From: believer@telepath.com Subject: IP: Tougher laws are sought to seize cash Date: Thu, 17 Sep 1998 08:45:24 -0500 To: believer@telepath.com Source: Bergen (New Jersey) Record http://www.bergen.com/news/njmone199809154.htm Tougher laws are sought to seize cash Tuesday, September 15, 1998 By ADAM PIORE Washington Correspondent WASHINGTON -- Federal law enforcement officials on Monday unveiled a plan they say will help stop the flow of billions of dollars in drug money across the nation's borders every year. Hailed as a "major step forward" in the fight against money laundering, the Justice Department proposal would broaden the government's ability to seize the profits of such illicit activity as drug dealing. It now is illegal to try to leave the country with more than $10,000 in currency without reporting it to U.S. Customs officials. Violations are punishable by up to five years in prison and seizure of the money. But in June, the U.S. Supreme Court dealt a serious blow to efforts to seize the unreported cash, ruling in a precedent-setting case that such seizures often violate constitutional protections against "excessive fines." The new proposal is aimed at correcting the loopholes opened up in the June court decision. It would for the first time allow law enforcement officials to arrest people concealing currency before they even reach the border. It would allow the seizure of $10,000 or more at the nation's ports and highways -- hundreds of miles from any crossing -- if agents can prove that there is intent to smuggle the concealed money out of the country. But it goes beyond that, giving agencies tools they have not had in the fight to stop the flow of illegal drug profits out of the country, said Stefan D. Cassella, the assistant chief of the money-laundering and forfeiture section of the U.S. Department of Justice. "This is a major step forward to address a new problem," Cassella said. "We know that the covert movement of currency across borders is indicative and inherently related to criminal activity." Civil libertarians condemned the proposed law, which the Justice Department sent to Congress on Monday, because they said it would expand the ability of law enforcement agencies to seize currency and keep it. A series published in The Record this year revealed how New Jersey, with its sprawling seaport, international airport, lax laws, and proximity to New York and Philadelphia, had emerged as a hub for money laundering and currency smuggling over the past 15 years. Cassella said the decision to push for the more stringent laws was inspired in part by The Record's stories. In its letter to Congress, the Justice Department cited the series as evidence of the growing problem in currency smuggling. The proposed law would give officials the ability to go after a wider range of smuggling that has been difficult for them to stop. Every year, for instance, billions of dollars in illegal drug profits is smuggled across the border unchecked, crammed into washing machines, refrigerators, or hidden under false bottoms in suitcases and trucks bound for the border. Over the past nine months, customs inspectors have seized more than $11 million at the border that stretches from Texas to California. And at Port Newark, Customs agents seized $5.5 million in fiscal year 1997, the fourth-highest amount seized among all U.S. ports. Cassella said the Justice Department hopes its proposal will be offered as an amendment to money-laundering legislation being considered by the House. But several congressional staffers were skeptical that the proposal would be considered by this Congress, because of the controversy over civil forfeiture. Congress is slated to adjourn is less than a month. In addition, the new regulations, if passed, would likely face immediate legal challenges. In June, the U.S. Supreme Court overturned the seizure of $357,144 from a Hollywood, Calif., gas station owner. Federal officials seized Hosep Krikor Bajakajian's money after the Syrian immigrant tried to carry it out of the country without reporting it -- even though he was told of the federal reporting requirements by customs agents. A divided court ruled the fine was excessive because the only impact of Bajakajian's crime was to deprive the government of "information on a piece of paper." By creating a category of crime called "bulk cash smuggling," law enforcement officials hope to convince the Supreme Court that efforts to evade detection could have a direct impact on the "security and integrity" of the nation's borders, Cassella said. The crime would be punishable by up to five years in prison and forfeiture of the money involved. "Bulk cash smuggling is an inherently more serious offense than simply failing to file a customs report," Justice Department officials wrote in an explanation of the bill provided to Congress. "Because the constitutionality of forfeiture is dependent on the 'gravity of the offense' . . . it is anticipated that the full forfeiture of smuggled money will withstand constitutional scrutiny in most cases." Local prosecutors hailed the proposed change. "Clearly, it's an effort to convince the Supreme Court that Congress did view this as more than a mere reporting violation and that forfeiture of the smuggled money is appropriate," said Marion Percell, an assistant U.S. Attorney in Newark who specializes in money-laundering cases. Critics attacked the bill, calling it just another effort by overzealous law enforcement officials to expand seizure powers that deprive citizens of due process. Roger Pilon, director of the Center for Constitutional Studies at the Cato Institute, warned that civil asset forfeiture is subject to abuse by law enforcement authorities. "This is unbelievable," he said. "Everything that Justice does in this area is characterized as a 'major step.' But that's no justification. Since when is it a crime to take money out of the country? After all, whose money is it?" Rachel King, legislative counsel of the American Civil Liberties Union, agreed. "The problem is they have too much power to seize property," she said. "The laws need to go the other way. What they can do already is scary." Staff Writers Julie Fields and Thomas Zambito contributed to this article. Copyright © 1998 Bergen Record Corp. ----------------------- NOTE: In accordance with Title 17 U.S.C. section 107, this material is distributed without profit or payment to those who have expressed a prior interest in receiving this information for non-profit research and educational purposes only. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml ----------------------- ********************************************** To subscribe or unsubscribe, email: majordomo@majordomo.pobox.com with the message: (un)subscribe ignition-point email@address ********************************************** www.telepath.com/believer **********************************************