[Congressional Record (Bound Edition), Volume 145 (1999), Part 10]
[House]
[Pages 13887-13892]
[From the U.S. Government Publishing Office, www.gpo.gov]



                               AMENDMENTS

  Under clause 8 of rule XVIII, proposed amendments were submitted as 
follows:

                               H.R. 1658

                         Offered By: Mr. Gilman

       Amendment No. 1: Page 6, line 5 insert before the semicolon 
     the following:

     ``, was not willfully blind to such conduct, and did not 
     demonstrate a deliberate indifference to such conduct''.

                               H.R. 1658

                         Offered By: Mr. Gilman

       Amendment No. 2: Page 6, line 5 insert before the semicolon 
     the following:

     ``, was not willfully blind to such conduct, or did not 
     consent or was not privy to such conduct''.

                               H.R. 1658

                         Offered By: Mr. Gilman

       Amendment No. 3: Page 15, insert after line 8 the 
     following:

     SEC. 7. CIVIL FORFEITURE FOR PASSPORT AND VISA RELATED 
                   OFFENSES.

       Section 981 of title 18, United States Code, is amended--
       (1) in subsection (a)(1), by inserting after subparagraph 
     (F) the following:
       ``(G) Any property, real of personal--
       ``(i) used, or intended to be used, in committing or 
     facilitating the commission of, or
       ``(ii) constituting, derived from, or traceable to any 
     proceeds obtained, directly or indirectly, from,

     an offense or conspiracy to commit an offense under section 
     1541, 1542, 1543, 1544, or 1546 of this title of an offense, 
     or conspiracy to commit an offense under section 1028 of this 
     title, if either conspiracy or offense was committed in 
     connection with passport or visa issuance.''; and
       (2) in subsection (b)(1)--
       ``(C) subject to forfeiture to the United States under 
     subsection (a)(1)(G) of this section in a case investigated 
     by the Secretary of State may be seized by the Secretary of 
     State.'';
       (3) by striking ``the Attorney General, the Secretary of 
     the Treasury, or the Postal Service'' each place it appears 
     (other than in subsection (b)(1)(C)) and inserting ``the 
     Attorney General, the Secretary of the Treasury, the Postal 
     Service, or the Secretary of State'';
       (4) in subsection (i), by striking ``the Attorney General 
     or the Secretary of the Treasury'' each place it appears and 
     inserting ``Attorney General, Secretary of the Treasury, or 
     the Secretary of State;
       (5) in subsection (j)--
       (A) by striking ``and'' at the end of subparagraph (A);
       (B) by striking the period at the end of subparagraph (B) 
     and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(3) the term `Secretary of State' means the Secretary of 
     State or the Secretary's delegate.''; and
       (6) by adding after subsection (j) the following:
       ``(k) Notwithstanding any other provision of law, at the 
     discretion of the Secretary of State and the Attorney 
     General, property forfeited pursuant to a law enforced or 
     administered by a Department of State law enforcement 
     component may be deemed forfeited pursuant to a law enforced 
     or administered by a Department of Justice law enforcement 
     component.''.

                               H.R. 1658

                       Offered By: Mr. Hutchinson

       Amendment No. 4: Page 2, line 12, strike ``(A)''.

       Page 3, strike lines 1 through 8.

       Page 15, insert after line 8 the following:

     SEC. 7. CHALLENGES TO ADMINISTRATIVE FORFEITURES.

       Section 981 of title 18, United States Code, is amended by 
     adding at the end the following:
       ``(l) Challenges to Administrative Forfeitures.--
       (1) Any motion to set aside a declaration of forfeiture 
     entered pursuant to section 609 of the Tariff Act of 1930 (19 
     U.S.C. 1609), as incorporated by subsection (d), must be 
     filed not later than 2 years after the entry of the 
     declaration of forfeiture. Such motion shall be granted if--
       ``(A) the moving party had an ownership or possessory 
     interest in the forfeited property,

