Forfeiture of narcotics-generated wealthin the United States of America pursuant to the Comprehensive Forfeiture Act of 1984

Sections

ABSTRACT
Introduction
Comprehensive Forfeiture Act of 1984 9
Part A: amendments to the RICO statute
Part B: amendments to the Comprehensive Drug Abuse Prevention and Control Act of 1970
Part C: further amendments to the Comprehensive Drug Abuse Prevention and Control Act of 1970
Part D: amendments to the Tariff Act of 1930
Conclusion
Annex EXCERPTS FROM THE COMPREHENSIVE CRIME CONTROL ACT OF 1984 CHAPTER III - FORFEITURE
PART C
PART D

Details

Author: P. C. GUNN
Pages: 61 to 89
Creation Date: 1984/01/01

Forfeiture of narcotics-generated wealthin the United States of America pursuant to the Comprehensive Forfeiture Act of 1984

P. C. GUNN Senior Trial Attorney, Office of International Affairs, Criminal Division, United States Department of Justice, Washington, D.C, United States of America .

ABSTRACT

Trafficking in illegal narcotics and dangerous drugs exists mainly because it yields immense profits and it can be eradicated only by depriving traffickers of their drug derived profits and economic power. With that in mind and to cope more effectively with the problem, the United States Congress recently enacted the Comprehensive Forfeiture Act of 1984, which revised and strengthened the existing laws and procedures. This Act is comprised of four parts. Part A amends the forfeiture proceedings of the Racketeer influenced and CorruptOrganization (RICO) statute. Part B adds a new criminal forfeiture statute to the Comprehensive Drug Abuse Prevention and Control Act of 1970, which permits forfeiture in all drug felony cases. This newly created section of the Act also adopts other measures, a number of which are identical to those contained in part A of the RICO amendments. In addition, part B contains a civil forfeiture provision to reach land and buildings used to facilitate felonious drug offences. Part C, inter alia, establishes a revolving fund for the use of the Department of Justice in enforcing forfeiture laws and amends existing provisions regarding the disposition of forfeited property.Part D sets up a Customs Forfeiture Fund.

Introduction

One of the gravest threats facing the world today is the organized and systematic distribution of illegal drugs at the local, national and international levels. This world-wide problem poses a threat to the addict, who cripples his or her body and mind by ingesting such poisonous substances; to the addict's family, which must bear the brunt of the self-destructive behaviour; to the local community, which is brutalized by the burglaries, robberies and murders that inevitably accompany drug dealing and addiction; and to the world community, which must cope with the above mentioned problems while struggling to counter the corruption, political destabilization, and economic dislocation that result from world-wide drug trafficking.

There has for the last 15 years been a marked change in the response of the authorities of the United States of America to the increasingly sophisticated techniques used by organized crime and illegal drug cartels on the national and international levels. lt has become apparent to the Congress and to the law enforcement officials that merely prosecuting and incarcerating participants of criminal organizations and enterprises are not sufficient measures to combat them. To stop drug trafficking and its associated problems, drug traffickers must be deprived of the proceeds of their illegal activities. ln 1970 Congress began taking an economic approach to fighting organized crime in general and drug trafficking in particular. Considering proposed legislation to deal with organized crime and its takeover of or investment in legitimate businesses with the proceeds of crimes, a subcommittee of the Senate concluded :

"What is needed here . . . are new approaches that will deal not only with individuals, but also with the economic base through which these individuals constitute such a serious threat to the well-being of the nation. In short, an attack must be made on their source of economic power itself, and the attack must take place on all available fronts." [ [ l] ]

This view prevailed in both the United States Senate and House of Representatives in 1970. The Ninety-first Congress passed several pieces of legislation that were intended to curtail the economic power of organized crime and drug traffickers. lt enacted the Racketeer Influenced and Corrupt Organization statute (RICO), 18 United States Code (USC) section 1961 et seq. [ 2] and the Continuing Criminal Enterprise statute (CCE), 21 USC section 848 [ 3] . RICO and CCE were the first criminal forfeiture statutes [ 4] in the history of the United States [ 5] and have been invaluable in combating drug trafficking. The Ninety-l-trst Congress also enacted a civil forfeiture provision, 21 USC section 881 [ 6] , pursuant to which most drug-related forfeitures have to date taken place [ 7] .

The United States Congress realized that the detection and investigation of criminal activity would often require that federal prosecutors and investigators be able to identify the source and movement of currency within the country, as well as currency that is transported into or out of the country. To address these needs, Congress enacted the Bank Records and Foreign Transaction Act of 1970, titles l and II of which are often referred to as the Bank Secrecy Act (BSA) [ 8] .

Comprehensive Forfeiture Act of 1984 [ 9]

Recognizing that even more stringent measures than those contained in RICO, CCE and BSA were needed, Congress enacted the Comprehensive Forfeiture Act of 1984 (hereinafter referred to as CFA) which revises and strengthens certain measures in the existing drug control laws and creates new measures designed to take the profit out of drug trafficking. This article highlights those provisions of CFA that may be of interest to legislators, prosecutors, and law enforcement officials who are concerned with eliminating drug trafficking. Extracts from the Comprehensive Crime Control Act of 1984, which comprises CFA, are presented in the annex to this article.

Part A: amendments to the RICO statute

The scope of property subject to criminal forfeiture under RICO has been expanded by CFA to include the proceeds derived from racketeering or unlawful debt collection. 1Because money derived from drug trafficking is often laundered outside the United States before being funneled back to purchase or invest in business ventures inside the country, this amendment is invaluable in forfeiting the proceeds of such circuitous ventures [18 USC 1963 (a) (3)]. Among the types of property subject to forfeiture are real property, tangible personal property, and intangible personal property [18 USC 1963 (b)]. RICO is also amended to provide that "in lieu of a fine otherwise authorized by [Section 1963 (a)], a defendant who derives profits or other proceeds from an offense may be fined not more than twice the gross profits or other proceeds''. This alternative to impose a fine that may be twice as large as the proceeds will penalize drug traffickers beyond the amounts they actually realize from their illicit activities and may, therefore, serve as a disincentive to those who might contemplate engaging in such activities.

The Government's title to property criminally forfeited pursuant to RICO will now be deemed to have vested at the time of the property's illegal use or acquisition [18 USC 1963 (c)]. Prior to this amendment, law enforcement authorities often found themselves in the position of having investigated, indicted, prosecuted and convicted major drug dealers, only to discover after obtaining forfeiture decrees that the properties ordered to be forfeited had been transferred to third parties, sometimes even prior to the filing of the indictments. Because the Government's title in such property is now defined to vest "upon the commission of the act giving rise to the forfeiture", any such third party assignments may be defeated unless the third party can establish in an ancillary, post-forfeiture hearing [18 USC 1963 (m)] that he is a bona fide purchaser for value who was unaware when he purchased the property that it was subject to forfeiture.

1 The statutory authorization merely codifies the holding in Russello v. United States.464 U.S. 104, s. Ct. 296(1983), permitting the forfeiture of any property constituting, or derived from, the proceeds of racketeering activity or unlawful debt collection as prohibited by section 1962 of the RICO statute.

