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Mr. KEENEY. Mr. Chairman, there are a number of investigations going on in this general area. I think the Unites States Attorney provided you with a great deal of information with respect to what has been seized and what has been identified as being forfeitable property.
There are still some matters that are open. As a matter of fact, some of the Criminal Investigation is still open in that matter. Chairman PICKLE. You are saying then that in some of the Rayful Edmond cases that indictments are underway?
Mr. KEENEY. Well, some of the indictments are underway. Let me amend that, some of the indictments are underway in the narcotic violations and some are pending trial.
There are investigations involving not only the people using the cash but some who accepted it. Because we are reluctant to discuss it, we could not give you a complete report on the total Rayful Edmond case because of the completeness of the investigation.
Chairman PICKLE. Are you investigating merchants in the Rayful Edmond case?
Mr. KEENEY. Yes.
Chairman PICKLE. Did you start that investigation before or after our subcommittee mentioned the merchants?
Mr. KEENEY. I don't know. I think we started the investigation before. I would have to check that.
Chairman PICKLE. I think the facts will show that. But we are left to believe and it serves the purpose of only emphasizing the point, but actually this Rayful Edmond case is over 2 years old and no indictments were done until we talked to the merchants and they admitted they had not filed these forms.
Is that essentially correct?
Mr. KEENEY. It is essentially correct, Mr. Chairman.
The point I am trying to make, Mr. Chairman, is that the U.S. Attorneys office is still following through on those investigations. The matter is not complete. Because of that, we cannot give you a complete report. We would like to be allowed to go our own way and complete the investigation and maximize the likelihood of being able to indict and convict some of these merchants.
Chairman PICKLE. It would appear to this member that where you have a clear case of these transactions having taken place, clear evidence that cash was transferred, the merchants admitted a violation of law had taken place. It has been going on now for 2 years.
And you are just now getting indictments. It seems to me that since the facts are so clearly established that surely we will have some result of these cases pending.
Mr. KEENEY. Mr. Chairman, I would like you to give us the opportunity to complete our investigation and go forward with the most effective cases. Second, the effective date of the smurfing amendments was not until November 1988. Some amendments discussed here today were cases which took place prior to that time.
I am asking for your patience, Mr. Chairman. Let me add one thing. If we don't do a good job, call us up here and call us in to account.
Chairman PICKLE. Well, I would say, when did you get religion, so to speak. I think that is a question that has to be asked because of the time involved. We will not proceed with that.
Now we are all in agreement, I think, that if there has been a violation, these cases ought to be prosecuted.
Mr. KEENEY. Agreed.
Chairman PICKLE. I think the Congress and the country is going to be expecting us to do something instead of handling paperwork. Mr. KEENEY. You have a right to expect that, Mr. Chairman. Chairman PICKLE. I think we have a right to. Now, do you have any suggestions for us in the committee as representatives of the Congress to try to find a better answer to process these things? Do we need to change the law? Do we need to make specific legal corrections?
Mr. KEENEY. There are some changes. I think some of the changes pending in the omnibus legislation might be helpful. Stef, do you want to comment?
Mr. CASSELLA. We have proposed 50 or 55 amendments to the forfeiture statues in title XXI which are pending in the Senate-passed bill and in one that is pending in the House.
One amendment to 60501 would correct it, so that it punishes the crime as a felony and not a misdemeanor. We recognized that problem as soon as the initial statute was passed. Moreover, 6050Ï has no forfeiture provision as CTR statutes do.
Earlier today there were discussions about dissemination of the 60501, form 8300 reports which we would ask you to consider.
Chairman PICKLE. It sounds to me like your almost sole emphasis has been on the narcotics approach, to catch the big drug men, and not on the average merchants, whether they comply or not. Is that essentially correct?
Mr. CASSELLA. I would disagree that we concentrate only on narcotics. We perceive money laundering covering the gamut from white collar crime to narcotics. It is true that we have been focusing on the other money laundering statutes, CTR statutes, section 1956 and 1957 statutes. Until 1988, the 60501 statute only had a 1year misdemeanor penalty. The changes were made less than 2 years ago.