[[Page 13888]]

     and the Government failed to take reasonable steps to provide 
     such party with notice of the forfeiture; and
       ``(B) the moving party did not have actual notice of the 
     seizure within sufficient time to file a claim within the 
     time period provided by law.
       ``(2) If the court grants a motion made under paragraph 
     (1), it shall set aside the declaration of forfeiture as to 
     the moving party's interest pending forfeiture proceedings in 
     accordance with section 602 et seq. of the Tariff Act of 1930 
     (19 U.S.C. 1602 et seq.), which proceedings shall be 
     instituted within 60 days of the entry of the order granting 
     the motion.
       ``(3) If, at the time a motion made under this paragraph 
     (1) is granted, the forfeited property has been disposed of 
     by the Government in accordance with law, the Government 
     shall institute forfeiture proceedings under paragraph (2) 
     against a substitute sum of money equal to the value of the 
     forfeited property at the time it was disposed of, plus 
     interest.
       ``(4) The institution of forfeiture proceedings under 
     paragraph (2) shall not be barred by the expiration of the 
     statute of limitations under section 621 of the Tariff Act of 
     1930 (19 U.S.C. 1621) if the original publication of notice 
     was initiated before the expiration of such limitations 
     period.
       ``(5) A motion made under this subsection shall be the 
     exclusive means of obtaining judicial review of a declaration 
     of forfeiture entered by a seizing agency.
       ``(6) This subsection shall apply to any administrative 
     forfeiture under this section, and to any administrative 
     forfeiture under the Controlled Substances Act, or under any 
     other provision of law that incorporates the provisions of 
     the customs laws.''

                               H.R. 1658

                       Offered By: Mr. Hutchinson

       Amendment No. 5: Page 4, strike line 23 and all that 
     follows through line 16 on page 5 and redesignate paragraphs 
     (5), (6), (7), and (8) as paragraphs (4), (5), (6), and (7), 
     respectively.

                               H.R. 1658

                       Offered By: Mr. Hutchinson

       Amendment No. 6: Page 5, line 20, strike ``by clear and 
     convincing evidence'' and insert ``by a preponderance of the 
     evidence''.

                               H.R. 1658

                       Offered By: Mr. Hutchinson

       Amendment No. 7: Page 5, strike line 22 and all that 
     follows through line 5 on page 9.
       Page 15, after line 8 insert the following:

     SEC. 7. INNOCENT OWNER DEFENSE.

       (a) In General.--Chapter 46 of title 18, United States 
     Code, is amended by inserting after section 982 the 
     following:

     ``Sec. 983. Innocent owners

       ``(a) An innocent owner's interest in property shall be 
     forfeited in any judicial action under any civil forfeiture 
     provision of this title, the Controlled Substances Act, or 
     the Immigration and Naturalization Act of 1952.
       ``(b)(1) With respect to a property interest in existence 
     at the time the illegal act giving rise to forfeiture took 
     place, a person is an innocent owner if the person 
     establishes, by a preponderance of the evidence--
       ``(A) that the person did not know that the property was 
     being used or was likely to be used in the commission of such 
     illegal act, or
       ``(B) that upon learning that the property was being used 
     or was likely to be used in the commission of such illegal 
     act, the person promptly did all that reasonably could be 
     expected to terminate or to prevent such use of the property.
       ``(2) With respect to a property interest acquired after 
     the act, giving rise to the forfeiture, took place, a person 
     is an innocent owner if the person establishes, by a 
     preponderance of the evidence, that the person acquired the 
     property as a bona fide purchaser for value who at the time 
     of the purchase did not know and was reasonably without cause 
     to believe that the property was subject to forfeiture. A 
     purchaser is `reasonably without cause to believe that the 
     property was subject to forfeiture' if, in light of the 
     circumstances, the purchaser did all that reasonably could be 
     expected to ensure that he or she was not acquiring property 
     that was subject to forfeiture.
       ``(3) Notwithstanding any provision of this section, no 
     person may assert an ownership interest under this section in 
     contraband or other property that it is illegal to possess. 
     In addition, except as set forth in paragraph (2), no person 
     may assert an ownership interest under this section in the 
     illegal proceeds of a criminal act, irrespective of State 
     property law.
       ``(c) For the purposes of this section--
       ``(1) an `owner' is a person with an ownership interest in 
     the specific property sought to be forfeited, including but 
     not limited to a lien, mortgage, recorded security device or 
     valid assignment of an ownership interest. An owner does not 
     include--
       ``(A) a person with only a general unsecured interest in, 
     or claim against, the property or estate of another person;
       ``(B) a bailee, unless the bailor is identified, and the 
     bailor has authorized the bailee to claim in the forfeiture 
     proceeding, pursuant to the Supplemental Rules for Admirality 
     and Maritime Claims;
       ``(C) a nominee who exercises no dominion or control over 
     the property; or
       ``(D) a beneficiary of a constructive trust; and
       ``(2) a person shall be considered to have known that his 
     or her property was being used or was likely to be used in 
     the commission of an illegal act if the government 
     establishes the existence of facts and circumstances that 
     should have created a reasonable suspicion that the property 
     was being or would be used for an illegal purpose.
       ``(d) If the court determines, in accordance with this 
     section, that an innocent owner has a partial interest in 
     property otherwise subject to forfeiture, or a joint tenancy 
     or tenancy by the entirety in such property, the court shall 
     enter an appropriate order--
       ``(1) serving the property;
       ``(2) transferring the property to the government with a 
     provision that the government compensate the innocent owner 
     to the extent of his or her ownership interest once a final 
     order of forfeiture has been entered and the property has 
     been reduced to liquid assets, or if neither (1) or (2) is 
     reasonably practical under all of the circumstances; and
       ``(3) permitting the innocent owner to retain the property 
     subject to a lien in favor of the government to the extent of 
     the forfeitable interest in the property. To effectuate the 
     purposes of this subsection, a joint tenancy or tenancy by 
     the entireties shall be converted to a tenancy in common by 
     order of the court, irrespective of State law.''.

