denies Congress the power to punish treason with corruption of the blood or forfeiture of estate. Story lays out the background and reasons for the prohibition in his Commentaries:
It is well known, that corruption of blood, and forfeiture of the estate of the offender followed, as a necessary consequence at common law upon every attainder of treason. By corruption of blood all inheritable qualities are destroyed; so, that an attainted person can neither inherit lands, nor other hereditament from his ancestors, not retain those, he is already in possession of, nor transmit them to any heir. And this destruction of all inheritable qualities is so complete, that it obstructs all descents to his posterity, whenever they are obliged to derive a title through him to any estate of a remote ancestor. So, that if a father commits treason, and is attainted, and suffers death, and then the grandfather dies, his grandson cannot inherit any estate from his grandfather; for he must claim through his father, who could convey to him no inheritable blood. . .. In addition, to this most grievous disability, the person attainted forfeits, by the common law, all his lands, and tenements, and rights of entry, and rights of profits in lands or tenements, which he possesses. . .. But this view of the subject is wholly unsatisfactory. It looks only to the offender himself, and is regardless of his innocent posterity. It really operates, as a posthumous punishment upon them; and compels them to bear, not only the disgrace naturally attendant upon such flagitious crimes; but takes from them the common rights and privileges enjoyed by all other citizens, where they are wholly innocent, and however remote they may be in the lineage from the first offender. III Story, Commentaries on the Constitution of the United States 170-71, 172 (1833).
Some courts have suggested that the due process clause embodies a comparable proscription against the use of forfeiture of estate and corruption of the blood as a punishment for other crimes. This view may gather some support from the fact that when the first Congress assembled it enacted a similar proscription for other crimes which continued in place for almost two centuries.
S. 149 / H.R. 4111 had one other interesting feature. Its amendments were to have been effective with respect to "any criminal case or appeal pending on or after July 1, 2007," that is, to crimes occurring prior to that date as long as the prosecution or appeal was still pending then. The ex post facto clause of the Constitution generally forbids the retroactive application of criminal laws. The lower federal appellate courts are divided over the question of whether the Constitution's ex post facto clause permits retroactive application of restitution amendments.
section_title: General Revisions
paragraphs: Two bills – H.R. 845 , the Criminal Restitution Improvement Act, introduced by Representative Chabot, and S. 973 / H.R. 4110 , the Restitution for Victims of Crime Act, introduced by Senator Dorgan in the Senate and Representative Shea-Porter in the House – would have substantially changed federal restitution law. The bills reflected a Justice Department legislative proposal transmitted in the second session of the 109 th Congress in identical letters to then House Speaker Hastert and to the President of the Senate, Vice President Cheney, which included a draft bill and accompanying section-by-section analysis. The proposals called for three kinds of modifications: (1) an expansion of offenses for which restitution may be ordered without recourse to the laws relating to probation and supervised release; (2) an overhaul of the procedures governing the issuance and enforcement of restitution orders to afford prosecutors greater enforcement flexibility without having to seek the approval of the sentencing court; and (3) authority for preconviction and presentencing restraining orders and other protective measures to prevent dissipation of assets by those who may subsequently owe restitution. Although similar in many respects, S. 973 / H.R. 4110 more closely resembled the proposals transmitted by the Justice Department.
H.R. 845 would have increased the number of crimes for which mandatory restitution was authorized; S. 973 / H.R. 4110 would have increased the number for which discretionary restitution was authorized. They used virtually identical language to establish a protective order mechanism in order to prevent the dissipation of assets prior to conviction that might otherwise be available for purposes of restitution. While H.R. 845 would have recast 18 U.S.C. 3664 which governs much of how federal restitution orders are crafted and executed, S. 973 / H.R. 4110 would have taken a more selective approach, weaving its alterations into the fabric of existing statute.
subsections: section_title: Mandatory Restitution (H.R. 845)
paragraphs: H.R. 845 would have replaced the discretionary and mandatory restitution provisions of sections 3663 and 3663A with mandatory provisions under a revised section 3663. In doing so, it would have changed the class of victims for whom restitution must be ordered; it would have changed the crimes for which restitution must be ordered; and it would have changed the types of injuries and losses for which restitution must be ordered.
subsections: section_title: Qualifying Offenses
paragraphs: Existing law requires restitution for crimes of violence, maintaining a drug-involved premises, and, when prohibited in Title 18, fraud and crimes against property. It permits a court to order restitution for crimes otherwise proscribed in Title 18, as well as various aviation safety and drug offenses, and as a condition for probation and supervised release. It does not permit restitution orders in the case of most securities offenses, environmental offenses, drug offenses, or most of the other property crimes outlawed in other titles of the Code.
H.R. 845 would have required restitution for all federal offenses: "The court shall order a convicted defendant to make restitution for all pecuniary loss to identifiable victims, including pecuniary loss resulting from physical injury to, or the death of, another, proximately resulting from the offense." Other than through its definition of "victim" (person suffering a pecuniary loss proximately caused by an offense) and its description of types of injuries and loss its covers (pecuniary losses including those related to physical injury proximately caused by an offense), H.R. 845 did not further define the "offenses" that require mandatory restitution. It almost certainly was intended to cover any criminal offense proscribed by Act of Congress and triable before a court established under Article III of the Constitution. The suggestion that it was also intended to embrace tribal, military, and/or territorial offenses and/or relevant conduct related to any qualifying offenses seemed conceivable but not very likely.
section_title: Qualifying Victims
paragraphs: Existing law defines "victims" for purposes of mandatory restitution under section 3663A as (1) those designated victims in a plea agreement, (2) the estate of deceased victims, (3) those directly and proximately harmed by a qualifying offense, (4) those harmed by the scheme, conspiracy, or pattern of criminal activity of a defendant convicted of a qualifying offense which has as one of its elements such a scheme, conspiracy, or pattern of criminal activity, and (5) in the case of children, the incompetent, incapacitated, or deceased: legal guardians, family members, and other representatives.