Should it become apparent to a federal prosecutor that a target of his drug-related RICO investigation is likely to transfer his or her assets to a third party or to remove them from the court,s jurisdiction, the prosecutor may seek a temporary restraining order to prevent it [18 USC 1963 (e)]. In the past the prosecutor would have been prevented from seeking such an order until after filing an indictment or information. Under specially prescribed circumstances, the prosecutor may even obtain, ex parte, a pre-indictment restraining order valid for 10 days. This authority will be enormously useful in preventing the concealment, removal, or disposal of the proceeds of drug trafficking that could easily occur in some instances were a drug trafficker given notice of an application for such an order and the opportunity to oppose it.

Upon the conviction of a defendant, following a RICO trial, a court must enter a forfeiture judgement and authorize the Attorney General to seize the forfeited property [ 10] . A court may enter a wide variety of orders to preserve the value of said property [18 USC 1963 (l)]. During the time from seizure to actual disposition of the forfeited property, any income accrued to or derived from the property may be used to offset the ordinary and necessary expenses of maintaining the property.

The Attorney General is authorized to "direct the disposition of the property by sale or any other commercially feasible means, making due provision for the rights of innocent persons" [18 USC 1963 (g)]. Property rights or interest which cannot be exercised by or transferred to the Government will expire; they may not revert to the defendant. Likewise, the defendant is prohibited from re-acquiring the forfeited property disposed of at the Attorney General's direction.

Concerned with the rights of innocent third parties who might be adversely affected by a RICO forfeiture, Congress authorized the Attorney General to :

"(l) grant petitions for mitigation or remission of forfeiture, restore forfeited property to victims of a violation of RICO, or take any other action to protect the rights of innocent persons which is in the interest of justice;

"(2) compromise claims;

"(3) award compensation to persons providing information which results in forfeiture . . ." [18 USC 1963 (h)].

The remaining amendments to RICO [18 USC 1963 (i) to 1963 (m)] are addressed primarily to procedural, administrative, and jurisdictional matters that follow a forfeiture judgement.

Part B: amendments to the Comprehensive Drug Abuse Prevention and Control Act of 1970

Many of the RICO amendments described in the preceding section have provisions identical to those set forth in part B of CFA, which adds an entirely new section to the Comprehensive Drug Abuse Prevention and Control Act of 1970. This new section will be designated as 21 USC 853 (a) to 853 (p). Where the provisions of this new section are identical to those set forth in the RICO amendments, it will be noted so that the reader may refer to this section for an analysis of the provision.

Until the enactment of CFA, the continuing criminal enterprise statute [ [ l l] ] was the only criminal forfeiture provision available under the Comprehensive Drug Abuse Prevention and Control Act of 1970. CFA amends that Act by adding a new criminal forfeiture provision [21 USC 853 (a)] which requires a court to forfeit to the Government the following property of any person convicted of any drug felony under the Act:

"(l) any property constituting, or derived from any proceeds the person obtained. directly or indirectly, as the result of such violation;

"(2) any of the person's property used, or intended to be used, in any manner or part, to commit, or to facilitate the commission of such violation; and

"(3) in the case of a person convicted of engaging in a continuing criminal enterprise violation (21 USC 848), the person shall forfeit, in addition to any property described in (l) or (2), any of his interest in. claims against, and property or contractual rights affording a source of control over, the continuing criminal enterprise.''

Because the new criminal forfeiture statute set forth at 21 USC 853 (a) (3) carries forward the forfeiture provisions formerly found in the CCE statute, those provisions are now deleted from CCE as it was enacted in 1970. Criminal forfeitures under CCE will now be governed by all three subsections of 21 USC 853 (a) set forth above.

Like 18 USC 1963 (b) of the RICO amendments described in the preceding section, 21 USC 853 (b) makes it clear that real property, tangible personal property, and intangible personal property are subject to criminal forfeiture.

21 USC 853 (c) permits courts to void certain transfers of forfeitable property to third parties by defendants who contemplate indictment or conviction under this section. It is identical to 18 USC 1963 (c) of the RICO statute as recently amended.

Federal prosecutors will be aided in their efforts to forfeit proceeds of drug trafficking by 21 USC 853 (e) which creates a rebuttable presumption that any property acquired by a person convicted of a drug felony is subject to forfeiture if the Government establishes by a preponderance of the evidence that:

  1. Such property was acquired by such person during the period of the violation or within a reasonable time thereafter; and

  2. There was no likely source for such property other than the violation.

To insure the availability of forfeitable property until the conclusion of trials under this section, federal prosecutors may seek a variety of protective orders under 21 USC 853 (f), which is identical to 18 USC 1963 (e) of the RICO statute. However, if such a protective order would be insufficient, a prosecutor, upon a showing of probable cause, could obtain from a court a warrant authorizing seizure of the forfeitable property [21 USC 853 (g)].

Following the issuance of a forfeiture order under this section, the Attorney General is authorized by 21 USC 853 (h) to seize the forfeited property and to provide for its maintenance in the same manner prescribed by RICO amendment 18 USC 1963 (f). As with 18 USC 1963 (g), the Attorney General is authorized by 21 USC 853 (i) to dispose of such forfeited property by sale or any other commercially feasible means, taking due care for the rights of innocent third parties. In this vein, the Attorney General is authorized by 21 USC 853 (j) to take the same steps outlined in RICO amendment 18 USC 1963 (h).

The remaining portions of this new section, 21 USC 853 (k) through 853 (p), are addressed primarily to procedural, administrative and jurisdictional matters that follow a forfeiture judgement.

Part B of the Comprehensive Forfeiture Act of 1984 also amends the Comprehensive Drug Abuse Prevention and Control Act's civil forfeiture statute, 21 USC 881. The following types of property were already forfeitable pursuant to 21 USC 881 (a):

"(l) All controlled substances which have been manufactured, distributed, dispensed, or acquired in violation of this subchapter.

"(2) All raw materials, products, and equipment of any kind which are used, or intended for use, in manufacturing, compounding, processing, delivering, importing, or exporting any controlled substance in violation of this subchapter.

"(3) All property which is used, or intended for use, as a container for property described in paragraph (l) or (2).

"(4) All conveyances, including aircraft, vehicles, or vessels, which are used, or are intended for use, to transport, or in any manner to facilitate the transportation, sale, receipt, possession, or concealment of property described in paragraph (l) or (2), except that

"(A) no conveyance used by any person as a common carrier in the transaction of business as a common carrier shall be forfeited under the provisions of this section unless it shall appear that the owner or other person in charge of such conveyance was a consenting party or privy to a violation of this subchapter or subchapter II of this chapter; and

"(B) no conveyance shall be forfeited under the provisions of this section by reason of any act or omission established by the owner thereof to have been committed or omitted by any person other than such owner while such conveyance was unlawfully in the possession of a person other than the owner in violation of the criminal laws of the United States, or of any State.

"(5) All books, records, and research, including formulas, microfilm, tapes, and data which are used, or intended for use, in violation of this subchapter.

"(6) All moneys, negotiable instruments, securities, or other things of value furnished or intended to be furnished by any person in exchange for a controlled substance in violation of this subchapter, all proceeds traceable to such an exchange, and all moneys, negotiable instruments, and securities used or intended to be used to facilitate any violation of this subchapter, except that no property shall be forfeited under this paragraph, to the extent of the interest ofan owner, by reason of any act or omission established by that owner to have been committed or omitted without the knowledge or consent of that owner.'' 2

CFA contains a new provision, subsection 881 .(a) (7), which makes forfeitable real property used by a person who violates the Act.

