[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1658 Referred in Senate (RFS)]

  1st Session
                                H. R. 1658


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             June 28, 1999

  Received; read twice and referred to the Committee on the Judiciary

_______________________________________________________________________

                                 AN ACT


 
    To provide a more just and uniform procedure for Federal civil 
                  forfeitures, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Civil Asset Forfeiture Reform Act''.

SEC. 2. CREATION OF GENERAL RULES RELATING TO CIVIL FORFEITURE 
              PROCEEDINGS.

    Section 981 of title 18, United States Code, is amended--
            (1) by inserting after subsection (i) the following:
    ``(j)(1)(A) In any nonjudicial civil forfeiture proceeding under a 
civil forfeiture statute, with respect to which the agency conducting a 
seizure of property must give written notice to interested parties, 
such notice shall be given as soon as practicable and in no case more 
than 60 days after the later of the date of the seizure or the date the 
identity of the interested party is first known or discovered by the 
agency, except that the court may extend the period for filing a notice 
for good cause shown.
    ``(B) A person entitled to written notice in such proceeding to 
whom written notice is not given may on motion void the forfeiture with 
respect to that person's interest in the property, unless the agency 
shows--
            ``(i) good cause for the failure to give notice to that 
        person; or
            ``(ii) that the person otherwise had actual notice of the 
        seizure.
    ``(C) If the Government does not provide notice of a seizure of 
property in accordance with subparagraph (A), it shall return the 
property and may not take any further action to effect the forfeiture 
of such property.
    ``(2)(A) Any person claiming property seized in a nonjudicial 
forfeiture proceeding may file a claim with the appropriate official 
after the seizure.
    ``(B) A claim under subparagraph (A) may not be filed later than 30 
days after--
            ``(i) the date of final publication of notice of seizure; 
        or
            ``(ii) in the case of a person entitled to written notice, 
        the date that notice is received.
    ``(C) The claim shall state the claimant's interest in the 
property.
    ``(D) Not later than 90 days after a claim has been filed, the 
Attorney General shall file a complaint for forfeiture in the 
appropriate court or return the property, except that a court in the 
district in which the complaint will be filed may extend the period for 
filing a complaint for good cause shown or upon agreement of the 
parties.
    ``(E) If the Government does not file a complaint for forfeiture of 
property in accordance with subparagraph (D), it shall return the 
property and may not take any further action to effect the forfeiture 
of such property.
    ``(F) Any person may bring a claim under subparagraph (A) without 
posting bond with respect to the property which is the subject of the 
claim.
    ``(3)(A) In any case where the Government files in the appropriate 
United States district court a complaint for forfeiture of property, 
any person claiming an interest in the seized property may file a claim 
asserting such person's interest in the property within 30 days of 
service of the Government's complaint or, where applicable, within 30 
days of alternative publication notice.
    ``(B) A person asserting an interest in seized property in 
accordance with subparagraph (A) shall file an answer to the 
Government's complaint for forfeiture within 20 days of the filing of 
the claim.
    ``(4)(A) If the person filing a claim is financially unable to 
obtain representation by counsel, the court may appoint counsel to 
represent that person with respect to the claim.
    ``(B) In determining whether to appoint counsel to represent the 
person filing the claim, the court shall take into account such factors 
as--
            ``(i) the claimant's standing to contest the forfeiture; 
        and
            ``(ii) whether the claim appears to be made in good faith 
        or to be frivolous.
    ``(C) The court shall set the compensation for that representation, 
which shall be equivalent to that provided for court-appointed 
representation under section 3006A of this title, and to pay such cost 
there are authorized to be appropriated such sums as are necessary as 
an addition to the funds otherwise appropriated for the appointment of 
counsel under such section.
    ``(5) In all suits or actions brought under any civil forfeiture 
statute for the civil forfeiture of any property, the burden of proof 
is on the United States Government to establish, by clear and 
convincing evidence, that the property is subject to forfeiture.
    ``(6)(A) An innocent owner's interest in property shall not be 
forfeited under any civil forfeiture statute.
    ``(B) With respect to a property interest in existence at the time 
the illegal conduct giving rise to forfeiture took place, the term 
`innocent owner' means an owner who--
            ``(i) did not know of the conduct giving rise to 
        forfeiture; or
            ``(ii) upon learning of the conduct giving rise to the 
        forfeiture, did all that reasonably could be expected under the 
        circumstances to terminate such use of the property.
    ``(C) With respect to a property interest acquired after the 
conduct giving rise to the forfeiture has taken place, the term 
`innocent owner' means a person who, at the time that person acquired 
the interest in the property, was--
            ``(i)(I) a bona fide purchaser or seller for value 
        (including a purchaser or seller of goods or services for 