H.R. 845 would have defined the five classes of victims entitled to mandatory restitution somewhat differently to encompass:
•    Identifiable individuals and entities who suffer a pecuniary loss proximately caused by the offense,
•    Identifiable individuals and entities who suffer a pecuniary loss as a consequence of a physical injury to another proximately caused by the offense,
•    The successors to any such direct or third party victims,
•    Anyone the parties agree to in a plea bargain, and
•    Anyone otherwise provided by law.
Like existing law, H.R. 845 would have permitted restitution for a wider range of victims pursuant to a plea bargain. Furthermore, H.R. 845 would have insisted upon restitution for those who suffer losses as a proximate cause of a qualifying offense, even though it envisioned a wider range of qualifying offenses than recognized under existing law. Third, in somewhat varied terms, H.R. 845 would have admitted the possibility that, faced with a host of victims or an exceedingly complex factual environment, full restitution for all victims need not be required.
Perhaps the most obvious difference produced by H.R. 845 's description of the victims entitled to restitution was its silence on the extent to which victims of misconduct collateral to the crime of conviction could have been entitled to restitution. Section 3663A now requires restitution for a limited class of individuals who are not victims of the defendant's crime of conviction strictly speaking. That is, it recognizes as a victim entitled to restitution "any person directly harmed by the defendant's criminal conduct in the course of [a] scheme, conspiracy or pattern," if the offense "involves as an element a scheme, conspiracy, or pattern of criminal activity." Under this provision, victims of the same scheme but of a different episode of the scheme than that for which the defendant was convicted may be entitled to restitution. There was no comparable language in H.R. 845 .
The second major difference flowed from H.R. 845 's depiction of those who do not fit the traditional concept of primary victims, but who are entitled to restitution nonetheless. Existing law treats a victim's estate as the victim if the victim is dead. If the victim is a child, incompetent, or incapacitated, existing law allows the victim's legal guardian, a member of the victim's family, or a court appointed representative to assume the victim's interest. Existing law also realizes that parents, insurance carriers, and other third parties who assume or provide compensation for the victim's losses, may be entitled to restitution.
H.R. 845 would have replicated the provision of existing law covering insurance carriers and similarly situated third parties and when restitution takes the form of in-kind services, but otherwise spoke simply of successors and those who suffer losses as a result of physical injuries to another proximately caused by defendant's crime. H.R. 845 made no express mention of the victim's estate or representative or of the assumption of the victim's rights.
Some courts may have felt that the change was intended to mean that the right of victims to restitution dies with them, although their parents and estates may be entitled to restitution for related costs which they incur. On the other hand, it may have been that the bill contemplated that the estate and heirs of a deceased victim would be considered the victim's "successors," and therefore entitled to restitution in the victim's stead. Conversely, at least in the case of human victims, the classification of successors as victims could have been intended to signal no more than the fact that victims might assign their right to restitution, if only during their lifetime.
H.R. 845 would not have classified as victims those who were otherwise provided for by law. It would have repealed some, but not all, of the existing individual restitution statutes that provide alternative coverage. Gone would have been the individual restitution statutes governing human trafficking, sexual abuse, sexual exploitation of children, domestic violence, and telemarketing fraud. Continuing on would have been the probation, supervised release, or animal enterprise restitution provisions. Victims as defined in the survivors statutes, and other similarly situated statutes were presumably what was meant when H.R. 845 spoke of victims as otherwise provided by law.
section_title: Qualifying Losses
paragraphs: Existing law treats the restitution for property losses in one way (return and/or payment of the lost value) and the restitution for crime-related physical injuries in another (coverage of medical expenses, costs of rehabilitation, funeral costs when victim has been killed, and the victims' expenses relating to their participation in the investigation and prosecution of the qualifying offense).
H.R. 845 essentially would have merged the two, eliminating the distinction and expanding coverage. It called for restitution regardless of the nature of the crime – fraud, property damage, or physical injury offenses. Its vindication expenses clause ran parallel to existing law, but would have made specific allowance to cover the costs of attorneys other than those employed by the government. It would have carried forward the language under which restitution orders must include "in the case of an offense resulting in the death of the victim, an amount equal to the cost of necessary funeral and related services." And it would have used the same language to describe restitution for lost income, medical expenses, and the cost of rehabilitation – with a difference. Existing law makes them a matter of mandatory restitution only with respect to offenses involving physical injuries; H.R. 845 would have recognized no such distinction.
As noted earlier, H.R. 845 would have expressly repealed the individual restitution provisions now found in 18 U.S.C. 1593 (human trafficking), 2248 (sexual abuse), 2259 (sexual exploitation of children), 2264 (domestic violence), and 2327 (telemarketing fraud). Since it would have extended mandatory restitution to all federal offenses, the most obvious implication of the amendment would have been a change in the type of losses which qualify for restitution.
For instance, the human trafficking, sexual abuse, sexual exploitation, and domestic violence sections in existing law cover necessary transportation, temporary housing, and child care expenses, as well as attorney fees, generally. H.R. 845 only would have covered them when they has been "incurred during participation in the investigation and prosecution of the offense or attendance at proceedings relating to the offense." The trafficking section also has an income loss calculation unknown to the bill. H.R. 845 would have left as they stand the individual features of 18 U.S.C. 43(c) (animal enterprise terrorism) which authorize restitution orders covering a range of economic damages that appear to be beyond H.R. 845 's reach.