Prior to enactment of 21 USC 881 (a) (7), federal prosecutors and law enforcement officials often found themselves in the frustrating position of being able to obtain forfeiture of the above-mentioned items, but not, for example, houses used by drug traffickers as headquarters for their drug businesses or buildings used as the laboratories for manufacturing and processing dangerous drugs or narcotics.

Part C: further amendments to the Comprehensive Drug Abuse Prevention and Control Act of 1970

This Act is further amended by the addition of 21 USC 881 (j) which creates, on a four-year experimental basis, a Department of Justice Asset Forfeiture Fund.All of the money generated from profitable civil or criminal forfeitures pursuant to laws enforced or administered by the United States Department of Justice are to be deposited into this fund. The Attorney General may use moneys from the fund for, among other things, to:

2Subsection 881(a)was amended in 1978 by adding 881(a)(6).Psychotropic Substances Act of 1978, Public Law No.95-633.

  1. Defray the expenses resulting from forfeiture actions;

  2. Pay awards to persons who provide information resulting in a civil or criminal forfeiture under the Comprehensive Drug Abuse Prevention and Control Act of 1970 or a criminal forfeiture pursuant to RICO;

  3. Compromise and pay valid liens on and mortgages against forfeited property;

  4. Reimburse innocent third parties in connection with remission and mitigation procedures.

While 21 USC 881 (j) will be extremely useful to the federal law enforcement community, 21 USC 881 (e) (l) may prove to be equally beneficial to state and local law enforcement communities. This provision authorizes the Attorney General to share forfeited property with cooperating state and local law enforcement agencies.

Part D: amendments to the Tariff Act of 1930

Because a good number of forfeitures are made as a result of actions taken by customs officers, who are often the first line of defence in preventing the import and export of drugs and drug money, the CFA of 1984 creates a Customs Forfeiture Fund [19 USC 1613 (a)]. The money resulting from the sale of property forfeited pursuant to the laws enforced or administered by the United States Customs Service will be deposited into this fund. The fund may be used to :

  1. Defray the expenses incurred in connection with seizure, detention, forfeiture or sale of property; and

  2. Pay awards to informers whose information results in a customs forfeiture.

The maximum amount an informer may be paid is $US 150,00(); providing, however, that an award may not exceed one fourth of the net amount recovered by the Government from the forfeiture [19 USC 1619].

The remaining amendments to the Tariff Act of 1930 are largely concerned with procedural, administrative and jurisdictional matters relating to the enforcement and administration of the customs laws.

Conclusion

CFA significantly increases the ability of federal law enforcement officials to fight drug trafficking. An examination of the measures that have been adopted by the United States Congress during the last 15 years clearly indicates that increasingly sophisticated legislation and greater resources have been required in order to prevent the scales of justice from being irreversibly tipped in favour of national and international drug traffickers. Even with this new legislation, however, victory in the drug battle within the United States, which is merely part of a much larger war being waged against the world community by drug dealers, is not assured of success. It may be lost here and in country after country unless measures are taken now, on an international basis and within the borders of every nation, to eliminate this threat to humanity.

Annex EXCERPTS FROM THE COMPREHENSIVE CRIME CONTROL ACT OF 1984 CHAPTER III - FORFEITURE

SEC. 301. This title may be cited as the "Comprehensive Forfeiture Act of 1984''.

PART A

SEC. 302. Section 1963 of title 18 of the United States Code is amended to read as follows: .

"§ 1963. Criminal penalties

"(a) Whoever violates any provision of section 1962 of this chapter shall be fined not more than $ 25,000 or imprisoned not more than twenty years, or both, and shall forfeit to the United States, irrespective of any provision of State law

"(l) any interest the person has acquired or maintained in violation of section 1962;

"(2) any

"(A) interest in;

"(B) security of;

"(C) claim against; or .

"(D) property or contractual right of any kind affording a source of influence over; any enterprise which the person has established, operated, controlled, conducted, or participated in the conduct of, in violation of section

1962; and

"(3) any property constituting, or derived from, any proceeds which the person obtained, directly or indirectly, from racketeering activity or unlawful debt collection in violation of section 1962.

The court, in imposing sentence on such person shall order, in addition to any other sentence imposed pursuant to this section, that the person forfeit to the United States all property described in this subsection.

"(b) Property subject to criminal forfeiture under this section includes

"(l) real property, including things growing on, affixed to, and found in land; and

"(2) tangible and intangible personal property, including rights, privileges, interests, claims, and securities.

"(c) All right, title, and interest in property described in subsection (a) vests in the United States upon the commission of the act giving rise to forfeiture under this section. Any such property that is subsequently transferred to a person other than the defendant may be the subject of a special verdict of forfeiture and thereafter shall be ordered forfeited to the United States, unless the transferee establishes in a hearing pursuant to subsection (m) that he is a bona fide purchaser for value of such property who at the time of purchase was reasonably without cause to believe that the property was subject to forfeiture under this section."

"(e) (l) Upon application of the United States, the court may enter a restraining order or injunction, require the execution of a satisfactory performance bond, or take any other action to preserve the availability of property described in subsection (a) for forfeiture under this section

"(A) upon the filing of an indictment or information charging a violation of section 1962 of this chapter and alleging that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture under this section ; or

"(B) prior to the filing of such an indictment or information, if, after notice to persons appearing to have an interest in the property and opportunity of a hearing, the court determines 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 : Provided,however,That an order entered pursuant to subparagraph (B) shall be effective for not more than ninety days, unless extended by the court for good cause shown or unless an indictment or information described in subparagraph (A) has been filed.

"(2) A temporary restraining order under this subsection may be entered upon application of the United States without notice or opportunity for a hearing when an information or indictment has not yet been filed with respect to the property, if the United States demonstrates that there is probable cause to believe that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture under this section and that provision of notice will jeopardize the availability of the property for forfeiture. Such a temporary order shall expire not more than ten days after the date on which it is entered, unless extended for good cause shown or unless the party against whom it is entered consents to an extension for a longer period. A hearing requested concerning an order entered under this paragraph shall be held at the earliest possible time, and prior to the expiration of the temporary order.

"(3) The court may receive and consider, at a hearing held pursuant to this subsection, evidence and information that would be inadmissible under the Federal Rules of Evidence.

"(f) Upon conviction of a person under this section, the court shall enter a judgment of forfeiture of the property to the United States and shall also authorize the Attorney General to seize all property ordered forfeited upon such terms and conditions as the court shall deem proper. Following the entry of an order declaring the property forfeited, the court may, upon application of the United States, enter such appropriate restraining orders or injunctions, require the execution of satisfactory performance bonds, appoint receivers, conservators, appraisers, accountants, or trustees, or take any other action to protect the interest of the United States in the property ordered forfeited. Any income accruing to, or derived from, an enterprise or an interest in an enterprise which has been ordered forfeited under this section may be used to offset ordinary and necessary expenses to the enterprise which are required by law, or which are necessary to protect the interests of the United States or third parties.

