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Department of Justice Controversial Asset Forfeiture Program Resumed

On March 28, 2016, the Department of Justice announced it was resuming its contentious “equitable sharing” program that it had suspended only months earlier. The “equitable sharing” program allows liquidated assets seized in asset forfeiture cases to be shared between state and federal law enforcement authorities with local agencies receiving up to 80 percent of the asset value of assets seized under federal law.

On December 21, 2015, the Department of Justice had announced it was suspending a program because of budget cuts included in last year’s spending bill. Department of Justice Spokesman Peter J. Carr explained, “[i]n the months since we made the difficult decision to defer equitable sharing payments because of the $1.2 billion rescinded from the Asset Forfeiture Fund, the financial solvency of the fund has improved to the point where it is no longer necessary to continue deferring equitable sharing payments.” Mr. Carr further clarified “[t]he Asset Forfeiture Fund acts in many ways like a revolving fund. Forfeited proceeds are being deposited throughout the year to replenish the funds that are simultaneously flowing out of the Asset Forfeiture Fund to pay for approved agency expenses.”

A wide-ranging Washington Post investigation in 2014 found that police had seized $2.5 billion in cash alone without warrants or indictments since 2001. In response, former Attorney General Eric Holder announced new restrictions on some federal asset forfeiture practices. These restrictions were meant to limit the ability of state and local law enforcement officials to choose more lenient federal forfeiture guidelines over state law. However, critics maintain that the reforms still leave discretion for local authorities to choose to rely on more permissive federal laws by acting as part of a joint task force with federal authorities.

The resumption of the program will greatly hinder companies who seek restitution from employees who have committed crimes. Rather than allow forfeited assets to be used to make a victimized company whole, law enforcement will likely attempt to keep the assets for itself.

Jackson Lewis P.C. © 2022National Law Review, Volume VI, Number 97
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About this Author

Ramsay C. McCullough, Jackson Lewis, Affirmative Action Counseling Lawyer, Employment Discrimination Attorney
Associate

Ramsay C. McCullough is an Associate in the Norfolk, Virginia, office of Jackson Lewis P.C. His labor and employment counseling and litigation practice includes wage and hour laws, employment discrimination laws, the National Labor Relations Act, affirmative action and OFCCP counseling, white collar defense, False Claims Act and Qui Tam/Whistleblower defense, internal investigations, corporate governance and compliance issues, regulatory training, and asset recovery.

Mr. McCullough is an experienced trial attorney. He...

757-648-1444
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