When H.R. 845 merged sections 3663 and 3663A into a revised section 3663 it would have repealed sub silentio subsection 3663(c) which permits a restitution order in favor of state victim assistance and drug agencies upon a conviction for various controlled substance offenses.
With the merger, H.R. 845 presumably intended to bring individual restitution laws such as 18 U.S.C. 228(d) (failure to pay child support) which would have continued to cross reference section 3663A within the coverage of the new section 3663. Those laws define the losses for which restitution may be ordered solely by their cross references to section 3663A (repealed by the bill). Since the bill would have provided for mandatory restitution upon conviction for any federal offense, presumably including violations of 18 U.S.C. 228 and any other statute carrying similar obsolete baggage, the failure to adjust the references to section 3663A may well have been a harmless scrivener's error.
section_title: Discretionary Restitution (S. 973/H.R. 4110)
subsections: section_title: Qualifying Offenses
paragraphs: S. 973 / H.R. 4110 's expansion of authority to order restitution would have been far more selective than that of H.R. 845 . Under 18 U.S.C. 3663 of present law, federal courts may, but need not, order restitution following conviction for crimes for which mandatory restitution is not required and which are proscribed in Title 18 of the United States Code and for various drug and aviation safety statutes. S. 973 / H.R. 4110 would have amended section 3663 to permit a federal court to order restitution following conviction for any of a series of environmental crimes:
•    33 U.S.C. 1319(c)(2), (3) (Federal Water Pollution Control Act offenses);
•    33 U.S.C. 1415(b)(Marine Protection, Research, and Sanctuaries Act offenses);
•    33 U.S.C. 1908(a) (Act to Prevent Pollution from Ships offenses);
•    42 U.S.C. 300h-2, 300i-1 (Safe Drinking Water Act offenses);
•    42 U.S.C. 6928 (Solid Waste Disposal Act offenses); and
•    42 U.S.C. 7413(c)(1), (5) (Clean Air Act offenses).
The Justice Department's Analysis notes that in spite of the fact that various environmental felonies can result in economic loss, physical injury, and even death, restitution can only be awarded the victims of various environmental felonies as a condition of probation or supervised release. It also suggests that a close examination of the legislative history of 18 U.S.C. 3663 demonstrates that the rationale for excluding various economic and other regulatory offenses from the list of qualified offenses cannot easily be applied to the environmental offenses.
section_title: Qualifying Losses
paragraphs: S. 973 / H.R. 4110 would have amended the discretionary and mandatory restitution provisions of sections 3663 and 3663A to permit victims to recover related attorney fees, other than those of government attorneys, incurred in an effort to retrieve their damaged, lost, or stolen property.
section_title: Procedural Adjustments (H.R. 845)
subsections: section_title: Primacy of Judicial Installment Schedules
paragraphs: The procedure for issuing a restitution order is laid out in 18 U.S.C. 3664. Following conviction, a probation officer conducts an investigation, collects information from the prosecutor, victims and defendant, and prepares a report for the court which is shared with the parties. The court conducts a hearing to resolve any questions relating to whether a particular individual is a victim entitled to restitution, whether a particular loss is one that qualifies for restitution, and the specifics of the defendant's ability to pay. Court-issued restitution orders may direct the defendant to pay in a lump sum, in installments, in-kind or in some combination of the three. Until full restitution is made, the court may modify its order to reflect any change in the defendant's financial circumstances.
The Justice Department contends that the role which the statute assigns to the courts impedes effective collection of restitution and has recommended amendments:
[S]ome circuit courts of appeal have interpreted one clause in 18 U.S.C. 3664(f)(2) . . . to require that a mandatory payment schedule be set at the time of sentencing. Therefore, the current legislative scheme impedes the effective enforcement of criminal monetary penalties, including restitution. The enforcement of restitution would be enhanced substantially if Congress were to amend 18 U.S.C. 3664(f)(2) to clarify that restitution is due immediately upon the imposition of a restitution order. . .. Another major change to the statute clarifies that a payment schedule set by a court at sentencing is only a minimum obligation of the offender. Current 18 U.S.C. 3664(f)(2) has undermined the efforts of the United States to enforce restitution because courts of appeal have interpreted it to require the imposition, at every sentencing, of an exclusive court-imposed payment plan. This limits the ability of the United States to enforce restitution using other available civil and administrative enforcement methods. As a result, district courts generally impose minimal payment plans upon the defendant that cannot thereafter be changed except by the court and upon a showing of a substantial change in the defendant's economic circumstances. Letter at 1.
The appellate decisions to which the Letter alludes have held that the sentencing court must set any installment payment schedule. It may not make "restitution due and payable immediately" when the defendant had no realistic means of complying. "Such an arrangement effectively transfers the district court's responsibility for setting a restitution schedule to the probation office [or to prison authorities], which is inconsistent with the statute."
Both H.R. 845 and S. 973 / H.R. 4110 would have amended section 3664 to meet the Justice Department's objections. Section 3664(f) now states that "the court shall order restitution to each victim in full. . .." And "the court shall , pursuant to section 3572, specify in the restitution order the manner in which, the schedule according to which, the restitution is to be paid. . .." Under H.R. 845 , this language would have disappeared and been replaced with a statement that "[u]pon determination of the amount of restitution owed to each victim, the court shall order that the full amount of restitution is due and payable immediately ." Furthermore "The court may provide for payment in installments according to a schedule. . .." And "The Attorney General may collect and apply unreported or otherwise newly available assets to the payment of restitution, without regard to any installment payment provisions ."
