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In Rem Forfeiture Proceedings and Extraterritorial Jurisdiction

Published online by Cambridge University Press:  17 January 2008

Lionel Smith
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Extract

In U.S. v. All Funds on Deposit in Any Accounts Maintained in the Names of Meza or de Castro1 the US Court of Appeals for the Second Circuit affirmed that US federal courts have jurisdiction, in civil proceedings brought by the US government, to order the forfeiture to that government of funds held in English bank accounts. An understanding of this decision requires some background in US forfeiture law and also in the history of the particular proceedings.

Type
Shorter Articles, Comments and Notes
Information
International & Comparative Law Quarterly , Volume 45 , Issue 4 , October 1996 , pp. 902 - 909
Copyright
Copyright © British Institute of International and Comparative Law 1996

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References

1. 63 F.3d 148 (1995); cert, denied, 116 S.Ct. 1541 (1996).

2. See e.g. the Drug Trafficking Act 1994.

3. To be effective this legislative strategy also requires the criminalisation of money laundering: see Gilmore, W. C., Dirty Money: The Evolution of Money Laundering Counter-Measures (1995), pp.22–26.Google Scholar

4. See Smith, D. B., Prosecution and Defense of Forfeiture Cases (looseleaf, 1985–1995).Google Scholar

5. See esp. 18 U.S.C. §981 (1994); 21 U.S.C. §881 (1994).

6. See e.g. the Canadian Criminal Code. R.S.C. 1985. c. C–46, s.462.38. Note that this is not truly civil forfeiture since it requires the commencement of criminal proceedings, followed by the death or absconding of the accused.

7. U.S. v. Banco Cafetero Panama 797 F.2d 1154 (2nd Cir. 1986).

8. U.S. v. 15 Black Ledge Drive, Marlborough, Connecticut 897 F.2d 97. 101–102 (2nd Cir. 1990).Google Scholar

9. Supra n.7.

10. See 18 U.S.C. §984 (1994), enacted in 1992 and discussed in U.S. v. All Funds Presently on Deposit or Attempted to be Deposited in Any Accounts Maintained at American Express Bank 832 F. Supp. 542 (E.D.N.Y. 1993): the provision applies to civil forfeiture arising out of violations of the money-laundering offences in 18 U.S.C. §§1956, 1957, 1960 (1994) and 31 U.S.C. §§5322 and 5324 (1994).

11. Austin v. U.S. 113 S.Ct. 2801 (1993).

12. U.S. v. James Daniel Good Real Property 114 S.Ct. 492 (1993).

13. Bennis v. Michigan 116 S.Ct. 994 (1996). This case arose under a State statute essentially providing for civil forfeiture. Federal civil forfeiture statutes generally have an “innocent owner” defence.

14. U.S. v. $405,089.23 33 F.3d 1210 (9th Cir. 1994); rehearing denied, 56 F.3d 41 (9th Cir. 1995); cert, granted, 116 S.Ct. 762 (1996); U.S. v. Ursery 59 F.3d 568 (6th Cir. 1995); cert, granted, 116 S.Ct. 762 (1996).

15. U.S. v. 163 Renwick St., Newburgh, N. Y. 859 F. Supp. 93 (S.D.N.Y. 1994); contra, U.S. v. 228 Acres of Land and Dwelling Located on Whites Hill Road, Chester, Vermont 916 F.2d 808, 814 (2nd Cir. 1990); cert, denied, 498 U.S. 1091 (1991).

16. U.S. v. All Funds on Deposit in Any Accounts Maintained at Merrill Lynch, Pierce Fenner & Smith 801 F. Supp. 984, 989, 991 (E.D.N.Y. 1992); affd. sub nom. U.S. v. Daccarett 6 F.3d 37 (2nd Cir. 1993); cert, denied, 114 S.Ct. 1294 (1994).

17. See Marine Midland Bank, N.A. v. U.S. 11 F.3d 1119 (2nd Cir. 1993); Gordon, J. E., “Prosecutors Who Seize Too Much and the Theories They Love” (1995) 44 Duke L.J. 744Google Scholar; Smith, , op. cit. supra n.4, at ¶1.02.Google Scholar

18. See Pratt, G. C. and Petersen, W. B., “Civil Forfeiture in the Second Circuit” (1991) 65 St. John's L.R. 653; and the range of views expressed in the symposium papers at (1994) 39 N.Y. Law School L.R. 1–371.Google Scholar

19. Civil Asset Forfeiture Reform Act, H.R. 1916.

20. Supra n.1.

21. Santacruz was killed by Colombian police on 5 Mar. 1996: The Economist, 9 03 1996, p.29.Google Scholar

22. T.S. No.32 (1989), Cm.755.

23. S.I. 1990/1199, as amended.

24. As substituted by the Criminal Justice Act 1988, s. 103(1) and Sch.5, Part I. paras. 1,15.

25. Although the bulk of the Act was repealed in 1995 by the Drug Trafficking Act 1994, that Act provides by its s.66(1), and Sch.2, para. 1, that the 1990 Order remain in force until replaced.

26. Unrep.

27. The action was brought under both 18 U.S.C. §981(a)(1)(A) (1994) (which applies to property “involved in” money-laundering offences) and 21 U.S.C. §881(a)(6) (1994) (which applies to proceeds of drug offences). In both cases, if the action is successful, the property is forfeited to the US government; indeed, the forfeiture relates back to the time at which the property became forfeitable: 18 U.S.C. §981(f) (1994): 21 U.S.C. §881(h) (1994).

28. Re JL: Drug Trafficking Offences Act 1986, The Times, 4 May 1994 (QBD); the full transcript is available on Lexis.

29. Consolidated in the 1990 Order's Sch.3.

30. Supra n. 16.

31. 856 F. Supp. 759 (E.D.N.Y. 1994).

32. Republic National Bank of Miami v. U.S. 113 S.Ct. 554 (1992); see also Castrique v. Imrie (1870) L.R. 4 H.L. 414, 429, 448.Google Scholar

33. Collins, L. (Ed.), Dicey and Morris on the Conflict of Laws (12th edn, 1993), p.442.Google Scholar

34. [1990] Ch. 48 (CA).

35. [1990] 1 Q.B. 202 (CA).

36. Supra n.31, at p.763.

37. Ibid.

38. S.12(7) of Sch.3 to the 1990 Order.

39. Supra n.1, at p.154.

40. Art.5(4)(g); Art.7(20).

41. See Gilmore, op. cit. supra n.3, at chap.IV.

42. Supra nn.17–19.

43. Supra n.1.

44. S.26A also requires that the order be Anal, and that the “person against whom the order is made” either appeared in the proceedings or had proper notice of them.

45. [1981] A.C. 470, 485 (HL).