It is true that until then we focused on the other areas. I believe you are absolutely correct, though, in calling our attention to section 60501. I agree we have to have major prosecutions under that statute.
Chairman PICKLE. I can understand why you would be focusing on the drug lords and the narcotics problems. That is understandable. But the law says anybody dealing with cash transactions of over $10,000 must fill out these forms. I don't think you have looked at that as far as business is concerned at all.
Obviously, you have not because it is basically 4 to 6 years and you have done nothing to fix it. The law says res ipsa loquitur. Essentially, it speaks for itself. We have looked at one aspect only, not the business community as a whole. Do you disagree?
Mr. KEENEY. Sir, there is an assumption being made here today which is not accurate. I cannot go into detail and refute it but to say we are totally inactive with respect to the business community
in the violations of this statute is not accurate. I think at some point in the future that will be made apparent.
Chairman PICKLE. I accept your protestation on it but I also say that the results have to speak for themselves. Somewhere in between what you proclaim is a protestation and what is the result, remains the truth.
That remains to be seen. The law should be complied with by everybody, shouldn't it?
Mr. KEENEY. Mr. Chairman, I think the committee is performing a great service in making known, as these hearings are making known, the fact that the small business community, in particular, and the business community in general is not abiding by this and making clear that you are telling the Treasury Department, the IRS and the Department of Justice that you expect prosecution in this area.
I think that is a great service. We are all getting the message. Chairman PICKLE. I appreciate that.
Mr. SHAW. Thank you.
I would like to associate myself with the Chairman's expression of frustration and dissatisfaction with the Department's direction as to this particular form. I know you have a lot of things on your plate. You are short handed and there are a lot of problems and perhaps this is one not at the top of your list.
I think from the standpoint of just carrying out the intent of Congress that some type of prosecution is necessary and that some of these cases must go to prosecution. I can well understand your statement with regard to on-going prosecutions but surely something should have been completed by now and you should be able to stand here and give us some kind of statistics but you have been unable to do so.
Certainly, I would go along with your request. I don't want to put out something in a future meeting that might compromise the Department's efforts.
I have in addition to those comments, just one additional question. With regard to the answers you all gave concerning the 15 seizure items listed in a letter. You may know this committee has been very active in looking at the confiscated assets, the sale of these assets particularly in the Customs Service. These 15 assets that were provided in the letter of September 7, on some of them there is the disposition made and in others you do not. Perhaps that is because you still have them in your custody.
I would like to know for the purposes of the record, unless you have the information today, that these 15 items be listed as to disposition, what price you got for them, what expenses were there of sale and custody.
Mr. KEENEY. We don't have that today but we will be glad to get it for you.
Mr. SHAW. If you could supply that for the record, I think that would be very helpful.
[The information follows:]
John C. Keeney, Deputy Assistant Attorney General, Criminal Division, U. S. Department of Justice, has asked that I respond to your request for information concerning the disposition of fifteen assets seized in the Rayful Edmond III et al. drug investigation in the District of Columbia.
The information submitted in the enclosure was provided by Assistant United States Attorney for the District of Columbia, John P. Dominguez. He has submitted all available information on the status of the fifteen assets. You will note in the enclosure that ten of the items were not seized because four were sold to an innocent third party; two were traded for other items which were subsequently seized; and four are subject to seizure if and when located. The remaining five items were FBI or DEA seizures from the Rayful Edmond III investigation.
This information is hereby submitted in the format provided by Christopher A. Smith of your staff. If I may be of further assistance, please contact me at 514-1263 in the Asset Forfeiture Office of the Criminal Division.
Properties Involved in Rayful Edmond
The swimming pool was not seized because it had been
Violator ID: Rayful Edmond III.
Lien Payments: Not applicable.
Sale Price: Included in the sale of 12200 Kingswell St.,
Buyer ID: Ford T. Johnson (innocent third party).
Seizure No: Not applicable.
The property was not seized because it had been sold to an innocent third party.
12200 Kingswell Street, Mitchellville, MD.
Buyer ID: Ford T. Johnson (innocent third party).