NCJ Number
142160
Journal
Criminal Justice Volume: 8 Issue: 1 Dated: (Spring 1993) Pages: 10-15,61- 62
Date Published
1993
Length
8 pages
Annotation
This article examines the impact of forfeiture law and procedures on innocent third parties and what the legal rights of these parties are in protecting their financial interests under forfeiture law.
Abstract
The increased volume of forfeiture actions has drawn numerous third parties into forfeiture litigation, particularly banks who have given mortgages on property allegedly purchased with narcotics proceeds or used to facilitate drug trafficking. The complexities of forfeiture litigation and inconsistencies in court decisions make it difficult to vindicate the rights of innocent owners of seized property. Lenders must keep the specter of forfeiture firmly in mind throughout all phases of a commercial transaction and take appropriate steps to protect their interest in property loaned or held as collateral for a loan. Procedures must not only be enacted but also followed. The groundwork for defense of innocent ownership must be laid during the early stages of the lending process. After- the-fact efforts to establish innocence in the face of omissions during the loan process will more likely fail than succeed. Lenders are not the only entities at risk. Any business through which illegal proceeds may pass is at risk. These businesses, too, must develop preventative procedures, or they risk damages and expensive forfeitures. A business that finds itself thrust into the role of third-party claimant must be prepared to pursue complete recovery aggressively and should not presume that the courts will automatically permit recovery of all incidental costs and related expenses. The result in a specific case is driven not by the law but rather by the facts of the case. The trend apparently favors awards of fees and interest to innocent third-party lienholders, but such parties' chances of recovery seem particularly affected by the facts of the case, the attitude of the presiding judge, and the ability and persistence of counsel.