                               H.R. 1658

                       Offered By: Mr. Hutchinson

       Amendment No. 8: Page 9, strike line 6 and all that follows 
     through line 2 on page 11.
       Page 15, insert after line 8 the following:

     SEC. 7. RETURN OF SEIZED PROPERTY.

       Section 981 of title 18, United States Code, is amended by 
     adding the following at the end:
       ``(k)(1) Suppression of Evidence.--A party with standing to 
     challenge a seizure and forfeiture under this section may 
     move to suppress the use of the property as evidence on the 
     ground that the Government lacked probable cause at the time 
     of the seizure. Suppression of the property as evidence shall 
     not affect the right of the Government to proceed with a 
     forfeiture action based on independently derived evidence.
       ``(2) Return of Seized Property.--A person with standing to 
     challenge the forfeiture of property seized under this 
     section may file a motion for the return of the property in 
     the manner described in Rule 41(e), Federal Rule of Criminal 
     Procedure. If such motion is filed, the court shall conduct a 
     hearing within 90 days and shall order the release of the 
     property, pending trial on the forfeiture and the entry of 
     judgment, unless--
       ``(A) the Government establishes probable cause to believe 
     that the property is subject to forfeiture, based on all 
     information available to the Government at the time of the 
     hearing;
       ``(B) the Government has filed a civil forfeiture complaint 
     against the property, and a magistrate judge has determined 
     there is probable cause for the issuance of a warrant of 
     arrest in rem pursuant to the Supplemental Rules for 
     Admiralty and Maritime Claims;
       ``(C) a grand jury has returned an indictment that includes 
     an allegation that the property is subject to criminal 
     forfeiture;
       ``(D) the person filing the motion had notice of the 
     Government's intent to forfeit the property administratively 
     pursuant to 19 U.S.C. 1608, and failed to file a claim to the 
     property within the specified time period;
       ``(E) the property is contraband or other property that the 
     moving party may not legally possess; or
       ``(F) the property is needed as evidence in a criminal 
     investigation or prosecution.''.
       ``(3) Complaint; Motion To Dismiss.--A party with standing 
     to challenge a forfeiture under this section may move to 
     dismiss the complaint for failure to comply with Rule E(2) of 
     the Supplemental Rules, or on any other ground set forth in 
     Rule 12(b) of the Federal Rules of Civil Procedure. 
     Notwithstanding the provision of section 615 of the Tariff 
     Act of 1930 (19 U.S.C. 1615), a party may not move to dismiss 
     the complaint on the ground that the evidence in the 
     possession of the Government at the time it filed its 
     complaint was insufficient to establish the forfeitability of 
     the property.

                               H.R. 1658

                       Offered By: Mr. Hutchinson

       Amendment No. 9: Page 14, strike line 20 and all that 
     follows through line 8 on page 15.
       Page 15, insert after line 8 the following:

     SEC. 6. APPLICABILITY.

