The U.S. Department of Homeland Security’s Immigration and Customs Enforcement (ICE) is seizing a record number of bank accounts for money laundering. In summary, here is how it works. A Special Agent from ICE submits an Affidavit to a Federal Judge, the Judge signs a Seizure Warrant authoring the Special Agent to serve that document upon the bank to seize whatever money is in that account. Although the seizure of such accounts may accomplish a legitimate law enforcement purpose in attempting to stop the illicit sale of narcotics by taking the money generated from those sales, the process is too easily abused by the U.S. Government.
The Affidavit filed by the Special Agent is usually “sealed” which means it will not be available to the public or even the person or company for which the bank account monies were seized. Due process should allow a claimant prompt access to that information so the account holder may meaningfully challenge the seizure in Federal Court. At a minimum, the Seizure Warrant should specify what the facts were that supported an allegation of money laundering. Right now, the standard language in the Seizure Warrant only states:
That’s it; that’s all you get from the U.S. Government as the reasons that your entire bank account has now been cleaned out, potentially leaving a company unable to pay its bills, including to its employees, or leaving a person desperate to pay his or her daily living expenses.
Bank account seizures now commonly allege trade based money laundering. According to the U.S. Department of Homeland Security, global trade is frequently used by criminal organizations to move money around the world such as by Colombian drug cartels to repatriate drug proceeds, a process commonly referred to as the Black Market Peso Exchange.
Fortunately, the law demands that the U.S. Attorney’s Office file a Complaint of Forfeiture against the bank account in Federal Court within a few months of the seizure of the bank account. The Complaint will finally state the general factual basis for the seizure, and you finally get your ‘day in court’. Typically, the assigned Assistant U.S. Attorney will share information with the attorney representing the owner of the seized account in an attempt to avoid a litigation battle. It is often to the advantage of both the Government and the account holder to attempt to work something out, otherwise, a lot of time and money will be spent in Federal Court litigation fighting over whether the money really is the proceeds of some ‘specified unlawful activity’ and whether or not the account owner is an ‘innocent owner’ to whom the money should be returned.
The Federal laws and procedures are the same throughout the United States for bank accounts seized pursuant to a Seizure Warrant for alleged trade-based money laundering. Such seizures are most likely to occur in Miami, the State of Texas, and the metro area of New York City.