"(g) Following the seizure of property ordered forfeited under this section, the Attorney General shall direct the disposition of the property by sale or any other commercially feasible means, making due provision for the rights of any innocent persons. Any property right or interest not exercisable by, or transferable for value to, the United States shall expire and shall not revert to the defendant, nor shall the defendant or any person acting in concert with or on behalf of the defendant be eligible to purchase forfeited property at any sale held by the United States. Upon application of a person, other than the defendant or a person acting in concert with or on behalf of the defendant, the court may restrain or stay the sale or disposition of the property pending the conclusion of any appeal of the criminal case giving rise to the forfeiture, if the applicant demonstrates that proceeding with the sale or disposition of the property will result in irreparable injury, harm or loss to him. Notwithstanding 31 U.S.C. 3302 (b), the proceeds of any sale or other disposition of property forfeited under this section and any moneys forfeited shall be used to pay all proper expenses for the forfeiture and the sale, including expenses of seizure, maintenance and custody of the property pending its disposition, advertising and court costs. The Attorney General shall deposit in the Treasury any amounts of such proceeds or moneys remaining after the payment of such expenses.

"(h) With respect to property ordered forfeited under this section, the Attorney General is authorized to

"(l) grant petitions for mitigation or remission of forfeiture, restore forfeited property to victims of a violation of this chapter, or take any other action to protect the rights of innocent persons which is in the interest of justice and which is not inconsistent with the provisions of this chapter;

"(2) compromise claims arising under this section;

"(3) award compensation to persons providing information resulting in a forfeiture under this section ;

"(4) direct the disposition by the United States of all property ordered forfeited under this section by public sale or any other commercially feasible means, making due provision for the rights of innocent persons; and

"(5) take appropriate measures necessary to safeguard and maintain property ordered forfeited under this section pending its disposition.

"(i) The Attorney General may promulgate regulations with respect to

"(l) making reasonable efforts to provide notice to persons who may have an interest in property ordered forfeited under this section;

"(2) granting petitions for remission or mitigation of forfeiture;

"(3) the restitution of property to victims ofan offense petitioning for remission or mitigation of forfeiture under this chapter;

"(4) the disposition by the United States of forfeited property by public sale or other commercially feasible means;

"(5) the maintenance and safekeeping of any property forfeited under this section pending its disposition ; and

"(6) the compromise of claims arising under this chapter. Pending the promulgation of such regulations, all provisions of law relating to the disposition of property, or the proceeds from the sale thereof, or the remission or mitigation of forfeitures for violation of the customs laws, and the compromise of claims and the award of compensation to informers in respect of such forfeitures shall apply to forfeitures incurred, or alleged to have been incurred, under the provision of this section, insofar as applicable and not inconsistent with the provision hereof. Such duties as are imposed upon the Customs Service or any person with respect to the disposition of property under the customs law shall be performed under this chapter by the Attorney General.

"(j) Except as provided in subsection (m), no party claiming an interest in property subject to forfeiture under this section may

"(l) intervene in a trial or appeal of a criminal case involving the forfeiture of such property under this section; or

"(2) commence an action at law or equity against the United States concerning the validity of his alleged interest in the property subsequent to the filing ofan indictment or information alleging that the property is subject to forfeiture under this section.

"(k) The district courts of the United States shall have jurisdiction to enter orders as provided in this section without regard to the location of any property which may be subject to forfeiture under this section or which has been ordered forfeited under this section.

"(l) In order to facilitate the identification or location of property declared forfeited and to facilitate the disposition of petitions for remission or mitigation of forfeiture, after the entry.of an order declaring property forfeited to the United States the court may, upon application of the United States, order that the testimony of any witness relating to the property forfeited be taken by deposition and that any designated book, paper, document, record, recording or other material not privileged be produced at the same time and place, in the same manner as provided for the taking of depositions under Rule 15 of the Federal Rules of Criminal Procedure.

"(m) (l) Following the entry ofan order of forfeiture under this section, the United States shall publish notice of the order and of its intent to dispose of the property for at least seven successive court days in such manner as the Attorney General may direct. The Government may also, to the extent practicable, provide direct written notice to any person known to have alleged an interest in the property that is the subject of the order of forfeiture as a substitute for published notice as to those persons so notified.

"(2) Any person, other than the defendant, asserting a legal interest in property which has been ordered forfeited to the United States pursuant to this section may, within thirty days of the final publication of notice or his receipt of notice under paragraph (l), whichever is earlier, petition the court for a hearing to adjudicate the validity of his alleged interest in the property. The hearing shall be held before the court alone, without a jury.

"(3) The petition shall be signed by the petitioner under penalty of perjury and shall set forth the nature and extent of the petitioner's right, title, or interest in the property, the time and circumstances of the petitioner's acquisition of the right, title, or interest in the property, any additional facts supporting the petitioner's claim, and the relief sought.

"(4) The hearing on the petition shall, to the extent practicable and consistent with the interests of justice, be held within thirty days of the filing of the petition. The court may consolidate the hearing on the petition with a hearing on any other petition filed by a person other than the defendant under this subsection.

"(5) At the hearing, the petitioner may testify and present evidence and witnesses on his own behalf, and cross-examine witnesses who appear at the hearing. The United States may present evidence and witnesses in rebuttal and in defense of its claim to the property and cross-examine witnesses who appear at the hearing. In addition to testimony and evidence presented at the hearing, the court shall consider the relevant portions of the record of the criminal case which resulted in the order of forfeiture.

"(6) If, after the hearing, the court determines that the petitioner has established by a preponderance of the evidence that

"(A) the petitioner has a legal right, title, or interest in the property, and such right, title, or interest renders the order of forfeiture invalid in whole or in part because the right, title, or interest was vested in the petitioner rather than the defendant or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which gave rise to the forfeiture of the property under this section; or

"(B) the petitioner is a bona fide purchaser for value of the right, title, or interest in the property and was at the time of purchase reasonably without cause to believe that the property was subject to forfeiture under this section; the court shall amend the order of forfeiture in accordance with its determination.

"(7) Following the court's disposition of all petitions filed under this subsection, or if no such petitions are filed following the expiration of the period provided in paragraph (2) for the filing of such petitions, the United States shall have clear title to property that is the subject of the order of forfeiture and may warrant good title to any subsequent purchaser or transferee.,,.

PART B

SEC. 303. Part D of title II of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U,S.C, 841 et seq.) is amended by adding at the end thereof the following new sections 413 and 414:

"CRIMINAL FORFEITURES PROPERTY SUBJECT TO CRIMINAL FORFEITURE

"SEC.413. (a) Any person convicted of a violation of this title or title III punishable by imprisonment for more than one year shall forfeit to the United States, irrespective of any provision of State law

"(l) any property constituting, or derived from, any proceeds the person obtained, directly or indirectly, as the result of such violation:

"(2) any of the person's property used, or intended to be used, in any manner or part, to commit, or to facilitate the commission of, such violation ; and

"(3) in the case of a person convicted of engaging in a continuing criminal enterprise in violation of section 408 of this title (21 U.S.C.

848), the person shall forfeit, in addition to any property described in paragraph (l) or (2), any of his interest in, claims against, and property or contractual rights affording a source of control over, the continuing criminal enterprise.

The court, in imposing sentence on such person, shall order, in addition to any other sentence imposed pursuant to this title or title III, that the person forfeit to the United States all property described in this subsection.

"MEANING OF TERM 'PROPERTY'

"(b) Property subject to criminal forfeiture under this section includes -

"(l) real property, including things growing on, affixed to, and found in land; and

"(2) tangible and intangible personal property, including rights, privileges, interests, claims, and securities.