All of which appears to mean that H.R. 845 's amendments were intended to permit the court to establish a payment schedule, but to allow the government to formulate one if the court did not. Moreover, the fact that the court had established a payment schedule would not have prevented the government from supplementing the effort with other collection measures taken without the need to seek the sentencing court's approval.
section_title: Presentencing Report
paragraphs: H.R. 845 would have amended section 3664 in a number of other ways, some of which appear in the earlier recommendations of the Justice Department and some of which do not. Present law gives the prosecutor 60 days prior to the date set for sentencing to supply the probation officer with a list of the victims of the crime of conviction and the amounts of their losses. H.R. 845 would have relaxed the provision striking the time deadline. Unlike existing law, it would have insisted that the report be shared with victims upon their request.
H.R. 845 would have dropped the statement now found in section 3664(c) that identifies the external provisions of law that govern the proceedings. The omission may have been intended merely to eliminate a redundancy, but it may do a little more. Among the provisions now said to govern the proceedings is Rule 32(c)(2) of the Federal Rules of Criminal Procedure, which states that, "The probation officer who interviews a defendant as part of a presentence investigation must, on request, give the defendant's attorney notice and a reasonable opportunity to attend the interview." The omission may have been intended to indicate that the probation officer is no longer required to invite the defendant's attorney to interviews with the defendant conducted for restitution information-gathering purposes. On the other hand, H.R. 845 would neither have repealed nor amended the Rule, and on its face it would have required an invitation whether the presentence investigation interview were related to restitution or some other sentencing issue.
section_title: Restitution Orders
paragraphs: Under existing law, the court may consider a defendant's financial circumstances when deciding how and when restitution must be paid. It may not consider them when deciding whether and in what amounts its must be paid. Perhaps to avoid confusion, H.R. 845 would have stricken the language in section 3664 that now instructs the court to ignore the defendant's ability to pay when crafting the restitution order. The general tenor of the bill, however, belies any intent to have allowed a court to reduce the amount of restitution it might otherwise award based on the defendant's economic circumstances.
As with existing law, the timing and scheduling of the defendant's restitution payments under the order must be based on the defendant's obligations and resources (present and anticipated). The court could still have made multiple defendants jointly and severally liable for restitution, although H.R. 845 would have pruned the court's authority to apportion restitution among multiple defendants. In the case of multiple victims, H.R. 845 would have used a compressed style to the same effect as existing law. It used the same approach when providing for restitution for insurance carriers and similarly situated third parties.
Defendants would have continued to have the opportunity and obligation to notify the court and the government of any change in their financial situation. H.R. 845 would have added a further requirement that victims notify the court if they change their name or mailing address. It would have also amended existing law to prolong a defendant's probationary period and term of supervised release as long as restitution is still owed, although during the extension the obligation to pay restitution is the only condition that remains in effect.
H.R. 845 would have accepted without change most of the existing mechanisms for enforcing restitution orders. This would have included liens on the defendant's property that can be enforced either by the government or the victim, the authority of probation officers to enforce in-kind restitution orders, and the estoppel provision that would have precluded the defendant from challenging any of the underlying facts of the crime of conviction in related civil litigation. In addition, H.R. 845 would have empowered the court to order the defendant to take action to facilitate restitution including the reparation of assets located overseas. In a later section, it would have created a new enforcement mechanism under which it vests the courts with authority to freeze the property of defendants and potential defendants before indictment or sentencing in order to ensure the preservation of their assets for restitution purposes.
section_title: Procedural Adjustments (S. 973/H.R. 4110)
subsections: section_title: Enforcement Flexibility
paragraphs: Like H.R. 845 , more than a few of S. 973 / H.R. 4110 's amendments were crafted to provide alternatives to direct involvement of the court in restitution enforcement. Some addressed the courts' exclusive control of the scheduling of installment payments; others the availability of the Bureau of Prisons Inmate Financial Responsibility Programs; still others the collection authority of the government during the pendency of appeals.
The approach of S. 973 / H.R. 4110 to judicial scheduling of installment payments was much like that of H.R. 845 . S. 973 / H.R. 4110 would have declared, "the court shall order that the restitution imposed is due in full immediately upon imposition." The statement in existing law that "the court shall . . . specify in the restitution order the manner in which, and the schedule according to which, the restitution is to be paid" would have given way to a statement in S. 973 / H.R. 4110 that, "the court may . . . direct the defendant to make . . . partial payments at specified intervals. . .."
section_title: Inmate Financial Responsibility Program
paragraphs: This Bureau of Prisons program is designed to ensure that federal inmates meet their financial responsibilities and requires them to have a financial plan to meet those obligations from the money they earn from prison work assignments if nothing else. Under the program's priority, court-ordered restitution payments rank second after special assessments. Failure to comply with the demands of the program can result in a loss of various benefits and privileges.
The Justice Department's Analysis claims that appellate decisions requiring sentencing courts to maintain control over installment payment plans "effectively prohibits the BOP from enforcing final restitution orders through its long established IFRPs." Some may find this a bit of an overstatement, since some courts appear to consider the Inmate Financial Responsibility Program an appropriate mechanism for enforcing inmate restitution obligations; they merely read the statute to insist that the court rather than the Bureau of Prisons set the payment schedule.
