Boots & Sabers

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0711, 31 May 16

Not very civil forfeitures

My column for the West Bend Daily News is online. Hopefully it’s an issue upon which there should be omnipartisan agreement. Here it is:

The Internal Revenue Service has been in the news a lot lately for targeting conservative organizations in an effort to silence them. What has gone largely unnoticed, however, is how the IRS is also ruining the lives of average Americans by aggressively seizing their money for dubious reasons. It is something that can, and should, be stopped immediately.

For years, the IRS has had the power to seize assets involved with a crime. For example, the IRS can seize the money in the bank accounts of convicted drug dealers. But the IRS can also seize the assets of people who are only suspected of committing a crime through federal civil forfeiture laws. This is where the real problem comes in by putting innocent citizens in the position of having to prove their innocence in order to get their money back from the federal government.

With the federal civil forfeiture laws, the IRS can seize assets based only on the suspicion that a crime has taken place. There is no burden for the IRS to prove they have probable cause to a judge or charge the targeted person with anything. All that needs to happen is a few IRS bureaucrats decide something illegal might be going on and they can seize every dollar from the targeted person. Once the assets are seized, the IRS initiates a civil forfeiture procedure where the victim must defend themself. Unlike a criminal case, the IRS has a much lower burden of proof. They must only prove a crime was committed by a “preponderance of the evidence,” not by a “reasonable doubt,” which is the standard for criminal cases. Also, the defendant is not afforded all the same rights and protections in a civil proceeding as they would in a criminal prosecution.

These civil forfeiture proceedings are no small matter. The process often takes well over a year and the defendant must spend thousands of dollars and countless hours battling the IRS. Meanwhile, the IRS continues to hold the defendant’s assets, leaving the defendant bereft of the funds needed for his or her defense. And unlike criminal cases, defendants are not afforded a court-appointed attorney if they cannot afford one. When it is all said and done, the defendant may recover his or her seized funds, but only after a tremendous amount of time, effort and money.

One particular area of growth in civil forfeitures is in targeting so-called “structuring.” Under federal law, banks must report all transactions of more than $10,000 to the IRS. Criminals know this, so they will often “structure” their banking practices in a way to avoid that requirement by making many transactions for $9,000 or $9,500 instead of one big transaction. The IRS looks for this kind of behavior as an indication of criminal activity and will move to seize the funds through civil forfeiture laws without even knowing what kind of criminal activity might be happening.

You see, there is absolutely nothing illegal about conducting a bunch of banking transactions for $9,000. It may be a sign of illegal activity, or it may just be people doing nothing untoward at all. Many small businesses that use cash, for example, make daily deposits for several thousand dollars, but less than $10,000. These are some of the people being swept up in the IRS’ aggressive use of civil forfeitures.

According to a study last year by the Institute for Justice, the IRS initiated 500 percent more seizures for structuring in 2012 than it did in 2005, and 80 percent of those seizures were civil instead of criminal. At least a third of those seizures arose out of nothing more than a few banking transactions of less than $10,000 with no criminal activity even being alleged by the government. And the gap between what the IRS has seized and what was eventually forfeited after the process was complete is growing. Less than half the money seized in 2012 was actually finally forfeited.

All of these facts point to an increasing attitude of the IRS to seize first and ask questions later. This puts an intolerable burden on citizens who have not done anything wrong.

The solution is simple: end civil forfeitures. If someone has engaged in a crime, then the government should charge them and they should be afforded all the due process protections required by our conscience and the Constitution. We should not permit our government to seize the property of citizens on the mere suspicion of criminal activity by a bunch of unelected bureaucrats.


0711, 31 May 2016

1 Comment

  1. Kevin Scheunemann

    Abolishing the IRS is the only way this will get done.

    Taking this one tool away still leaves the IRS with all kinds of unconstitutional tools to work with.

    Anything IRS and WI DOR related, you are guilty until proven innocent in a court of law, even when you were following the written guidence on the subject from the agency!…speaking from firsthand experience.

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