Improving the Effectiveness of Criminal Forfeiture of Assets

Illegal activities generate billions of dollars annually, and the Government's efforts to take the profit out of crime through asset forfeiture has had little success. In its efforts to improve the Government's forfeiture program, the Department of Justice has: (1) issued guidance to prosecutors on the use of forfeiture statutes; (2) started to accumulate forfeiture statistics to analyze the extent to which forfeiture provisions are used and the reasons for their success or failure; (3) made forfeiture a goal in every major drug investigation; and (4) issued a detailed drug agents' guide for forfeiture of assets. Legislative changes are needed to strengthen the forfeiture authorizations. Four major legislative problem areas have been identified: (1) the scope of the forfeiture authorizations is too narrow and in many respects does not cover forfeiture of profits; (2) it is not clear whether any ill-gotten gains can be reached when a de facto combination of individuals constitutes the only enterprise through which a defendant engages in racketeering activity; (3) the extent to which assets must be traced to the crime is unclear; and (4) transfers of assets prior to conviction limit the effectiveness of forfeiture. Legislation has been proposed which addresses these problem areas, but they differ in approach. H.R. 4110 and S. 1126 track the legislative package contained in a recent GAO report and would amend both of the forfeiture authorization statutes. H.R. 2646 would amend one of the statutes, but not the other, and would only apply to those racketeering activities involving drugs. GAO endorses the more comprehensive approach proposed by H.R. 4110. Under this bill, all organized criminals who use a de facto association would also forfeit their profits. H.R. 4110 would authorize forfeiture of substitute assets to the extent that the defendant's profits cannot be located, have been transferred to third parties, or have been placed beyond the jurisdiction of the courts. H.R. 2910 amends the civil forfeiture authorization for drug assets to permit the use of forfeiture proceeds for the purchase of evidence and information in drug investigations. To provide better congressional oversight, GAO believes that Congress should consider a requirement in this amendment that the Attorney General estimate the amount of funds anticipated to be available under it and determine how these funds will be spent.