asset forfeiture and international cooperation

Benjamin B. WagnerBenjamin B. WagnerU.S. Department of JusticeU.S. Department of Justice

Asset Forfeiture and Asset Forfeiture and International CooperationInternational Cooperation

Why Asset Forfeiture?Why Asset Forfeiture?

Deprive criminals of the profits of Deprive criminals of the profits of their crimes;their crimes;Break up criminal organizations, and Break up criminal organizations, and prevent the financing of further prevent the financing of further crimes;crimes;Recover stolen assets or provide Recover stolen assets or provide restitution to victims or the restitution to victims or the government. government.

UN Convention Against CorruptionUN Convention Against Corruption

Article 31Article 31: Each State to take measures : Each State to take measures to enable tracing, freezing, seizure and to enable tracing, freezing, seizure and confiscation of proceeds of corruption, and confiscation of proceeds of corruption, and property obtained with such proceeds.property obtained with such proceeds.Articles 54 and 55Articles 54 and 55: Each State to take : Each State to take measures to provide mutual legal measures to provide mutual legal assistance through:assistance through:•• The enforcement of foreign orders to freeze, The enforcement of foreign orders to freeze,

seize and confiscate proceeds of corruption, seize and confiscate proceeds of corruption, and and

•• The freezing, seizing and confiscation of The freezing, seizing and confiscation of proceeds of foreign crimes of corruption proceeds of foreign crimes of corruption through the requested Statethrough the requested State’’s own civil or s own civil or criminal processes. criminal processes.

OVERVIEWOVERVIEW

I. Summary of U.S. Forfeiture I. Summary of U.S. Forfeiture LawLawII. Mechanisms for II. Mechanisms for International Assistance by International Assistance by the United Statesthe United StatesInternational Sharing of International Sharing of Forfeited AssetsForfeited Assets

TERMINOLOGYTERMINOLOGY

Seizure/Preventative MeasuresSeizure/Preventative Measures•• TemporaryTemporary•• Seize, Restrain, Freeze, Seize, Restrain, Freeze, ImmobilizeImmobilize

Final ForfeitureFinal Forfeiture•• OwnershipOwnership•• Forfeiture, ConfiscationForfeiture, Confiscation

I. United States I. United States Forfeiture LawForfeiture Law

UNITED STATES FORFEITURE UNITED STATES FORFEITURE SYSTEMSSYSTEMS

Criminal Forfeiture Criminal Forfeiture In RemIn Rem Forfeiture Forfeiture Executive/Administrative Executive/Administrative Forfeiture (by law Forfeiture (by law enforcement agency, usually enforcement agency, usually only with consent, assets in only with consent, assets in the United States)the United States)

U.S. CRIMINAL FORFEITUREU.S. CRIMINAL FORFEITURE

Need Need personal Jurisdictionpersonal Jurisdiction ((in in personampersonam) ) -- -- defendant must be defendant must be present;present;Included in criminal case, need Included in criminal case, need criminal conviction in the U.S.;criminal conviction in the U.S.;ADVANTAGE: Government can forfeit ADVANTAGE: Government can forfeit criminalcriminal’’s legitimate property if illicit s legitimate property if illicit assets cannot be found.assets cannot be found.

Criminalizes the movement of funds into Criminalizes the movement of funds into or out of the United States with intent to or out of the United States with intent to carry on carry on ““specified unlawful activity;specified unlawful activity;””““SUASUA”” includes many U.S. crimes, but also includes many U.S. crimes, but also foreign crimes such as bribery of a public foreign crimes such as bribery of a public official, embezzlement of public funds, and official, embezzlement of public funds, and fraud against a foreign bank;fraud against a foreign bank;Criminal and Criminal and in in remrem ForfeitureForfeiture-- The fundsThe funds-- Facilitating propertyFacilitating property

Laundering of Monetary Laundering of Monetary InstrumentsInstruments

18 U.S.C. Section 1956(a)(2)18 U.S.C. Section 1956(a)(2)

Criminalizes Bulk Cash SmugglingCriminalizes Bulk Cash Smuggling-- $10,000 or more$10,000 or more-- Into or out of United StatesInto or out of United States-- Intent to evade reportingIntent to evade reportingCriminal and Criminal and in in remrem ForfeitureForfeiture-- The CurrencyThe Currency-- Facilitating propertyFacilitating property

Bulk Cash SmugglingBulk Cash Smuggling31 U.S.C. Section 533231 U.S.C. Section 5332

Criminal Forfeiture and Criminal Forfeiture and Assets OverseasAssets Overseas

18 U.S.C. Section 981(k)18 U.S.C. Section 981(k)

Where forfeitable funds are in a Where forfeitable funds are in a foreign bank, and cannot be seized, foreign bank, and cannot be seized, U.S. may seize funds in that foreign U.S. may seize funds in that foreign bankbank’’s correspondent accounts at a s correspondent accounts at a bank in the United Statesbank in the United States; ; Correspondent account funds are Correspondent account funds are deemed to be the foreign criminal deemed to be the foreign criminal deposits;deposits;PracticePractice: Last resort, if mutual legal : Last resort, if mutual legal assistance not available.assistance not available.