       (a) In General.--Unless otherwise specified in this Act, 
     the amendments made by this Act apply to forfeiture 
     proceedings commenced on or after the date of the enactment 
     of this Act.
       (b) Administrative Forfeitures.--The amendments in this Act 
     relating to seizures and administrative forfeitures shall 
     apply to seizures and forfeitures occurring on or after the 
     60th day after the date of the enactment of this Act.
       (c) Civil Judicial Forfeitures.--The amendments in this Act 
     relating to judicial

[[Page 13889]]

     procedures applicable once a civil forfeiture complaint is 
     filed by the Government shall apply to all cases in which the 
     forfeiture complaint is filed on or after the date of the 
     enactment of this Act.

                               H.R. 1658

                       Offered By: Mr. Hutchinson

       Amendment No. 10: Page 15, insert after line 8 the 
     following:

     SEC. 8. FUGITIVE DISENTITLEMENT.

       (a) In General.--Chapter 163 of title 28, United States 
     Code, is amended by inserting the following at the end.

     ``Sec. 2467. Fugitive disentitlement

       ``Any person who, in order to avoid criminal prosecution, 
     purposely leaves the jurisdiction of the United States, 
     declines to enter or re-enter the United States to submit to 
     its jurisdiction, or otherwise evades the jurisdiction of the 
     court where a criminal case is pending against the person, 
     may not use the resources of the courts of the United States 
     in furtherance of a claim in any related civil forfeiture 
     action.''
       (b) Conforming Amendment.--The chapter analysis for chapter 
     163 of title 28, United States Code, is amended by inserting 
     the following at the end:

``2467. Fugitive disentitlement''.

                               H.R. 1658

                       Offered By: Mr. Hutchinson

               [Amendment in the Nature of a Substitute]

       Amendment No. 11: Strike all after the enacting clause and 
     insert the following:

     SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Civil 
     Asset Forfeiture Reform Act''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title and table of contents.
Sec. 2. Creation of general rules relating to civil forfeiture 
              proceedings.
Sec. 3. Compensation for damage to seized property.
Sec. 4. Prejudgment and postjudgment interest.

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

       (a) In General.--Chapter 46 of title 18, United States 
     Code, is amended by inserting the following new section after 
     section 982:

     ``Sec. 983. Civil forfeiture procedures

       ``(a) Administrative Forfeitures.--(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 send written notice of 
     the seizure under section 607(a) of the Tariff Act of 1930 
     (19 U.S.C. 1607(a)), such notice together with information on 
     the applicable procedures shall be sent not later than 60 
     days after the seizure to each party known to the seizing 
     agency at the time of the seizure to have an ownership or 
     possessory interest, including a lienholder's interest, in 
     the seized article. If a party's identity or interest is not 
     determined until after the seizure but is determined before a 
     declaration of forfeiture is entered, such written notice and 
     information shall be sent to such interested party not later 
     than 60 days after the seizing agency's determination of the 
     identity of the party or the party's interest.
       ``(B) If the Government does not provide notice of a 
     seizure of property in accordance with subparagraph (A), it 
     shall return the property pending the giving of such notice.
       ``(2) The Government may apply to a Federal magistrate 
     judge (as defined in the Federal Rules of Criminal Procedure) 
     in any district where venue for a forfeiture action would lie 
     under section 1355(b) of title 28 for an extension of time in 
     which to comply with paragraph (1)(A). Such an extension 
     shall be granted based on a showing of good cause.
       ``(3) A person with an ownership or possessory interest in 
     the seized article who failed to file a claim within the time 
     period prescribed in subsection (b) may, on motion made not 
     later than 2 years after the date of final publication of 
     notice of seizure of the property, move to set aside a 
     declaration of forfeiture entered pursuant to section 609 of 
     the Tariff Act of 1930 (19 U.S.C. 1609). Such motion shall be 
     granted if--
       ``(A) the Government failed to take reasonable steps to 
     provide the claimant with notice of the forfeiture; and
       ``(B) the person otherwise had no actual notice of the 
     seizure within sufficient time to enable the person to file a 
     timely claim under subsection (b).
       ``(4) If the court grants a motion made under paragraph 
     (3), it shall set aside the declaration of forfeiture as to 
     the moving party's interest pending forfeiture proceedings in 
     accordance with section 602 et seq. of the Tariff Act of 1930 
     (19 U.S.C. 1602 et seq.), which proceedings shall be 
     instituted within 60 days of the entry of the order granting 
     the motion.
       ``(5) If, at the time a motion under this subsection is 
     granted, the forfeited property has been disposed of by the 
     Government in accordance with law, the Government shall 
     institute forfeiture proceedings under paragraph (4). The 
     property which will be the subject of the forfeiture 
     proceedings instituted under paragraph (4) shall be a sum of 
     money equal to the value of the forfeited property at the 
     time it was disposed of plus interest.
       ``(6) The institution of forfeiture proceedings under 
     paragraph (4) shall not be barred by the expiration of the 
     statute of limitations under section 621 of the Tariff Act of 
     1930 (19 U.S.C. 1621) if the original publication of notice 
     was completed before the expiration of such limitations 
     period.
       ``(7) A motion made under this subsection shall be the 
     exclusive means of obtaining judicial review of a declaration 
     of forfeiture entered by a seizing agency.
       ``(b) Filing a Claim.--(1) Any person claiming such seized 
     property may file a claim with the appropriate official after 
     the seizure.
       ``(2) A claim under paragraph (1) may not be filed later 
     than 30 days after--
       ``(A) the date of final publication of notice of seizure; 
     or
       ``(B) in the case of a person receiving written notice, the 
     date that such notice is received.
       ``(3) The claim shall set forth the nature and extent of 
     the claimant's interest in the property.
       ``(c) Filing a Complaint.--(1) In cases where property has 
     been seized or restrained by the Government and a claim has 
     been filed, the Attorney General shall file a complaint for 
     forfeiture in the appropriate court in the manner set forth 
     in the Supplemental Rules for Certain Admiralty and Maritime 
     Claims not later than 90 days after the claim was filed, or 
     return the property pending the filing of a complaint. By 
     mutual agreement between the Government and the claimants, 
     the 90-day filing requirement may be waived.
       ``(2) The Government may apply to a Federal magistrate 
     judge (as defined in the Federal Rules of Criminal Procedure) 
     in any district where venue for a forfeiture action would lie 
     under section 1355(b) of title 28 for an extension of time in 
     which to comply with paragraph (1). Such an extension shall 
     be granted based on a showing of good cause.
       ``(3) Upon the filing of a civil complaint, the claimant 
     shall file a claim and answer in accordance with the 
     Supplemental Rules for Certain Admiralty and Maritime Claims.
       ``(d) Appointment of Counsel.--(1) If the person filing a 
     claim is financially unable to obtain representation by 
     counsel and requests that counsel be appointed, the court may 
     appoint counsel to represent that person with respect to the 
     claim. In determining whether to appoint counsel to represent 
     the person filing the claim, the court shall take into 
     account--
       ``(A) the nature and value of the property subject to 
     forfeiture, including the hardship to the claimant from the 
     loss of the property seized, compared to the expense of 
     appointing counsel;
       ``(B) the claimant's standing to contest the forfeiture; 
     and
       ``(C) whether the claim appears to be made in good faith or 
     to be frivolous.
       ``(2) The court shall set the compensation for that 
     representation, which shall be the 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.
       ``(3) The determination of whether to appoint counsel under 
     this subsection shall be made following a hearing at which 
     the Government shall have an opportunity to present evidence 
     and examine the claimant. The testimony of the claimant at 
     such hearing shall not be admitted in any other proceeding 
     except in accordance with the rules which govern the 
     admissibility of testimony adduced in a hearing on a motion 
     to suppress evidence. Nothing in this paragraph shall be 
     construed to prohibit the admission of any evidence that may 
     be obtained in the course of civil discovery in the 
     forfeiture proceeding or through any other lawful 
     investigative means.
       ``(e) Burden of Proof.--In all suits or actions brought for 
     the civil forfeiture of any property, the burden of proof at 
     trial is on the United States to establish, by a 
     preponderance of the evidence, that the property is subject 
     to forfeiture. If the Government proves that the property is 
     subject to forfeiture, the claimant shall have the burden of 
     establishing any affirmative defense by a preponderance of 
     the evidence.
       ``(f) Innocent Owners.--(1) An innocent owner's interest in 
     property shall not be forfeited in any civil forfeiture 
     action.
       ``(2) With respect to a property interest in existence at 
     the time the illegal conduct giving rise to the forfeiture 
     took place, the term `innocent owner' means an owner who--
       ``(A) did not know of the conduct giving rise to the 
     forfeiture; or
       ``(B) 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.
       ``(3)(A) 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 a bona 
     fide purchaser for value and was at the time of the purchase 
     reasonably without cause to believe that the property was 
     subject to forfeiture.