In any event, S. 973 / H.R. 4110 would have amended section 3664 using language that appeared to permit the court to delegate scheduling to prison officials, but also allows prison authorities to trump conflicting court instructions. In addition, S. 973 / H.R. 4110 would have amended the nominal installment payment feature in present law to reflect the $100 per year minimum and priority of special assessments found in the prison program. The Justice Department Analysis also anticipated that the change would revive what they believe has become a dormant nominal installment provision.
section_title: Enforcement Pending Appeal
paragraphs: Under existing law, a prosecutor's options when enforcing a restitution order include the inmate financial responsibility program, liens against the defendant's property, and garnishment of the defendant's wages or amounts in his pension plan. A court, however, may stay execution of a restitution order pending appeal, and "may issue any order reasonably necessary to ensure compliance with a restitution order" including posting of a bond, deposit with the registry of the court, an injunction, or a restraining order under Rule 38(e) of the Federal Rules of Criminal Procedure. The law demands more rigorous protection when the payment of a fine is stayed. There the court must order the posting of a bond or a deposit with the registry of the court or impose a restraining order, except in exceptional circumstances.
S. 973 / H.R. 4110 would have dictated that any stay pending appeal that curtails a prosecutor's ability to enforce a restitution order in the interim must be for good cause stated on the record. It also seemed to narrow the court's discretion over the protective orders that may accompany a stay. Rule 38(e) affords the court the discretion to issue any protective order the court considers reasonably necessary. S. 973 / H.R. 4110 would have used the more demanding standard governing orders staying the payment of a fine pending appeal: mandatory protective measures except under exceptional circumstances. Although S. 973 / H.R. 4110 would have neither expressly repealed nor amended Rule 38(e), its amendment was rather clearly intended to supplant the Rule. In addition, S. 973 / H.R. 4110 would have stated that the issuance of such mandatory protective measures should not be construed as a limitation on the authority of prosecutors to continue their restitution-related investigations and enforcement efforts.
The Justice Department materials describe the change but do not explain it. To some extent the motivation is clear: secure restitution for victims as quickly as possible and prevent the loss of any assets that might be used to pay restitution. The materials do point out that in part the proposal for restitution pending appeal "parallels" the treatment of fines pending appeal under existing law.
But the two may raise different considerations. For instance, if a defendant is vindicated on appeal, the government can be compelled to return the amount the defendant paid in fines pending appeal. On the other hand, the government cannot be compelled to return amounts it recovered as restitution and passed on to victims, even if the defendant is subsequently vindicated on appeal.
There is another difference. The law permits a court to forego imposition of a fine when it might otherwise impose a hardship. Thus, a court may refrain from imposing a fine when a defendant has insufficient resources to satisfy both fine and restitution obligations. The Sentencing Guidelines state that the court need not impose a fine "where the defendant establishes that he is unable to pay and is not likely to become able to pay any fine" or "imposition of a fine would unduly burden the defendant's dependents." There are no such ameliorating provisions in the law of mandatory restitution. Therefore, the denial of stay pending appeal or an asset freeze pending appeal may impose greater hardships in the restitution cases than in fine cases.
The silence of the Justice Department materials may seem unfortunate in another respect. The materials do not further identify the type of "order described in subparagraph (B)"("an order limiting the enforcement of restitution obligations") that may not intrude upon a prosecutor's authority to conduct investigations of the defendant's finances, conduct discovery, record a lien, or seek any injunction. It obviously includes a stay pending appeal, but the wording is sufficiently vague to be construed as a limitation on the sentencing court's authority to curtail enforcement of its restitution order. The clause has no statutory counterpart in present law whether of restitution or fines.
section_title: Prosecutors' Access to Information
paragraphs: Under the Federal Rules of Criminal Procedure, the probation officer's sentencing report may not include certain medical, confidential or informant-related material. The Rules also forbid disclosing matters occurring before a federal grand jury, subject to certain exceptions, some which require court approval and some of which do not. Various other statutes prohibit the disclosure of financial information but recognize an exception for information provided under grand jury subpoena. Those statutes may be thought to proscribe disclosure beyond the grand jury absent some additional grant of authority. There are no statutory provisions which specifically proscribe Bureau of Prisons officials from disclosing to prosecutors information relating to an inmate's ability to pay restitution.
S. 973 / H.R. 4110 would have granted the United States Attorneys access without court approval to financial information on the defendant held by a grand jury, the Probation Office, or the Bureau of Prisons in order to enforce restitution orders. The Justice Department has explained that the change is necessary because some district courts insist upon court approval before allowing prosecutors to examine probation officer reports on a defendant's financial condition. They do not explain why explicit authority for access to grand jury material and Bureau of Prisons records is necessary or why court approval constitutes such a substantial obstacle.
section_title: Other Modifications
paragraphs: S. 973 / H.R. 4110 would have amended section 3664 in other ways. It would have made it clear that victims were to receive a copy of the restitution order, and would have required victims to notify the court of any change in address, although it afforded victims the option of notifying the Attorney General.
S. 973 / H.R. 4110 had several provisions designed to prevent the dissipation of assets following the issuance of the original restitution order. For instance, every restitution order would have had to include an instruction that the defendant was to refrain from any action that would conceal or dissipate his assets. The court in ordering restitution could have directed the defendant bring crime-related property back to within the jurisdiction of the court. At any time, it could have entered a protective order to ensure the availability of assets for restitution purposes. And it could have crafted or modified a restitution order to reflect the fact that the defendant had concealed or dissipated assets.
