Real Property Seizure and Disposal Program Improvements Needed

GAO discussed the Department of Justice's management of seized and forfeited real property to determine whether the government received the maximum possible economic return. GAO found that: (1) as of January 1987, Justice had 866 properties valued at $170 million; (2) of the 47 property sales it reviewed, 26 had realized no net economic return; (3) because Justice did not properly identify defendants' property equity, it unnecessarily processed properties with marginal economic returns; (4) Justice experienced substantial problems in selling property because it did not comply with forfeiture requirements; (5) insurance companies were reluctant to insure forfeited properties because of the questions concerning the constitutionality of real property forfeitures; and (6) Justice lacked staff competent to deal with the complex issues involved in title transfers of forfeited properties. GAO believes that Justice should improve: (1) the accuracy of real property inventory data; and (2) compliance with established requirements before seizure.