FORFEITURE ISSUES MONDAY, NOVEMBER 25, 1985 HOUSE OF REPRESENTATIVES, The subcommittee met, pursuant to call, at 9:10 a.m.. in the Metro Dade County Commission chambers, Metro Dade Center, second floor, 111 NW. First Street, Miami, FL, Hon. William J. Hughes (chairman of the subcommittee) presiding. Present: Representatives Hughes, Feighan, Smith, and Shaw. Staff present: Edward O'Connell, counsel, and Charlene Vanlier Heydinger, associate counsel. Mr. HUGHES. The Subcommittee on Crime will come to order. The Chair has received a request to cover this hearing in whole or in part by radio broadcast, still photography, television, and by other methods. In accordance with rule 5(a), permission will be granted unless there is objection. Hearing no objection, permission is granted. Good morning and welcome to the Subcommittee on Crime's hearing on forfeiture issues. Today we are following up on a subject that we discussed at length in Fort Lauderdale, on October 14, 1983, that is, the Comprehensive Drug Penalty Act. That bill envolved into a major portion of the comprehensive crime bill which became law on October 12, 1984. With its passage, the Federal Government received valuable, new tools in its war on drug trafficking, including a tenfold increase in fines, criminal forfeiture provisions for all Federal felony drug cases, and other substantive and administrative changes in the law requested by the executive branch. As such, the Federal Government was given much greater power to forfeit the fruits of drug-related crime. [A copy of the Comprehensive Crime Control Act of 1984 follows:] COMPREHENSIVE CRIME CONTROL ACT OF 1984 H.J. RES. 648 P.L. #98-473 Signed By the President On October 12, 1984 H.J. Res. 648-204 been convicted of a crime of violence or otherwise serious offense; and (3) the general appropriateness of imposing a sentence of imprisonment in cases in which the defendant has been convicted of a crime of violence or otherwise serious offense. CHAPTER III-FORFEITURE SEC. 301. This title may be cited as the "Comprehensive Forfeiture Act of 1984". PART A SEC. 302. Section 1963 of title 18 of the United States Code is amended to read as follows: "§ 1963. Criminal penalties "(a) Whoever violates any provision of section 1962 of this chapter shall be fined not more than $25,000 or imprisoned not more than twenty years, or both, and shall forfeit to the United States, irrespective of any provision of State law "(1) any interest the person has acquired or maintained in violation of section 1962; "(2) any “(A) interest in; "(B) security of; "(C) claim against; or "(D) property or contractual right of any kind affording a source of influence over; any enterprise which the person has established, operated, controlled, conducted, or participated in the conduct of, in violation of section 1962; and "(3) any property constituting, or derived from, any proceeds which the person obtained, directly or indirectly, from racketeering activity or unlawful debt collection in violation of section 1962. The court, in imposing sentence on such person shall order, in addition to any other sentence imposed pursuant to this section, that the person forfeit to the United States all property described in this subsection. "(b) Property subject to criminal forfeiture under this section includes "(1) real property, including things growing on, affixed to, and found in land; and "(2) tangible and intangible personal property, including rights, privileges, interests, claims, and securities. "(c) All right, title, and interest in property described in subsection (a) vests in the United States upon the commission of the act giving rise to forfeiture under this section. Any such property that is subsequently transferred to a person other than the defendant may be the subject of a special verdict of forfeiture and thereafter shall be ordered forfeited to the United States, unless the transferee establishes in a hearing pursuant to subsection (m) that he is a bona fide purchaser for value of such property who at the time of purchase was reasonably without cause to believe that the property was subject to forfeiture under this section. "(d) If any of the property described in subsection (a)— "(1) cannot be located; H.J. Res. 648-205 "(2) has been transferred to, sold to, or deposited with, a third party; "(3) has been placed beyond the jurisdiction of the court; "(4) has been substantially diminished in value by any act or omission of the defendant; or "(5) has been commingled with other property which cannot be divided without difficulty; the court shall order the forfeiture of any other property of the defendant up to the value of any property described in paragraphs (1) through (5). "(eX1) Upon application of the United States, the court may enter a restraining order or injunction, require the execution of a satisfactory performance bond, or take any other action to preserve the availability of property described in subsection (a) for forfeiture under this section "(A) upon the filing of an indictment or information charging a violation of section 1962 of this chapter and alleging that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture under this section; or "(B) prior to the filing of such an indictment or information, if, after notice to persons appearing to have an interest in the property and opportunity for a hearing, the court determines that "(i) there is a substantial probability that the United States will prevail on the issue of forfeiture and that failure to enter the order will result in the property being destroyed, removed from the jurisdiction of the court, or otherwise made unavailable for forfeiture; and "(ii) the need to preserve the availability of the property through the entry of the requested order outweighs the hardship on any party against whom the order is to be entered: Provided, however, That an order entered pursuant to subparagraph (B) shall be effective for not more than ninety days, unless extended by the court for good cause shown or unless an indictment or information described in subparagraph (A) has been filed. "(2) A temporary restraining order under this subsection may be entered upon application of the United States without notice or opportunity for a hearing when an information or indictment has not yet been filed with respect to the property, if the United States demonstrates that there is probable cause to believe that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture under this section and that provision of notice will jeopardize the availability of the property for forfeiture. Such a temporary order shall expire not more than ten days after the date on which it is entered, unless extended for good cause shown or unless the party against whom it is entered consents to an extension for a longer period. A hearing requested concerning an order entered under this paragraph shall be held at the earliest possible time, and prior to the expiration of the temporary order. "(3) The court may receive and consider, at a hearing held pursuant to this subsection, evidence and information that would be inadmissible under the Federal Rules of Evidence. "(f) Upon conviction of a person under this section, the court shall enter a judgment of forfeiture of the property to the United States and shall also authorize the Attorney General to seize all property |