[[Page 13890]]

       ``(B) Except as provided in paragraph (4), where the 
     property subject to forfeiture is real property, and the 
     claimant uses the property as his or her 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 (A), 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, and was an owner of the 
     property, as defined in paragraph (6).
       ``(4) Notwithstanding any provision of this section, no 
     person may assert an ownership interest under this section--
       ``(A) in contraband or other property that it is illegal to 
     possess; or
       ``(B) in the illegal proceeds of a criminal act unless such 
     person was a bona fide purchaser for value who was reasonably 
     without cause to believe that the property was subject to 
     forfeiture.
       ``(5) For the purposes of paragraph (2) of this subsection 
     a person does all that reasonably can be expected if the 
     person takes all steps that a reasonable person would take in 
     the circumstances to prevent or terminate the illegal use of 
     the person's property. There is a rebuttable presumption that 
     a property owner took all the steps that a reasonable person 
     would take if the property owner--
       ``(A) gave timely notice to an appropriate law enforcement 
     agency of information that led to the claimant to know the 
     conduct giving rise to a forfeiture would occur or has 
     occurred; and
       ``(B) in a timely fashion, revoked permission for those 
     engaging in such conduct to use the property or took 
     reasonable steps in consultation with a law enforcement 
     agency to discourage or prevent the illegal use of the 
     property.

     The person is not required to take extraordinary steps that 
     the person reasonably believes would be likely to subject the 
     person to physical danger.
       ``(6) As used in this subsection--
       ``(A) 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.
       ``(B) the term `owner' means a person with an ownership 
     interest in the specific property sought to be forfeited, 
     including a 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;
       ``(C) a person shall be considered to have known that the 
     person's property was being used or was likely to be used in 
     the commission of an illegal act if the person was willfully 
     blind.
       ``(7) If the court determines, in accordance with this 
     subsection, that an innocent owner had a partial interest in 
     property otherwise subject to forfeiture, or a joint tenancy 
     or tenancy by the entirety in such property, the court shall 
     enter an appropriate order--
       ``(A) severing the property;
       ``(B) transferring the property to the Government with a 
     provision that the Government compensate the innocent owner 
     to the extent of his or her ownership interest once a final 
     order of forfeiture has been entered and the property has 
     been reduced to liquid assets; or
       ``(C) permitting the innocent owner to retain the property 
     subject to a lien in favor of the Government, to the extent 
     of the forfeitable interest in the property, that will permit 
     the Government to realize its forfeitable interest if the 
     property is transferred to another person.