Criminal Forfeiture and Criminal Forfeiture and Assets Overseas (2)Assets Overseas (2)

CCourt can order Defendant to ourt can order Defendant to repatriate funds to the United repatriate funds to the United States; States; Failure to comply could increase Failure to comply could increase sentence or lead to contempt of sentence or lead to contempt of court;court;If failure to comply, assistance from If failure to comply, assistance from foreign government necessaryforeign government necessary

U.S. U.S. IN REMIN REM FORFEITUREFORFEITURE

Need only Need only in in remrem jurisdiction jurisdiction -- --court must exercise some control court must exercise some control over the propertyover the property;;

Only property derived from or Only property derived from or involved in the involved in the crime in the U.S.;crime in the U.S.;ADVANTAGE: ADVANTAGE: Criminal conviction not Criminal conviction not necessary, can forfeit property from necessary, can forfeit property from dead criminals or fugitivesdead criminals or fugitives..

In In RemRem Forfeiture and Assets Forfeiture and Assets OverseasOverseas

Basis for forfeiture as if property Basis for forfeiture as if property were located in the U.S. were located in the U.S. Other country takes action on Other country takes action on U.S. request to give U.S. court U.S. request to give U.S. court control over property (ex. Freeze control over property (ex. Freeze a bank account)a bank account)Jurisdiction over foreign assets Jurisdiction over foreign assets of terrorists targeting the United of terrorists targeting the United StatesStates

Obstructionist LitigantsObstructionist LitigantsSanctions for failure to produce bank Sanctions for failure to produce bank records located in a foreign bankrecords located in a foreign bank: can : can include dismissal of the partyinclude dismissal of the party’’s claim if the s claim if the records are material and claimant could records are material and claimant could obtain the records or waive bank secrecy obtain the records or waive bank secrecy laws, but does not. laws, but does not. 18 U.S.C. Section 986(d) 18 U.S.C. Section 986(d)

Fugitive disentitlement doctrineFugitive disentitlement doctrine: claim : claim dismissed if party knows of dismissed if party knows of In In RemRemforfeiture proceeding, but stays away from forfeiture proceeding, but stays away from the United States in order to avoid the United States in order to avoid criminal charges. criminal charges. 28 U.S.C. Section 246628 U.S.C. Section 2466

II. MECHANISMS FOR II. MECHANISMS FOR INTERNATIONAL ASSISTANCE INTERNATIONAL ASSISTANCE

FROM THE UNITED STATESFROM THE UNITED STATES

ASSISTANCE FROM THE U.S.ASSISTANCE FROM THE U.S.

Investigatory assistance/mutual legal Investigatory assistance/mutual legal assistanceassistanceU.S. initiates its own forfeiture actionU.S. initiates its own forfeiture action-- Criminal ForfeitureCriminal Forfeiture-- In remIn rem ForfeitureForfeitureEnforce foreign forfeiture judgmentsEnforce foreign forfeiture judgmentsProvisional restraint mechanismsProvisional restraint mechanisms

Investigatory Assistance and Investigatory Assistance and Mutual Legal AssistanceMutual Legal Assistance

Informal police to police assistance; Informal police to police assistance; INTERPOL;INTERPOL;FIU information sharing through FIU information sharing through EgmontEgmont Group;Group;Formal mutual legal assistance Formal mutual legal assistance request (pursuant to treaty);request (pursuant to treaty);Letter Letter rogatoryrogatory or other assistance or other assistance request (where no treaty).request (where no treaty).

Tips on International Assistance in Tips on International Assistance in Asset RecoveryAsset Recovery

DonDon’’t publicize your investigation, or t publicize your investigation, or assets will be gone;assets will be gone;Always find out as much as possible Always find out as much as possible through informal channels first;through informal channels first;Find out what can be obtained informally, Find out what can be obtained informally, and what requires formal legal assistance and what requires formal legal assistance request;request;May need a first request for investigation, May need a first request for investigation, a second to seize, confiscate, or take a second to seize, confiscate, or take other action.other action.