        value); or
            ``(II) a person who acquired an interest in property 
        through probate or inheritance; and
            ``(ii) at the time of the purchase or acquisition 
        reasonably without cause to believe that the property was 
        subject to forfeiture.
    ``(D) Where the property subject to forfeiture is real property, 
and the claimant uses the property as the claimant's primary residence 
and is the spouse or minor child of the person who committed the 
offense giving rise to the forfeiture, an otherwise valid innocent 
owner claim shall not be denied on the ground that the claimant 
acquired the interest in the property--
            ``(i) in the case of a spouse, through dissolution of 
        marriage or by operation of law; or
            ``(ii) in the case of a minor child, as an inheritance upon 
        the death of a parent,
and not through a purchase. However, the claimant must establish, in 
accordance with subparagraph (C), that at the time of the acquisition 
of the property interest, the claimant was reasonably without cause to 
believe that the property was subject to forfeiture.
    ``(7) For the purposes of paragraph (6)--
            ``(A) ways in which a person may show that such person did 
        all that reasonably can be expected may include demonstrating 
        that such person, to the extent permitted by law--
                    ``(i) gave timely notice to an appropriate law 
                enforcement agency of information that led the person 
                to know the conduct giving rise to a forfeiture would 
                occur or has occurred; and
                    ``(ii) in a timely fashion revoked or attempted to 
                revoke permission for those engaging in such conduct to 
                use the property or took reasonable actions in 
                consultation with a law enforcement agency to 
                discourage or prevent the illegal use of the property; 
                and
            ``(B) in order to do all that can reasonably be expected, a 
        person is not required to take steps that the person reasonably 
        believes would be likely to subject any person (other than the 
        person whose conduct gave rise to the forfeiture) to physical 
        danger.
    ``(8) As used in this subsection:
            ``(1) The term `civil forfeiture statute' means any 
        provision of Federal law (other than the Tariff Act of 1930 or 
        the Internal Revenue Code of 1986) providing for the forfeiture 
        of property other than as a sentence imposed upon conviction of 
        a criminal offense.
            ``(2) The term `owner' means a person with an ownership 
        interest in the specific property sought to be forfeited, 
        including a leasehold, lien, mortgage, recorded security 
        device, or valid assignment of an ownership interest. Such term 
        does not include--
                    ``(i) a person with only a general unsecured 
                interest in, or claim against, the property or estate 
                of another;
                    ``(ii) a bailee unless the bailor is identified and 
                the bailee shows a colorable legitimate interest in the 
                property seized; or
                    ``(iii) a nominee who exercises no dominion or 
                control over the property.
    ``(k)(1) A claimant under subsection (j) is entitled to immediate 
release of seized property if--
            ``(A) the claimant has a possessory interest in the 
        property;
            ``(B) the continued possession by the United States 
        Government pending the final disposition of forfeiture 
        proceedings will cause substantial hardship to the claimant, 
        such as preventing the functioning of a business, preventing an 
        individual from working, or leaving an individual homeless; and
            ``(C) the claimant's likely hardship from the continued 
        possession by the United States Government of the seized 
        property outweighs the risk that the property will be 
        destroyed, damaged, lost, concealed, or transferred if it is 
        returned to the claimant during the pendency of the proceeding.
    ``(2) A claimant seeking release of property under this subsection 
must request possession of the property from the appropriate official, 
and the request must set forth the basis on which the requirements of 
paragraph (1) are met.
    ``(3) If within 10 days after the date of the request the property 
has not been released, the claimant may file a motion or complaint in 
any district court that would have jurisdiction of forfeiture 
proceedings relating to the property setting forth--
            ``(A) the basis on which the requirements of paragraph (1) 
        are met; and
            ``(B) the steps the claimant has taken to secure release of 
        the property from the appropriate official.
    ``(4) If a motion or complaint is filed under paragraph (3), the 
district court shall order that the property be returned to the 
claimant, pending completion of proceedings by the United States 
Government to obtain forfeiture of the property, if the claimant shows 
that the requirements of paragraph (1) have been met. The court may 
place such conditions on release of the property as it finds are 
appropriate to preserve the availability of the property or its 
equivalent for forfeiture.
    ``(5) The district court shall render a decision on a motion or 
complaint filed under paragraph (3) no later than 30 days after the 
date of the filing, unless such 30-day limitation is extended by 
consent of the parties or by the court for good cause shown.''; and
            (2) by redesignating existing subsection (j) as subsection 
        (l).