Present law requires a defendant to apply any windfall he receives while in prison to his restitution obligations. S. 973 / H.R. 4110 would have adopted the requirement, but expanded it to apply whenever restitution was outstanding regardless of whether the defendant was incarcerated at the time. S. 973 / H.R. 4110 would have provided a similar but more explicit and open ended list of factors for the court's consideration in assessing a defendant's ability to pay restitution than found in existing law.
section_title: Collection Act (H.R. 845 and S. 973/H.R. 4110)
paragraphs: S. 973 / H.R. 4110 and H.R. 845 would have amended the Federal Debt Collection Procedure Act, consistent with the Collection Act's availability as a means of enforcing restitution orders. The Collection Act is primarily a means of enforcing debts owed the United States arising in a civil or administrative context. S. 973 / H.R. 4110 and H.R. 845 would have amended three sections within the Debt Act to specifically refer to restitution or debts arising out of criminal cases. The amendment of section 3004 goes a bit further. That section now permits a debtor to have an enforcement proceeding transferred to the district in which he lives. The bills would have amended the provision in criminal cases to permit the court in which the debtor was sentenced to block the transfer.
section_title: Preconviction Asset Freeze (H.R. 845 and S. 973/H.R. 4110: Section 3664A)
paragraphs: H.R. 845 and S. 973 / H.R. 4110 would have added virtually identical asset preservation components to the restitution procedure in the form of a new 18 U.S.C. 3664A. The asset preservation features of section 3664A contemplated judicial asset freeze orders and other protective measures before conviction, both before and after indictment. The procedure drew upon, and in part was modeled after, the protective order features of the criminal forfeiture section of the Controlled Substances Act.
In some ways, the model may have seem a less than perfect fit. The title to forfeitable property vests in the United States when the confiscation-triggering offense is committed. Restitution has no comparable feature. At the time of the passage of the Controlled Substance Act, property used to facilitate the commission of a forfeiture-triggering offense could be confiscated in a civil proceeding upon a showing of probable cause. And so it seems no great step to say that the court may issue a property freeze order pending the outcome of a criminal trial, based on probable cause to believe that the property restrained constitutes the proceeds or instruments of a crime, when the court has authority to order the property confiscated civilly under the same probable cause standard. Restitution requires conviction of the property owner; civil forfeiture does not. Restitution has no civil forfeiture equivalent.
The Controlled Substances Act permits the issuance of the protective order before the property owner has been charged with any offense. So would have H.R. 845 and S. 973 / H.R. 4110 . Again in the case of the Controlled Substance Act, it may not seem like a great step to say the court can freeze property which it could order confiscated using the same or a less demanding standard of proof; but restitution has no civil forfeiture equivalent. Furthermore, even after indictment, the Controlled Substance Act ordinarily does not permit restraint of "innocent" assets, assets not associated with the commission of the offense. H.R. 845 and S. 973 / H.R. 4110 would have.
On the other hand, proponents might well have pointed out that some of the differences between forfeiture and restitution argue for greater protective tools in the case of restitution. The government is the beneficiary of confiscation; the victims of crime are the beneficiaries of restitution. A victim is likely to feel the loss of restitution more sharply than the government will feel the loss of forfeitable property.
As for the availability of a civil forfeiture equivalent, proponents might have noted that under existing law authorities may use a search warrant to seize the fruits of crime based on the probable cause. The protective orders envisioned in H.R. 845 and S. 973 / H.R. 4110 would have either involved property traceable to a particular offense or could only have been issued in the interest of justice. They would not have been administrative commands, but court-issued protective measures replete with the prospect of a judicial hearing to contest their issuance.
The task of assessing the relative strengths and weaknesses of proposed section 3664A would have been made more complicated by its occasional want of clarity. Notwithstanding the Justice Department's guidance, the text was sometimes perplexing. The bills would have authorize protective orders generally and although they did not say so in so many words they clearly anticipate that protective measures would have been available prior to conviction, both before and after indictment. They would have called for protective orders in the case of traceable property and in the interest of justice:
Upon the government's ex parte application and a finding of probable cause that a defendant, if convicted, will be ordered to pay an approximate amount of restitution for an offense punishable by imprisonment for more than one year, the court – (A) shall – (i) enter a restraining order or injunction; (ii) require the execution of a satisfactory performance bond; or (iii) taken any other action necessary to preserve the availability of any property traceable to the commission of the offense charged; and(B) if it determines that it is in the interests of justice to do so, shall issue any order necessary to preserve any nonexempt asset (as defined in section 3613) of the defendant that may be used to satisfy such restitution order. Proposed 18 U.S.C. 3664A(a)(1)( H.R. 845 ).
The Justice Department's Analysis of the proposal indicates that the Department believes: (1) that the paragraphs represent two distinct grants of authority, not one grant with two elements, each of which must be satisfied before the authority may be exercised; (2) that the difference between paragraph (A) and (B) is the difference between assets traceable to the crime charged (A) and those that are not (B); (3) that the measures described in (A)(i), (ii), and (iii) all apply to traceable property; (4) that the interest of justice standard applies to protective measures issued against property unrelated to the offense (B property), but not to the measures issued against traceable property (A property); and (5) that the court is obligated to issue the protective measures sought under (A) (traceable property) and, subject to an "interest of justice" determination, those under (B)(any property).
It does not explain the apparent duplication. Perhaps the most plausible explanation is that the two were to be available to the government at its option. There might be some logic to the argument that the traceable property clause (A) was meant to apply in pre-indictment cases and the all-property clause (B) in post-indictment cases. After all, read that way pre-indictment orders, those which might have been held to the more demanding standard, would have only reach the narrowest and least defensible of an individual's property – that traceable to a crime.
Yet the text failed to confirm such an interpretation when it referred to both pre- and post-indictment measures as those taken "under subsection (a)(1)" of which both (A) and (B) were a part. More compelling still was the text of the traceable property clause (A) which would have authorized protective measures for property "traceable to the commission of the offense charged ." The traceable property clause (A) could hardly apply exclusively to pre-indictment orders since prior to indictment there is no crime charged.