Tips on International Assistance in Tips on International Assistance in Asset Recovery (2)Asset Recovery (2)

If a formal request or other legal action is If a formal request or other legal action is necessary, the prosecutor should speak necessary, the prosecutor should speak directly with attorneys in the foreign directly with attorneys in the foreign country to learn what possible tools are country to learn what possible tools are available and practical for your case;available and practical for your case;In the United States, contact should be In the United States, contact should be with the Department of Justicewith the Department of Justice’’s Office of s Office of International Affairs. International Affairs. •• Office of International Affairs Office of International Affairs

Criminal Division, Department of JusticeCriminal Division, Department of Justice1301 New York Avenue, N.W., 81301 New York Avenue, N.W., 8thth FloorFloorWashington, DC 20005Washington, DC 20005

Request to the U.S. Request to the U.S. for Evidencefor Evidence

Purpose for which evidence sought; Purpose for which evidence sought; Summary of facts, including Summary of facts, including connection between the target and connection between the target and the evidence;the evidence;Legal description of offenses charged Legal description of offenses charged or investigated;or investigated;Detailed description of evidence;Detailed description of evidence;Identifying information on Identifying information on individuals;individuals;

Request to the U.S. Request to the U.S. for Evidence (2)for Evidence (2)

Search/SeizureSearch/Seizure•• Affidavit establishing Probable Cause Affidavit establishing Probable Cause

that evidence is:that evidence is:-- Relevant to the investigation, and Relevant to the investigation, and -- Can be found at that locationCan be found at that location

•• Full description of the property to be Full description of the property to be seized.seized.

Date by which evidence needed;Date by which evidence needed;Confidentiality requirements.Confidentiality requirements.

Initiating a Criminal Forfeiture Initiating a Criminal Forfeiture Action Under U.S. LawAction Under U.S. Law

18 U.S.C. Section1956(c)(7)(B)18 U.S.C. Section1956(c)(7)(B)

U.S. money laundering predicates include:U.S. money laundering predicates include:•• Foreign official bribery;Foreign official bribery;•• Embezzlement of foreign public funds;Embezzlement of foreign public funds;•• Bank fraud (by or against a foreign Bank fraud (by or against a foreign

bank);bank);•• Export control violations/Munitions Export control violations/Munitions

smuggling;smuggling;•• Crimes of violence, narcotics, terrorism;Crimes of violence, narcotics, terrorism;•• Any crime for which for which U.S. Any crime for which for which U.S.

would be obliged to extradite under a would be obliged to extradite under a multilateral treaty.multilateral treaty.

Initiating an Initiating an In In RemRem Forfeiture Forfeiture Action Under U.S. LawAction Under U.S. Law

Proceeds of foreign money laundering Proceeds of foreign money laundering predicatespredicates -- 18 U.S.C. Section 981(a)(1)(C);18 U.S.C. Section 981(a)(1)(C);

Property involved in money laundering Property involved in money laundering transactions transactions -- 18 U.S.C. Section 981(a)(1)(A)18 U.S.C. Section 981(a)(1)(A)

Proceeds and instrumentalities of foreign Proceeds and instrumentalities of foreign narcotics offenses narcotics offenses –– 18 U.S.C. Section 18 U.S.C. Section 981(a)(1)(B)981(a)(1)(B)

Enforcement of Foreign JudgmentsEnforcement of Foreign Judgments28 U.S.C. Section 246728 U.S.C. Section 2467

Jurisdiction & Venue Jurisdiction & Venue District Court in District of ColumbiaDistrict Court in District of ColumbiaWhere property or defendant locatedWhere property or defendant located

Can obtain Restraining OrderCan obtain Restraining OrderRegister & Enforce Foreign JudgmentRegister & Enforce Foreign Judgment

Offenses in Vienna ConventionOffenses in Vienna ConventionOffenses for which forfeiture available in Offenses for which forfeiture available in U.S.U.S.Certification by Attorney GeneralCertification by Attorney General

Enforcement of Foreign JudgmentsEnforcement of Foreign Judgments28 U.S.C. Section 246728 U.S.C. Section 2467

Court bound by factual findings in Court bound by factual findings in foreign judgment;foreign judgment;Enforce Judgment Unless:Enforce Judgment Unless:-- System Incompatible with Due ProcessSystem Incompatible with Due Process-- No personal jurisdictionNo personal jurisdiction-- No subject matter jurisdictionNo subject matter jurisdiction-- Insufficient notice to DefendantInsufficient notice to Defendant-- Judgment obtained by fraudJudgment obtained by fraud

Request to the U.S. toRequest to the U.S. toEnforce a JudgmentEnforce a Judgment

Complete description of the asset;Complete description of the asset;Summary of case facts and description of Summary of case facts and description of forfeiture proceedings;forfeiture proceedings;Certified copy of judgment;Certified copy of judgment;Affidavit or sworn declaration stating: Affidavit or sworn declaration stating: -- Defendant received notice in time to Defendant received notice in time to defenddefend-- Judgment in force and not subject to Judgment in force and not subject to appealappealAdditional information as requiredAdditional information as required