"THIRD PARTY TRANSFERS

"(c) All right, title, and interest in property described in subsection (a) vests in the United States upon the commission of the act giving rise to forfeiture under this section. Any such property that is subsequently transferred to a person other than the defendant may be the subject of a special verdict of forfeiture and thereafter shall be ordered forfeited to the United States, unless the transferee establishes in a hearing pursuant to subsection (o) that he is a bona fide purchaser for value of such property who at the time of purchase was reasonably without cause to believe that the property was subject to forfeiture under this section.''

"REBUTTABLE PRESUMPTION

"(e) There is a rebuttable presumption at trial that any property of a person convicted of a felony under this title or title III is subject to forfeiture under this rid="sif">section if the United States establishes by a preponderance of the evidence that

"(l) such property was acquired by such person during the period of the violation of this title or title III or within a reasonable time after such period; and

"(2) there was no likely source for such property other than the violation of this title or title III.

"PROTECTIVE ORDERS

"(f) (l) Upon application of the United States, the court may enter a restraining order or injunction, require the execution of a satisfactory performance bond, or take any other action to preserve the availability of property described in subsection (a) for forfeiture under this section

"(A) upon the filing of an indictment or information charging a violation of this title or title lll for which criminal forfeiture may be ordered under this section and alleging that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture under this section; or

"(B) prior to the filing of such an indictment or information, if, after notice to persons appearing to have an interest in the property and opportunity for a hearing, the court determines 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 : Provided,however,Thatan order entered pursuant to subparagraph (B) shall be effective for not more than ninety days, unless extended by the court for good cause shown or unless an indictment or information described in subparagraph (A) has been filed.

"(2) A temporary restraining order under this subsection may be entered upon application of the United States without notice or opportunity for a hearing when an information or indictment has not yet been filed with respect to the property, if the United States demonstrates that there is probable cause to believe that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture under this section and that provision of notice will jeopardize the availability of the property for forfeiture. Such a temporary order shall expire not more than ten days after the date on which it is entered, unless extended for good cause shown or unless the party against whom it is entered consents to an extension for a longer period. A hearing requested concerning an order entered under this paragraph shall be held at the earliest possible time and prior to the expiration of the temporary order.

"(3) The court may receive and consider, at a hearing held pursuant to this subsection, evidence and information that would be inadmissible under the Federal Rules of Evidence.

"WARRANT OF SEIZURE

"(g) The Government may request the issuance of a warrant authorizing the seizure of property subject to forfeiture under this section in the same manner as provided for a search warrant. If the court determines that there is probable cause to believe that the property to be seized would, in the event of conviction, be subject to forfeiture and that an order under subsection (f) may not be sufficient to assure the availability of the property for forfeiture, the court shall issue a warrant authorizing the seizure of such property.

"EXECUTION

"(h) Upon entry ofan order of forfeiture under this section, the court shall authorize the Attorney General to seize all property ordered forfeited upon such terms and conditions as the court shall deem proper. Following entry of an order declaring the property forfeited, the court may, upon application of the United States, enter such appropriate restraining orders or injunctions, require the execution of satisfactory performance bonds, appoint receivers, conservators, appraisers, accountants, or trustees, or take any other action to protect the interest of the United States in the property ordered forfeit. Any income accruing to or derived from property ordered forfeited under this section may be used to offset ordinary and necessary expenses to the property which are required bylaw, or which are necessary to protect the interest of the United States or third parties.

"DISPOSITION OF PROPERTY

"(i) Following the seizure of property ordered forfeited under this section, the Attorney General shall direct the disposition of the property by sale or any other commercially feasible means, making due provision for the rights of any innocent persons. Any property right or interest not exercisable by, or transferable for value to, the United States shall expire and shall not revert to the defendant, nor shall the defendant or any person acting in concert with him or on his be half be eligible to purchase forfeited property at any sale held by the United States. Upon application of a person, other than the defendant or a person acting in concert with him or on his behalf, the court may restrain or stay the sale or disposition of the property pending the conclusion of any appeal of the criminal case giving rise to the forfeiture, if the applicant demonstrates that proceeding with the sale or disposition of the property will result in irreparable injury, harm, or loss to him.

"AUTHORITY OF THE ATTORNEY GENERAL

"(j) With respect to property ordered forfeited under this section, the Attorney General is authorized to

"(l) grant petitions for mitigation or remission of forfeiture, restore forfeited property to victims of a violation of this chapter, or take any other action to protect the rights of innocent persons which is in the interest of justice and which is not inconsistent with the provisions of this section;

"(2) compromise claims arising under this section;

"(3) award compensation to persons providing information resulting in a forfeiture under this section;

"(4) direct the disposition by the United States, in accordance with the provisions of section 511 (e) of this title (21 U.S,C. 881 (e)), of all property ordered forfeited under this section by public sale or any other commercially feasible means, making due provision for the rights of innocent persons; and

"(5) take appropriate measures necessary to safeguard and maintain property ordered forfeited under this section pending its disposition.

"APPLICABILITY OF CIVIL FORFEITURE PROVISIONS

"(k) Except to the extent that they are inconsistent with the provisions of this section, the provisions of section 511 (d) of this title (21 U.S.C. 881 (d)) shall apply to a criminal forfeiture under this section.

"BARON INTERVENTION

"(l) Except as provided in subsection (o), no party claiming an interest in property subject to forfeiture under this section may

"(l) intervene in a trial or appeal of a criminal case involving the forfeiture of such property under this section; or

"(2) commence an action at law or equity against the United States concerning the validity of his alleged interest in the property subsequent to the filing ofan indictment or information alleging that the property is subject to forfeiture under this section.

"JURISDICTION TO ENTER ORDERS

"(m) The district courts of the United States shall have jurisdiction to enter orders as provided in this section without regard to the location of any property which may be subject to forfeiture under this section or which has been ordered forfeited under this section.

"DEPOSITIONS

"(n) In order to facilitate the identification and location of property declared forfeited and to facilitate the disposition of petitions for remission or mitigation of forfeiture, after the entry of an order declaring property forfeited to the United States, the court may, upon application of the United States, order that the testimony of any witness relating to the property forfeited be taken by deposition and that any designated book, paper, document, record, recording, or other material not privileged be produced at the same time and place, in the same manner as provided for the taking of depositions under Rule 15 of the Federal Rules of Criminal Procedure.

"THIRD PARTY INTERESTS

"(o) (l) Following the entry ofan order of forfeiture under this section, the United States shall publish notice of the order and of its intent to dispose of the property for at least seven successive court days in such manner as the Attorney General may direct. The Government may also, to the extent practicable, provide direct written notice to any person known to have alleged an interest in the property that is the subject of the order of forfeiture as a substitute for published notice as to those persons so notified.

"(2) Any person, other than the defendant, asserting a legal interest in property which has been ordered forfeited to the United States pursuant to this section may, within thirty days of the final publication of notice or his receipt of notice under paragraph (l), whichever is early, petition the court for a hearing to adjudicate the validity of his alleged interest in the property. The hearing shall be held before the court alone, without a jury.

"(3) The petition shall be signed by the petitioner under penalty of perjury and shall set forth the nature and extent of the petitioner's right, title, or interest in the property, the time and circumstances of the petitioner's acquisition of the right, title, or interest in the property, any additional facts supporting the petitioner's claim, and the relief sought.