     To effectuate the purposes of this subsection, a joint 
     tenancy or tenancy by the entireties shall be converted to a 
     tenancy in common by order of the court, irrespective of 
     state law.
       ``(8) An innocent owner defense under this subsection is an 
     affirmative defense.
       ``(g) Motion To Suppress Seized Evidence.--At any time 
     after a claim and answer are filed in a judicial forfeiture 
     proceeding, a claimant with standing to contest the seizure 
     of the property may move to suppress the fruits of the 
     seizure in accordance with the normal rules regarding the 
     suppression of illegally seized evidence. If the claimant 
     prevails on such motion, the fruits of the seizure shall not 
     be admitted into evidence as to that claimant at the 
     forfeiture trial. However, a finding that evidence should be 
     suppressed shall not bar the forfeiture of the property based 
     on evidence obtained independently before or after the 
     seizure.
       ``(h) Use of Hearsay at Pre-Trial Hearings.--At any pre-
     trial hearing under this section in which the governing 
     standard is probable cause, the court may accept and consider 
     hearsay otherwise inadmissible under the Federal Rules of 
     Evidence.
       ``(i) Stipulations.--Notwithstanding the claimant's offer 
     to stipulate to the forfeitability of the property, the 
     Government shall be entitled to present evidence to the 
     finder of fact on that issue before the claimant presents any 
     evidence in support of any affirmative defense.
       ``(j) Preservation of Property Subject to Forfeiture.--The 
     court, before or after the filing of a forfeiture complaint 
     and on the application of the Government, may--
       ``(1) enter any restraining order or injunction in the 
     manner set forth in section 413(e) of the Controlled 
     Substances Act (21 U.S.C. 853(e));
       ``(2) require the execution of satisfactory performance 
     bonds;
       ``(3) create receiverships;
       ``(4) appoint conservators, custodians, appraisers, 
     accountants or trustees; or
       ``(5) take any other action to seize, secure, maintain, or 
     preserve the availability of property subject to forfeiture 
     under this section.
       ``(k) Excessive Fines.--(1) At the conclusion of the trial 
     and following the entry of a verdict of forfeiture, or upon 
     the entry of summary judgment for the Government as to the 
     forfeitability of the property, the claimant may petition the 
     court to determine whether the excessive fines clause of the 
     Eighth Amendment applies, and if so, whether forfeiture is 
     excessive. The claimant shall have the burden of establishing 
     that a forfeiture is excessive by a preponderance of the 
     evidence at a hearing conducted in the manner provided in 
     Rule 43(e), Federal Rules of Civil Procedure, by the Court 
     without a jury. If the court determines that the forfeiture 
     is excessive, it shall adjust the forfeiture to the extent 
     necessary to avoid the Constitutional violation.
       ``(2) The claimant may not object to the forfeiture on 
     Eighth Amendment grounds other than as set forth in paragraph 
     (1), except that a claimant may, at any time, file a motion 
     for summary judgment asserting that even if the property is 
     subject to forfeiture, the forfeiture would be excessive. The 
     court shall rule on such motion for summary judgment only 
     after the Government has had an opportunity--
       ``(A) to conduct full discovery on the Eighth Amendment 
     issue; and
       ``(B) to place such evidence as may be relevant to the 
     excessive fines determination before the court in affidavits 
     or at an evidentiary hearing.
       ``(l) Pre-Discovery Standard.--In a judicial proceeding on 
     the forfeiture of property, the Government shall not be 
     required to establish the forfeitability of the property 
     before the completion of discovery pursuant to the Federal 
     Rules of Civil Procedure, particularly Rule 56(f) as may be 
     ordered by the court or if no discovery is ordered before 
     trial.
       ``(m) Applicability.--The procedures set forth in this 
     section apply to any civil forfeiture action brought under 
     any provision of this title, the Controlled Substances Act, 
     or the Immigration and Naturalization Act.''.
       (b) Release of Property.--Chapter 46 of title 18, United 
     States Code, is amended to add the following section after 
     section 984:

     ``Sec. 985. Release of property to avoid hardship

       ``(a) A person who has filed a claim under section 983 is 
     entitled to release pursuant to subsection (b) of seized 
     property pending trial if--
       ``(1) the claimant has a possessory interest in the 
     property sufficient to establish standing to contest 
     forfeiture and has filed a nonfrivolous claim on the merits 
     of the forfeiture action;
       ``(2) the claimant has sufficient ties to the community to 
     provide assurance that the property will be available at the 
     time of the trial;
       ``(3) 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 claimant from working, leaving the 
     claimant homeless, or preventing the functioning of a 
     business;
       ``(4) the claimant's hardship outweighs the risk that the 
     property will be destroyed, damaged, lost, concealed, 
     diminished in value or transferred if it is returned to the 
     claimant during the pendency of the proceeding; and
       ``(5) none of the conditions set forth in subsection (c) 
     applies;
       ``(b)(1) The claimant may make a request for the release of 
     property under this subsection at any time after the claim is 
     filed. If, at the time the request is made, the seizing 
     agency has not yet referred the claim to a United States 
     Attorney pursuant to section 608 of the Tariff Act of 1930 
     (19 U.S.C. 1608), the request may be filed with the seizing 
     agency; otherwise the request must be filed with the United 
     States Attorney to whom the claim was referred. In either 
     case, the request must set forth the basis on which the 
     requirements of subsection (a)(1) are met.
       ``(2) If the seizing agency, or the United States Attorney, 
     as the case may be, denies