Provisional MeasuresProvisional Measures

PrePre--Trial restraining order Trial restraining order –– 18 U.S.C. 18 U.S.C. 981(b)(4)981(b)(4)

--Person arrested/charged AbroadPerson arrested/charged Abroad-- ExEx--ParteParte 3030--day freeze to await day freeze to await evidenceevidenceArrest/Seize on Probable CauseArrest/Seize on Probable Cause-- Seizure Warrant Seizure Warrant -- Arrest Warrant Arrest Warrant in remin rem

Provisional MeasuresProvisional MeasuresRegister and enforce foreign Restraining Register and enforce foreign Restraining OrderOrder –– 28 U.S.C. Section 2467(d)(3)28 U.S.C. Section 2467(d)(3)

-- Attorney General Must CertifyAttorney General Must Certify

-- Treaty or Agreement RequiredTreaty or Agreement RequiredForeign RequestForeign Request-- Affidavit describing foreign action and Affidavit describing foreign action and reasonable basis to believe property will reasonable basis to believe property will be forfeitedbe forfeited-- Hearing upon noticeHearing upon notice-- Treaty or Forfeiture Agreement RequiredTreaty or Forfeiture Agreement Required

Request to the U.S. for Request to the U.S. for Provisional RestraintProvisional Restraint

If opening US forfeiture caseIf opening US forfeiture case::-- Required info for opening U.S. caseRequired info for opening U.S. case-- Copy of arrest documentation or Copy of arrest documentation or indictment (BUT need probable cause indictment (BUT need probable cause evidence within 30 days),evidence within 30 days),If in anticipation of enforcement of foreign If in anticipation of enforcement of foreign orderorder::-- Required information for enforcement of Required information for enforcement of a Judgmenta Judgment-- Affidavit or Certified copy of restraining Affidavit or Certified copy of restraining order (BUT need evidence for hearing order (BUT need evidence for hearing within 10 days)within 10 days)

III. INTERNATIONAL III. INTERNATIONAL ASSET SHARINGASSET SHARING

International Asset SharingInternational Asset SharingTo increase international To increase international cooperation;cooperation;Since 1989 more than $188 million Since 1989 more than $188 million shared from Department of Justice to shared from Department of Justice to 35 countries;35 countries;U.S. case in which other government U.S. case in which other government must have participated in supporting must have participated in supporting forfeiture of assets directly or forfeiture of assets directly or indirectly;indirectly;Requires treaty or agreement Requires treaty or agreement authorizing sharing (can be caseauthorizing sharing (can be case--specific).specific).

International Asset SharingInternational Asset Sharing

GuidelinesGuidelines

Essential Assistance: (50% Essential Assistance: (50% -- 80%)80%)Major Assistance: (40% 0 50%)Major Assistance: (40% 0 50%)Facilitating Assistance: (Up to 40%)Facilitating Assistance: (Up to 40%)


GuidelinesGuidelines

Essential Assistance: (50% Essential Assistance: (50% -- 80%)80%)-- Waive own forfeiture actionWaive own forfeiture action-- Repatriate w/o account signatory letterRepatriate w/o account signatory letter-- Virtually all case evidenceVirtually all case evidence-- Defending litigationDefending litigation


GuidelinesGuidelinesSubstantial Assistance (40% Substantial Assistance (40% -- 50%)50%)-- Enforcing a US order and repatriatingEnforcing a US order and repatriating-- Freezing/lifting freeze over assetsFreezing/lifting freeze over assets-- Repatriating via extradition request Repatriating via extradition request -- Substantial foreign law enforcement Substantial foreign law enforcement

resourcesresources-- Physical Danger for foreign agentsPhysical Danger for foreign agents


GuidelinesGuidelinesFacilitating Assistance (Up to 40%)Facilitating Assistance (Up to 40%)

-- Tip infoTip info-- Providing bank, financial recordsProviding bank, financial records-- Helping convince foreign banks to Helping convince foreign banks to

repatriaterepatriate-- Service/witness interviewsService/witness interviews


Limitations:Limitations:Only the Deputy Attorney General or Only the Deputy Attorney General or the Subsecreatry of Treasury can the Subsecreatry of Treasury can approve; approve; Secretary of State must concur;Secretary of State must concur;Congress can object;Congress can object;Sharing may be prohibited by law.Sharing may be prohibited by law.

Questions?Questions?

Benjamin WagnerBenjamin Wagner

U.S. Department of JusticeU.S. Department of Justice

Resident Legal Advisor, IndonesiaResident Legal Advisor, Indonesia

asset forfeiture and international cooperation

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