"(4) The hearing on the petition shall, to the extent practicable and consistent with the interests of justice, be held within thirty days of the filing of the petition. The court may consolidate the hearing on the petition with a hearing on any other petition filed by a person other than the defendant under this subsection.

"(5) At the hearing, the petitioner may testify and present evidence and witnesses on his own behalf, and cross-examine witnesses who appear at the hearing. The United States may present evidence and witnesses in rebuttal and in defense of its claim to the property and cross-examine witnesses who appear at the hearing. In addition to testimony and evidence presented at the hearing, the court shall consider the relevant portions of the record of the criminal case which resulted in the order of forfeiture.

"(6) If, after the hearing, the court determines that the petitioner has established by a preponderance of the evidence that

"(A) the petitioner has a legal right, title, or interest in the property, and such right, title, or interest renders the order of forfeiture invalid in whole or in part because the right, title, or interest was vested in the petitioner rather than the defendant or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which gave rise to the forfeiture of the property under this section; or

"(B) the petitioner is a bona fide purchaser for value of the right, title, or interest in the property and was at the time of purchase reasonably without cause to believe that the property was subject to forfeiture under this section; the court shall amend the order of forfeiture in accordance with its determination.

"(7) Following the court's disposition of all petitions filed under this subsection, or if no such petitions are filed following the expiration of the period provided in paragraph (2) for the filing of such petitions, the United States shall have clear title to property that is the subject of the order of forfeiture and may warrant good title to any subsequent purchaser or transferee."

"(p) The provisions of this section shall be liberally construed to effectuate its remedial purposes.

"INVESTMENT OF ILLICIT DRUG PROFITS

"SEC.414. (a) lt shall be unlawful for any person who has received any income derived, directly or indirectly, from a violation of this title or title lll punishable by imprisonment for more than one year in which such person has participated as a principal within the meaning of section 2 of title 18, United States Code, to use or invest, directly or indirectly, any part of such income, or the proceeds of such income, in acquisition of any interest in, or the establishment or operation of, any enterprise which is engaged in, or the activities of which affect interstate or foreign commerce. A purchase of securities on the open market for purposes of investment, and without the intention of controlling or participating in the control of the issuer, or of assisting another to do so, shall not be unlawful under this section if the securities of the issuer held by the purchaser, the members of his immediate family, and his or their accomplices in any violation of this title or title lll after such purchase do not amount in the aggregate to l per centum of the outstanding securities of any one class, and do not confer, either in law or in fact, the power to elect one or more directors of the issuer.

"(b) Whoever violates this section shall be fined not more than $50,000 or imprisoned not more than ten years, or both.

"(c) As used in this section, the term 'enterprise' includes any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity.

"(d) The provisions of this section shall be liberally construed to effectuate its remedial purposes.".

SEC. 304. Section 304 of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S.C. 824) is amended by adding at the end of subsection (f) the following sentence: "All right, title, and interest in such controlled substances shall vest in the United States upon a revocation order becoming final."

SEC. 305. Section 408 of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S.C. 848) is amended

  1. in subsection (a)

  2. by striking out "(l)'';

  1. by striking out "paragraph (2)'' each time it appears, and

inserting in lieu thereof "section 413 of this title''; and

  1. by striking out paragraph (2); and

  1. by striking out subsection (d).

SEC. 306. Section 51 l of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S.C. 881) is amended

  1. in subsection (a) by inserting at the end thereof the following new subsection :

"(7) All real property, including any right, title, and interest in the whole of any lot or tract of land and any appurtenances or improvements, which is used, or intended to be used, in any manner or part, to commit, or to facilitate the commission of, a violation of this title . punishable by more than one year's imprisonment, except that no property shall be forfeited under this paragraph, to the extent of an . interest ofan owner, by reason of any act or omission established by that . owner to have been committed or omitted without the knowledge or consent of that owner.'' ;

  1. in subsection (b) -

  2. by inserting "civil or criminal'' after "Any property subject .

to''; and

  1. by striking out in paragraph (4) "has been used or is intended to

be used in violation of" and inserting in lieu there of"is subject to civil or criminal forfeiture under";

  1. in subsection (c)

  2. by inserting in the second sentence "any of" after "Whenever

property is seized under''; and

  1. by inserting in paragraph (3) ", if practicable,'' after "re

move it'';

  1. in subsection (d), by inserting "any of" after "alleged to have been incurred, under'';

  2. in subsection (e) - .

  3. by inserting "civilly or criminally'' in the first sentence after

"Whenever property is''; and

  1. by striking out in paragraph (3) "and remove it for disposition''

and inserting in lieu thereof "and dispose of it''; and

  1. by inserting at the end thereof the following new subsections:

..(h) All right, title, and interest in property described in subsection (a) shall vest in the United States upon commission of the act giving rise to forfeiture under this section.

"(i) The filing of an indictment or information alleging a violation of this title or title III which is also related to a civil forfeiture proceeding under this section shall, upon motion of the United States and for good cause shown, stay the civil forfeiture proceeding.

"(j) In addition to the venue provided for in section 1395 of title 28, United States Code, or any other provision of law, in the case of property of a defendant charged with a violation that is the basis for forfeiture of the property under this section, a proceeding for forfeiture under this section may be brought in the judicial district in which the defendant owning such property is found or in the judicial district in which the criminal prosecution is brought.".

SEC. 307. Part A of title III of the Comprehensive Drug Abuse Prevention and Control Act of 1970 is amended by adding at the end thereof the following new section :

"CRIMINAL FORFEITURES

"SEC. 1017. Section 413 of title II, relating to criminal forfeitures, shall apply in every respect to a violation of this title punishable by imprisonment for more than one year.".

SEC. 308. The table of contents of the Comprehensive Drug Abuse Prevention and Control Act of 1979 is amended

  1. by adding immediately after "Sec.412. Applicability of treaties and other international agreements.". the following new items : ..Sec.413. Criminal forfeitures. ."Sec.414. investment of illicit drug profits.". and

  2. by adding immediately after "Sec. 1016. Authority of Secretary of the Treasury.". the following new item: ""Sec. 1017. Criminal forfeitures.".

PART C

SEC. 309. (a) Section 51 l (e) (l) of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S.C. 881 (e) (l)) is amended by adding after "retain the property for official use" the following: "or transfer the custody or ownership of any forfeited property to any Federal, State, or local agency pursuant to section 616 of the Tariff Act of 1930 (19 U.S.C. 1616),,.

  1. Section 511 (e) of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S.C. 881 (e)) is amended by inserting before "The proceeds from any sale under paragraph (2)'' the following: "The Attorney General shall ensure the equitable transfer pursuant to paragraph (l) of any forfeited property to the appropriate State or local law enforcement agency so as to reflect generally the contribution of any such agency participating directly in any of the acts which led to the seizure or forfeiture of such property. A decision by the Attorney General pursuant to paragraph (l) shall not be subject to review.''

  1. Section 51 l (e) of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S.C. 881 (e)) is further amended by striking out "the general fund of the United States Treasury'' in the sentence beginning "The Attorney General shall'' and inserting in lieu there of"accordance with section 524 (c) of title 28, United States Code''.