SEC. 3. COMPENSATION FOR DAMAGE TO SEIZED PROPERTY.

    (a) Tort Claims Act.--Section 2680(c) of title 28, United States 
Code, is amended--
            (1) by striking ``law-enforcement'' and inserting ``law 
        enforcement''; and
            (2) by inserting before the period the following: ``, 
        except that the provisions of this chapter and section 1346(b) 
        of this title do apply to any claim based on the destruction, 
        injury, or loss of goods, merchandise, or other property, while 
        in the possession of any officer of customs or excise or any 
        other law enforcement officer, if the property was seized for 
        the purpose of forfeiture under any provision of Federal law 
        (other than the Tariff Act of 1930 or the Internal Revenue Code 
        of 1986) providing for the forfeiture of property other than as 
        a sentence imposed upon conviction of a criminal offense but 
        the interest of the claimant is not forfeited''.
    (b) Department of Justice.--
            (1) In general.--With respect to a claim that cannot be 
        settled under chapter 171 of title 28, United States Code, the 
        Attorney General may settle, for not more than $50,000 in any 
        case, a claim for damage to, or loss of, privately owned 
        property caused by an investigative or law enforcement officer 
        (as defined in section 2680(h) of title 28, United States Code) 
        who is employed by the Department of Justice acting within the 
        scope of his or her employment.
            (2) Limitations.--The Attorney General may not pay a claim 
        under paragraph (1) that--
                    (A) is presented to the Attorney General more than 
                1 year after it occurs; or
                    (B) is presented by an officer or employee of the 
                United States Government and arose within the scope of 
                employment.

SEC. 4. PRE-JUDGMENT AND POST-JUDGMENT INTEREST.

    Section 2465 of title 28, United States Code, is amended--
            (1) by inserting ``(a)'' before ``Upon''; and
            (2) adding at the end the following:
    ``(b) Interest.--
            ``(1) Post-judgment.--Upon entry of judgment for the 
        claimant in any proceeding to condemn or forfeit property 
        seized or arrested under any provision of Federal law (other 
        than the Tariff Act of 1930 or the Internal Revenue Code of 
        1986) providing for the forfeiture of property other than as a 
        sentence imposed upon conviction of a criminal offense, the 
        United States shall be liable for post-judgment interest as set 
        forth in section 1961 of this title.
            ``(2) Pre-judgment.--The United States shall not be liable 
        for pre-judgment interest in a proceeding under any provision 
        of Federal law (other than the Tariff Act of 1930 or the 
        Internal Revenue Code of 1986) providing for the forfeiture of 
        property other than as a sentence imposed upon conviction of a 
        criminal offense, except that in cases involving currency, 
        other negotiable instruments, or the proceeds of an 
        interlocutory sale, the United States shall disgorge to the 
        claimant any funds representing--
                    ``(A) interest actually paid to the United States 
                from the date of seizure or arrest of the property that 
                resulted from the investment of the property in an 
                interest-bearing account or instrument; and
                    ``(B) for any period during which no interest is 
                actually paid, an imputed amount of interest that such 
                currency, instruments, or proceeds would have earned at 
                the rate described in section 1961.
            ``(3) Limitation on other payments.--The United States 
        shall not be required to disgorge the value of any intangible 
        benefits in a proceeding under any provision of Federal law 
        (than the Tariff Act of 1930 or the Internal Revenue Code of 
        1986) providing for the forfeiture of property other than as a 
        sentence imposed upon conviction of a criminal offense nor make 
        any other payments to the claimant not specifically authorized 
        by this subsection.''.

SEC. 5. APPLICABILITY.

    (a) In General.--Unless otherwise specified in this Act, the 
amendments made by this Act apply with respect to claims, suits, and 
actions filed on or after the date of the enactment of this Act.
    (b) Exceptions.--
            (1) The standard for the required burden of proof set forth 
        in section 981 of title 18, United States Code, as amended by 
        section 2, shall apply in cases pending on the date of the 
        enactment of this Act.
            (2) The amendment made by section 4 shall apply to any 
        judgment entered after the date of the enactment of this Act.

            Passed the House of Representatives June 24, 1999.

            Attest:

                                            MARTHA C. MORRISON,

                                                          Deputy Clerk.