Acting Chief of DOJ Asset Forfeiture Division Issues Guidance on Holder Equitable Sharing Order

On Tuesday, February 10, 2015, DOJ Asset Forfeiture and Money Laundering Section Acting Chief M. Kenndall Day issued a memo guiding agency participants in the DOJ's Asset Forfeiture Fund on the implementation of US Attorney General Eric Holder's January 16, 2015 order (effective March 1, 2015) governing use of the adoptive forfeiture process through the DOJ's Equitable Sharing program. 

When it was released, Holder's order was widely misunderstood; some commentators went to far as to claim the order ended civil forfeiture. However, the Holder order is extremely limited, and the Kenndall Day memo provides some clarity as to the scope of behavior implicated: 

Central to the application of the Attorney General's order is whether there was federal law enforcement oversight or participation at the time of seizure by state and local law enforcement. To ensure sufficient federal participation in all seizures that lead to federal forfeiture, an attorney from a federal agency must provide justification in writing for the federal forfeiture of an asset that is seized by a state or local law enforcement officer as a task force or joint investigation seizure, applying the factors outlined below. A prosecutor at the U.S. Attorney's Office for the district where the seizure took place (or if the seizure is part of an ongoing investigation, a prosecutor at the relevant U.S. Attorney's Office or Department litigating section) then must agree, in writing, that the forfeiture is permissible under the Attorney General's order.' This requirement extends to all types of forfeiture, including administrative. Federal prosecutors asked to provide such agreement must also consider the factors below when determining whether the seizure constitutes either a task force or joint investigation seizure.

Factors to Consider When Deciding Whether a Seizure Qualifies as a Task Force or Joint Investigation Seizure

  • Was the Seizure Effected by a Federal Task Force Officer? -- Is the state and local law enforcement officer who effected the seizure a task force officer on a joint federal and state task force? Is the officer deputized to enforce federal criminal law under either Title 18 or Title 21? Does the officer possess credentials issued by a federal law enforcement agency? Is the officer assigned to work on a task force full-time? Is the officer bound by the rules, regulations, and policies that otherwise govern the conduct of federal agents employed by the agency that issued the credentials to the officer? If the officer is assigned to the task force only part time or for a specific investigation, do the facts clearly demonstrate that the seizure was part of the officer's task force duties rather than a state or local law enforcement action, as described below?

  • Were Federal Authorities Involved Prior To and At the Moment of Seizure? -- Was the seizure made with direct, pre-seizure involvement by federal law enforcement? For example, at the time of the seizure, was the seizing officer acting under the direction of, or in real-time, hand-in-hand cooperation with, federal law enforcement? Was the seizure made as part of a preexisting federal or joint federal-state investigation in which federal agents are involved in the pursuit of federal criminal charges?

  • Does the Seizure Relate Primarily to State or Local Law Enforcement Action? -- Was the seizure made pursuant to a state seizure warrant without federal involvement? Is the state pursuing a criminal case under state law against the owner of the property? Did the officer seize the asset pursuant to his or her authority as a state or local law enforcement officer? 

I've noted in previous commentary that the Holder order will incentivize a proliferation of federal partnerships with state and local law enforcement, as agencies seek to retain their federal asset forfeiture revenues. The Day memo only clarifies the process and best practices for the operation of those partnerships.

While M. Kenndall Day's guidance on the implementation of the Holder memo resolves some fundamental questions about the implementation of the Holder order, it is to be noted that it does not represent statutory law, nor does it offer additional protections to property owners facing asset forfeiture. Any US Attorney who does not strictly adhere to the policy would only face the discretionary sanction of the President (practically speaking, this never happens). 


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