SEC. 310. Section 524 of title 28, United States Code, is amended by adding at the end the following new subsection:

"(c) (l) There is established in the United States Treasury a special fund to be known as the Department of Justice Assets Forfeiture Fund (hereinafter in this subsection referred to as the 'fund') which shall be available to the Attorney General without fiscal year limitation in such amounts as may be specified in appropriations Acts for the following purposes of the Department of Justice

"(A) the payment, at the discretion of the Attorney General, of any expenses necessary to seize, detain, inventory, safeguard, maintain, advertise, or sell property under seizure, detention, or forfeited pursuant to any law enforced or administered by the Deparment of Justice, or of any other necessary expenses incident to the seizure, detention, or forfeiture of such property; such payments may include payments for contract services and payments to reimburse any Federal, State, or local agency for any expenditures made to perform the foregoing functions;

"(B) the payment of awards for information or assistance leading to a civil or criminal forfeiture under the Comprehensive Drug Abuse

Prevention and Control Act of 1970 (21 U.S.C. 800 et seq.) or a criminal forfeiture under the Racketeer Influenced and Corrupt Organizations statute (18 U.S.C. 1961 et seq.), at the discretion of the Attorney .

General;

"(C) the compromise and payment of valid liens and mortgages against property that has been forfeited pursuant to any law enforced or administered by the Department of Justice, subject to the discretion of the Attorney General to determine the validity of any such lien or mortgage and the amount of payment to be made; and

"(D) disbursements authorized in connection with remission or mitigation procedures relating to property forfeited under any law enforced or administered by the Department of Justice.

"(2) Any award paid from the fund for information concerning a forfeiture, as provided in paragraph (l) (B), shall be paid at the discretion of the Attorney General or his delegate, except that the authority to pay an award of$10,000 or more shall not be delegated to any person other than the Deputy Attorney General, the Associate Attorney General, the Director of the Federal Bureau of Investigation, or the Administrator of the Drug Enforcement Administration. Any award for such information shall not exceed the lesser of $150,000 or one-fourth of the amount realized by the United States from the property forfeited. .

"(3) There shall be deposited in the fund all amounts from the forfeiture of property under any law enforced or administered by the Department of Justice remaining after the payment of expenses for forfeiture and sale authorized by law.

"(4) Amounts in the fund which are not currently needed for the purpose of this section shall be kept on deposit or invested in obligations of, or guaranteed by, the United States.

"(5) The Attorney General shall transmit to the Congress, not later than four months after the end of each fiscal year a detailed report on the amounts deposited in the fund and a description of expenditures made under this subsection.

"(6) The provisions of this subsection relating to deposits in the fund shall apply to all property in the custody of the Department of Justice on or after the effective date of the Comprehensive Forfeiture Act of 1983.

"(7) For fiscal years 1984, 1985, 1986, and 1987, there are authorized to be appropriated such sums as may be necessary for the purposes described in paragraph (l). At the end of each fiscal year, any amount in the fund in excess of the amount appropriated shall be deposited in the general fund of the Treasury of the United States, except that an amount not to exceed $5,000,000 may be carried forward and available for appropriation in the next fiscal year.

"(8) For the purposes of this subsection, property is forfeited pursuant to a law enforced or administered by the Department of Justice if it is forfeited pursuant to

"(A) any criminal forfeiture proceeding;

"(B) any civil judicial forfeiture proceeding; or

"(C) any civil administrative forfeiture proceeding conducted by the Department of Justice; except to the extent that the seizure was effected by a Customs officer or that custody was maintained by the Customs Service in which case the provisions of section 613 a of the Tariff Act of 1930 (19 U.S.C. 1613 a) shall apply.".

PART D

SEC. 311. Section 607 of the Tariff Act of 1930 (19 U.S.C. 1607) is amended to read as follows:

"§ 607. Seizure; value $100,000 or less, prohibited articles, transporting conveyances

"(a) If

"(l) the value of such seized vessel, vehicle, aircraft, merchandise, or baggage does not exceed $l00,000; .

"(2) such seized merchandise consists of articles the importation of which is prohibited; or

"(3) such seized vessel, vehicle, or aircraft was used to import, export, or otherwise transport or store any controlled substances; the appropriate customs officer shall cause a notice of the seizure of such articles and the intention to forfeit and sell or otherwise dispose of the same according to law to be published for at least three successive weeks in such manner as the Secretary of the Treasury may direct. Written notice of seizure together with information on the applicable procedures shall be sent to each party who appears to have an interest in the seized article.

"(b) As used in this section, the term 'controlled substance' has the meaning given that term in section 102 of the Controlled Substances Act (21 U.S.C. 802).',.

SEC. 312. Section 608 of the Tariff Act of 1930 (19 U.S.C, 1608) is amended in the second sentence by inserting after "penal sum of" the following: "$5,000 or 10 per centum of the value of the claimed property, whichever is lower, but not less than,''.

SEC. 313. Section 609 of the Tariff Act of 1930 (19 U.S.C. 1609) is amended by striking out "after deducting the actual expenses of seizure, publication, and sale in the Treasury of the United States.'' and inserting in lieu thereof"after deducting expenses enumerated in section 613 of this Act into the Customs Forfeiture Fund.''.

SEC. 314. Section 610 of the Tariff Act of 1930 (19 U.S.C. 1610) is amended by striking out "If the Value of any vessel, vehicle, merchandise, or baggage so seized is greater than $10,000,'' and substituting in lieu thereof the following: "If any vessel, vehicle, aircraft, merchandise, or baggage is not subject to the procedure set forth in section 607,''.

SEC. 315. Section 612 of the Tariff Act of 1930 (19 U.S.C, 1612) is amended by

  1. inserting "aircraft,'' immediately after "vehicle,'' wherever it

appears in the section;

  1. striking out "and the value of such vessel, vehicle, merchandise,

or baggage as determined under section 606 does not exceed §10,000,'' in the first sentence and inserting in lieu thereof the following: "and the article is subject to the provisions of section 607 of this Act,''; and

  1. striking out "If such value of such vessel, vehicle, merchandise,

or baggage exceeds $10,000,'' in the second sentence and inserting in lieu thereof the following: "If the article is not subject to the provisions of section 607 of this Act,''.

SEC. 316. Section 613 (a)(3) of the Tariff Act of 1930 (19 U.S.C, 1613 (a)(3)) is amended to read as follows:

"(3) The residue shall be deposited in the Customs Forfeiture

Fund.,,.

SEC. 317. The Tariff Act of 1930 is amended by adding a new section immediately after section 613 (19 U.S.C. 1613) to read as follows:

"§ 613a. Customs Forfeiture Fund

"(a) There is hereby established in the Treasury of the United States a special fund for the United States Customs Service that shall be entitled the 'Customs Forfeiture Fund' (hereinafter referred to in this section as the 'fund'). This fund shall be available without fiscal year limitation in such amounts as may be specified in appropriations Acts for the following purposes of the United States Customs Service

"(l) the payment of all proper expenses of the seizure or detention or the proceedings of forfeiture and sale (not otherwise recovered under section 613 (a)) including but not limited to, expenses of inventory, security, maintaining the custody of the property, advertising and sale, and if condemned by the court and a bond for such costs was not given, the costs as taxed by the court; and

"(2) the payment of awards of compensation to informers under section 619 of the Tariff Act of 1930, as amended.

"(b) There shall be deposited in the fund all proceeds from the sale or other disposition of property forfeited under, and any currency or monetary instruments seized and forfeited under, the laws enforced or administered by the United States Customs Service.

"(c) Amounts in the fund which are not currently needed for the purposes of this section shall be kept on deposit or invested in obligations of, or guaranteed by, the United States.