The hearing procedure intended in post-indictment cases seemed to present further ambiguities. It seemed fairly certain that the bills meant to establish the following procedure. Courts would be authorized to issue an ex parte protective order upon a probable cause showing that (1) the defendant had been indicted for an offense for which restitution might be ordered, (2) that the offense or offenses had resulted in qualified losses to qualified victims of an approximate amount for which the defendant would be obligated to make restitution if convicted of the offense or offenses charged, (3) the value of the property to be restrained or the amount of the bond to be posted did not greatly exceed the approximate amount of restitution that might be awarded, and (4) (perhaps) the property is traceable to the offense charged.
A defendant would be entitled to a hearing upon a prima facie showing that the value of property restrained or the amount of the bond greatly exceeded the amount of the restitution that could be ordered; or that the law does not authorize restitution for the offense, victim, or losses claimed in the order; or (if the court relies on the traceable property prong of proposed section 3664A(a)(1)(A)) that the property restrained is not traceable to the offense charged. Even then, a hearing could be granted only if the defendant could also show by a preponderance of the evidence that the order had or would deprive him of defense counsel of his choice or deprive the defendant or his family of the necessities of life. If the defendant is able to meet this burden – or whatever reduced burden due process demands – he is entitled to a hearing at which the government may contest his challenge. After which, the court may modify its protective order should it find either (1) a want of probable cause to believe that the restrained property or at least all of it would be needed to satisfy any restitution order under the facts of the case; or (2) (if the "traceable property" authority was relied upon) a want of probable cause to believe that the restrained property or some of it is traceable to the offense charged, or (perhaps or at least to the extent due process requires); (3) that a failure to modify the order would deny the defendant defense counsel of his choice or would impose an undue hardship upon the defendant or his family.
The above description seems be what S. 973 / H.R. 4110 and H.R. 845 had in mind; it was not literally what they stated. First, S. 973 / H.R. 4110 stated that the court could issue a protective order upon "a finding of probable cause to believe that a defendant, if convicted, will be ordered to satisfy an order of restitution . . .." It said nothing about the size of the anticipated restitution order nor about the relationship between the value of the restitution that might be owed to the value of the property to be restrained. H.R. 845 suggested this may have been an oversight, for the only change it would have made in S. 973 / H.R. 4110 's treatment was to state that a court could issue a protective order upon "a finding of probable cause to believe that a defendant, if convicted, will be ordered to pay an approximate amount of restitution . . .." H.R. 845 said nothing about a necessary relationship between this "approximate amount" and the value of the property restrained, but otherwise there seemed little reason to make the change. Both bills noted that once their probable cause standards had been met a protective order covering traceable property could have been issued; neither bill indicated what level of certainty would have been required for a finding that a particular piece of property was traceable to an offense charged.
Second, both bills stated that the defendant would be entitled to a hearing in which to seek a modification of the ex parte order only if he showed by a preponderance of the evidence that he had or would suffer hardship or lost defense counsel and if he made "a prima facie showing that there is a bona fide reason to believe that the court's ex parte finding of probable cause under subsection (a)(1) was in error." The text of S. 973 / H.R. 4110 on its face would have limited the probable cause threshold to a showing that the court erroneously concluded that if convicted the defendant could be ordered to pay restitution. The defendant could have literally overcome this obstacle only if he could show that restitution could not have been lawfully ordered because the offense was not one for which restitution could be ordered or because the case lacked either victims eligible for restitution or losses for which restitution could be awarded. If this were all that was intended there would be no reason to add the additional hardship threshold that S. 973 / H.R. 4110 would have imposed.
The same was true of H.R. 845 . Moreover, in the case of H.R. 845 the defendant would have had to show that the court erroneously concluded that probable cause existed to believe that "the defendant, if convicted, will be ordered to pay an approximate amount of restitution." There was no reason to insist on showing of an approximate amount of the possible restitution unless that determination somehow related to the value of the property restrained, if only very roughly.
Exactly how much more was intended or must be intended was complicated by the unresolved question of what due process requires. In the forfeiture context and as a matter of statutory construction, the Supreme Court has indicated that the courts have no choice but to issue a protective order upon receipt of an ex parte government application following indictment even where the defendant seeks to use the assets to pay for legal representation. The Court expressly left open the constitutional issue of when and what sort of hearing may be required as a matter of due process. The issue divides the lower federal appellate courts. Some hold that a post-indictment ex parte restraining order is only good for ten days with the possibility of only one ten day extension before a probable cause hearing must be held. Others find that "although pre-trial restraint of assets needed to retain counsel implicates the due process clause, the trial itself satisfies this requirement." The majority are somewhere in between, but are particularly swayed when it appears that the order may reach funds needed to pay defense counsel.
Third, once a hearing has been granted, the bills stated that an order could be modified if "more property has been seized and restrained that may be needed to satisfy a restitution order . . .." They also would have permitted modification if the court "finds under subparagraph (A) that no probable cause exists as to some or all of the property." A subparagraph (A) hearing was to be conducted to "determine whether there is probable cause to believe that the defendant, if convicted, will be ordered to satisfy an order of restitution . . . and that the seized or restrained property may be needed to satisfy such restitution order ." The italicized language suggested that some comparative analysis of the relative value of the assets frozen and restitution to be owed was necessary from the beginning when the court entered its ex parte order. Moreover, although neither bill made any mention of it, either the text or due process would have been construed to bar restraint of innocent assets (those not traceable to the offense charged) if needed to provide the necessities of life and perhaps if needed to retain counsel.