"(d) The Commissioner of Customs shall transmit to the Congress, not later than four months after the end of each fiscal year a detailed report on the amounts deposited in the fund and a description of expenditures made under this section.

"(e) The provisions of this section relating to deposits in the fund shall apply to all property in the custody of the United States Customs Service on or after the effective date of the Comprehensive Forfeiture Act of 1983.

"(f) For the purposes described in subsection (a), there are authorized to be appropriated from the fund for fiscal year 1984 not more than $10,000,000, for fiscal year 1985 not more than $15,000,000, for fiscal year 1986, not more than $20,000,()()0, and for fiscal year 1987 not more than $20,0()0,00(). Amounts in the fund in excess of the amounts appropriated at the end of each fiscal year shall be deposited in the General Fund of the Treasury of the United States. At the end of the last fiscal year for which appropriations from the fund are authorized by this Act, the fund shall cease to exist and any amount then remaining in the fund shall be deposited in the General Fund of the Treasury of the United States.,,.

SEC. 318. A new section 616 is added to the Tariff Act of 1930 (19 U,S.C. 1616) to read as follows :

"§ 616, Disposition of forfeited property

"(a) Notwithstanding any other provision of the law, the Commissioner is authorized to retain forfeited property, or to transfer such property on such terms and conditions as he may determine to -

"(l) any other Federal agency; or

"(2) any State or local law enforcement agency which participated directly in any of the acts which led to the seizure or forfeiture of the property. The Secretary of the Treasury shall ensure the equitable transfer pursuant to paragraph (2) of any forfeited property to the appropriate State or local law enforcement agency so as to reflect generally the contribution of any such agency participating directly in any of the acts which led to the seizure or forfeiture of such property. A decision by the Secretary pursuant to paragraph (2) shall not be subject to review. The United States shall not be liable in any action arising out of the use .of any property the custody of which was transferred pursuant to this section to any non-Federal agency.

"(b) The Secretary of the Treasury may order the discontinuance of any forfeiture proceedings under this Act in favor of the institution of forfeiture proceedings by State or local authorities under an appropriate State or local statute. After the filing of a complaint for forfeiture under this Act, the Attorney General may seek dismissal of the complaint in favor of forfeiture proceedings under State or local law.

"(c) Whenever forfeiture proceedings are discontinued by the United States in favor of State or local proceedings, the United States may transfer custody and possession of the seized property to the appropriate State or local official immediately upon the initiation of the proper actions by such officials.

"(d) Whenever forfeiture proceedings are discontinued by the United States in favor of State or local proceedings, notice shall be sent to all known interested parties advising them of the discontinuance or dismissal. The United States shall not be liable in any action arising out of the seizure, detention, and transfer of seized property to State or local officials.''.

SEC. 319. Section 619 of the Tariff Act of 1930 (19 U.S.C. 1619) is amended by

  1. striking out "$50,000'' each time it appears and inserting in lieu

thereof "$150,000'' ; and

  1. adding at the end thereof "In no event shall the Secretary

delegate the authority to pay an award under this rid="sin">section in excess of

$10,000 to an official below the level of the Commissioner of Customs.''.

SEC. 320. The Tariff Act of 1930 is amended by adding a new section 589, to read as follows:

"§589. Arrest authority of customs officers

"Subject to the direction of the Secretary of the Treasury, an officer of the Customs Service as defined in section 401 (i) of this Act, as amended, may

"(l) carry a firearm;

"(2) execute and serve any order, warrant, subpoena, summons, or other process issued under the authority of the United States;

"(3) make an arrest without a warrant for any offense against the

United States committed in the officer s presence or for a felony, cognizable under the laws of the United States committed outside the officer,s presence if the officer has reasonable grounds to believe that the person to be arrested has committed or is committing a felony ; and

"(4) perform any other law enforcement duty that the Secretary of the Treasury may designate.".

  1. Section 7607 of the Internal Revenue Act of 1954 (26 U.S.C. 7607) is repealed.

SEC. 321. Sections 6()2, 6()5, 606, 6()8, 609, 61 l, 613, 614, 615, 618, and 619 (19 U.S.C. 1602, 1605, 1606, 1608, 1609, 161 l, 1613, 1614, 1615, 1618, and 1619) of the Tariff Act of 1930 are amended by inserting the word "aircraft," immediately after the words "vehicle" or "vehicles," wherever they appear.

SEC. 322. Section 644 of the Tariff Act of 1930 (19 U.S.C, 1644) is amended to read as follows:

"§ 644. Application of the Federal Aviation Act and section 1518(d) of title 33

"(a) The authority vested by section 1109 of the Federal Aviation Act of 1958 (49 U.S.C. 1509) in the Secretary of the Treasury, by regulation to provide for the application to civil air navigation of the laws and regulations relating to the administration of customs, and of the laws and regulations relating to the entry and clearance of vessels, shall extend to the application in like manner of any of the provisions of this Act, or of the Anti-Smuggling Act of 1935, or of any regulations promulgated hereunder.

"(b) For purposes of section 1518(d) of title 33, the term 'customs laws administered by the Secretary of the Treasury' shall mean this chapter and any other provisions of law classified to this title.''.

SEC. 323. The Tariff Act of 1930 is amended by adding a new section 600 to read as follows:

"§ 600 Application of the customs Iaws to other seizures by customs officers

"The procedures set forth in sections 602 throuth 619 of this Act (19 U.S.C. 1602 through 1619) shall apply to seizures of any property effected by customs officers under any law enforced or administered by the Customs Service unless such law specifies different procedures.''.

References

001

USA Senate Report No.91-617, Ninety-first Congress 1st session 79 (1969).

002

2. The Racketeer Influenced and Corrupt Organization statute(RICO), passed by the Congress of the United States under the Organized Crime Control Act of 1970, Public Law 91-452

003

The Continuing Criminal Enterprise statute, passed by the Congress of theUnited States under the Comprehensive Drug Abuse Prevention and Control

004

D. B. Smith and E. C. Weiner, Criminal Forfeitures Under the RICO and Continuing Criminal Enterprie Statutes (Washington, D.C.,Criminal Division,

005

H. L. Myers and J. P. Brzostowski, Drug Agents' Guide to Forfeiture of Assets (Washington, D.C., Drug Enforcement Administration, 1981), p.

006

Comprehensive Drug Abuse Prevention and Control Act of 1970, Public Law 91-513, 21 USC 881 (a) (l) through 881 (a) (5).

007

J. C. Marrero and others, Forfeitures Volume I: Introduction to Civil Statutes (Washington, D. C., Asset Forfeiture Office, Criminal Division, U. S.

008

C. W. Blau and others, investigation and Prosecution of Illegal Money Laundering..A Guide to the Bank Secrecy Act (Washington, D.C., Narcotic and Dangerous Drug Section, Criminal Division, U.S.Department of Justice, 1983), p. 2.

009

Comprehensive Forfeiture Act of 1984, (CFA) passed by the Congress of the United States under the Comprehensive Crime Control Act of 1984, Public Law No.98-473, 12 October 1984.

010

Federal Rules of Criminal Procedure, Rule 32 (b) (2) (St.Paul, Minnesota, West, 1984), p. 96.

011

W. J. Corcoran and M. C. Carlson, "Criminal prosecution of drug traffickers under the Continuing Criminal Enterprise Statute in federal courts of the United