As for pre-indictment protective orders, the bills would have declared that applications and orders are to be governed by 21 U.S.C. 853(e) and proposed section 3664A. This should probably have been understood to say that proposed section 3664A governs in cases of conflict with section 853(e). Prior to indictment, section 853(e) requires that the property owner be given notice and an opportunity for a hearing, unless the government establishes by probable cause that the property will become unavailable if prior notice is given. The bills would seem to have made the initial issuance of the restraining order ex parte in all cases. Such ex parte restraining orders would have been temporary, good for only ten days unless extended for cause. Absent an indictment, the restraining order would only have been good for ninety days, unless extended for cause. Section 3664A would not have described the post-restraint hearing to be held in pre-indictment cases. Section 853(e)(1)(B) indicates that upon application of the United States, the court may enter protective orders to preserve the availability of property which the government asserts is subject to criminal forfeiture prior to indictment if it finds
that – (i) there is a substantial probability that the United States 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; and (ii) 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.
Substituting the word "restitution" for "forfeiture," this is the likely description of the hearing the bills envisioned.
Most courts have held that protective orders freezing innocent assets under 21 U.S.C. 853(e) may not be issued prior to conviction. Whether the bills intended to adopt this case law as part of their adoption of section 853(e) was not clear.
Under the bills, an indicted defendant could not have plead his innocence as the basis for lifting the restraining order. Third parties could have moved for a modification of a restraining order on the grounds of hardship and less onerous alternatives. At least on the face of things, third parties could not have moved to have a restraining order modified on the grounds that the property restrained belonged to them rather than to the defendant, although they could have done so at the conclusion of the criminal case.
section_title: Anti-Crime Injunction Expansion (H.R. 845 and S. 973/H.R. 4110)
paragraphs: Traditionally, the federal courts will not enjoin the commission of a crime unless expressly authorized to do so by statute. As part of the Comprehensive Crime Control Act of 1984, Congress enacted 18 U.S.C. 1345 which authorized the federal courts to enjoin the commission of mail, bank, or wire fraud. Over the years, it expanded the authorization to encompass false claims against the United States, conspiracies to defrauding the United States, false statements in a matter within the jurisdiction of a federal agency or department, securities fraud, banking law offenses, and health care crimes. In 1990, it also authorize federal courts to freeze property derived from some of these offenses, namely, banking law or health care offenses.
H.R. 845 and S. 973 / H.R. 4110 would have enlarged section 1345 to authorize both injunctions and freeze orders relating to any federal offenses for which restitution might be ordered. Their reach would have been somewhat different since their view of offenses for which restitution could be ordered was different. For H.R. 845 , it would have been any federal offense which proximately caused another's pecuniary loss. For S. 973 / H.R. 4110 , it would have been the mandatory restitution crimes, that is, any federal crime of violence, crimes of fraud or property damage proscribed in Title 18, and product tampering, as well as the discretionary restitution crimes, that is, any other crime proscribed in Title 18, various aircraft safety and drug offenses, and the environmental crimes that S. 973 / H.R. 4110 would have added to the restitution list.
The Justice Department materials do not identify any particular reason why expansion would be necessary or useful. The failure to expand the authority to enjoin a wider range of criminal violations would not appear to have any obvious restitution consequences. Expanding the authority to issue restraining orders does have restitution consequences, but it is not clear what amending section 1345 would have provided that is not or should not be addressed in the context of proposed section 3664A .
section_title: Fine Collection (S. 973/H.R. 4110)
paragraphs: S. 973 / H.R. 4110 would have amended the fine collection language in section 3572(d) so that it would have run parallel to the bill's amendments relating to restitution collection. H.R. 845 had no comparable provision. Present law directs that fines be paid immediately, unless in the interests of justice, the court authorizes an installment payment schedule. Installment payments are to be scheduled to permit full payment as quickly as possible. The defendant is obligated to inform the court of any change in his financial circumstances and the court may modify the order for payment accordingly.
Following the pattern it used for restitution, S. 973 / H.R. 4110 would have eliminated the language that might suggest that the court has exclusive and predominant payment scheduling authority. In its place would have appeared language that instructed the courts to order that "any fine or assessment imposed be due immediately;" couched their installment payment scheduling authority in permissive ("may") rather than mandatory ("shall") terms; and added references to the special enforcement authority of the government. As with restitution, S. 973 / H.R. 4110 would have instructed the court to direct defendants to:
•    pay their fines and assessments as quickly as is reasonably possible;
•    avoid concealment or dissipation of assets or income;
•    notify the court of any change of address; and
•    notify the prosecutor of any change of address or financial circumstances.
For purposes of fine and special assessment collection, by virtue of S. 973 / H.R. 4110 prosecutors would have enjoyed access, without the necessity of court approval, to financial information relating to the defendant and held by the grand jury, Probation Office, or Bureau of Prisons.
S. 973 / H.R. 4110 would have added that the court could impose nominal payment schedules set at no less than $100 per year where the defendant's financial circumstances precluded a more substantial payment schedule. The court could also have adjusted these or any other payment schedules "at any time prior to the termination of a restitution obligation under section 3613," which presumably meant during the 20 year period following the defendant's release from prison or following sentencing if the defendant were not imprisoned. The court could have issued a restraining order or taken other protection measures to prevent the scattering of assets that might be used to pay the defendant's fine. It could also have ordered the defendant to return scattered crime-generated assets and perhaps to turn over non-exempt assets.
Finally, S. 973 / H.R. 4110 would have described the government's authority to enforce fines pending appeal in the same terms it used for restitution. A court would have enjoyed the authority to stay the government's enforcement efforts only upon a show of good cause. If it issued a stay, it would have been required to issue an accompanying protective order absent exceptional circumstances. Any such protective order, however, could not have restricted the government's prerogatives to investigate the defendant's financial circumstances, conduct discovery, file a lien, or invoke the equitable powers of the court.