[[Page 13891]]

     the request or fails to act on the request within 20 days, 
     the claimant may file the request as a motion for the return 
     of seized property in the district court for the district 
     represented by the United States Attorney to whom the claim 
     was referred, or if the claim has not yet been referred, in 
     the district court that issued the seizure warrant for the 
     property, or if no warrant was issued, in any district court 
     that would have jurisdiction to consider a motion for the 
     return of seized property under Rule 41(e), Federal Rules of 
     Criminal Procedure. The motion must set forth the basis on 
     which the requirements of subsection (a) have been met and 
     the steps the claimant has taken to secure the release of the 
     property from the appropriate official.
       ``(3) The district court must act on a motion made pursuant 
     to this subsection within 30 days or as soon thereafter as 
     practicable, and must grant the motion if the claimant 
     establishes that the requirements of subsection (a) have been 
     met. If the court grants the motion, the court must enter any 
     order necessary to ensure that the value of the property is 
     maintained while the forfeiture action is pending, including 
     permitting the inspection, photographing and inventory of the 
     property, and the court may take action in accordance with 
     Rule E of the Supplemental Rules for Certain Admiralty and 
     Maritime Cases. The Government is authorized to place a lien 
     against the property or to file a lis pendens to ensure that 
     it is not transferred to another person.
       ``(4) If property returned to the claimant under this 
     section is lost, stolen, or diminished in value, any 
     insurance proceeds shall be paid to the United States and 
     such proceeds shall be subject to forfeiture in place of the 
     property originally seized.
       ``(c) This section shall not apply if the seized property--
       ``(1) is contraband, currency or other monetary instrument, 
     or electronic funds unless such currency or other monetary 
     instrument or electronic funds constitutes the assets of a 
     business which has been seized,
       ``(2) is evidence of a violation of the law,
       ``(3) by reason of design or other characteristic, is 
     particularly suited for use in illegal activities; or
       ``(4) is likely to be used to commit additional criminal 
     acts if returned to the claimant.''
       ``(d) Once a motion for the release of property under this 
     section is filed, the person filing the motion may request 
     that the motion be transferred to another district where 
     venue for the forfeiture action would lie under section 
     1355(b) of title 28 pursuant to the change of venue 
     provisions in section 1404 of title 28.''.
       (c) Chapter Analysis.--The chapter analysis for chapter 46 
     of title 18, United States Code, is amended--
       (1) by inserting after the item relating to section 982 the 
     following:

``983. Civil forfeiture procedures''; and
       (2) by inserting after the item relating to section 984 the 
     following:

``985. Release of property to avoid hardship''.
       (f) Civil Forfeiture of Proceeds.--Section 981(a)(1) of 
     title 18, United States Code, is amended--
       (1) in subparagraph (C) by inserting before the period the 
     following: ``or any offense constituting `specified unlawful 
     activity' as defined in section 1956(c)(7) of this title or a 
     conspiracy to commit such offense''; and
       (2) by striking subparagraph (E).
       (d) Uniform Definition of Proceeds.--Section 981(a) of 
     title 18, United States Code, as amended by subsection (c), 
     is amended--
       (A) in paragraph (1), by striking ``gross receipts'' and 
     ``gross proceeds'' wherever those terms appear and inserting 
     ``proceeds''; and
       (B) by adding the following after paragraph (1):
       ``(2) For purposes of paragraph (1), the term `proceeds' 
     means property of any kind obtained, directly or indirectly, 
     as the result of the commission of the offense giving rise to 
     forfeiture, and any property traceable thereto, and is not 
     limited to the net gain or profit realized from the 
     commission of the offense. In a case involving the forfeiture 
     of proceeds of a fraud or false claim under paragraph (1)(C) 
     involving billing for goods or services part of which are 
     legitimate and part of which are not legitimate, the court 
     shall allow the claimant a deduction from the forfeiture for 
     the amount obtained in exchange for the legitimate goods or 
     services. In a case involving goods or services provided by a 
     health care provider, such goods or services are not 
     `legitimate' if they were unnecessary.
       ``(3) For purposes of the provisions of subparagraphs (B) 
     through (H) of paragraph (1) which provide for the forfeiture 
     of proceeds of an offense or property traceable thereto, 
     where the proceeds have been commingled with or invested in 
     real or personal property, only the portion of such property 
     derived from the proceeds shall be regarded as property 
     traceable to the forfeitable proceeds. Where the proceeds of 
     the offense have been invested in real or personal property 
     that has appreciated in value, whether the relationship of 
     the property to the proceeds is too attenuated to support the 
     forfeiture of such property shall be determined in accordance 
     with the excessive fines clause of the Eighth Amendment.''

     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. PREJUDGMENT AND POSTJUDGMENT 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 prejudgment 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 nor make any other payments to the claimant not 
     specifically authorized by this subsection.''.

                               H.R. 1658

                          Offered By: Mr. Hyde

       Amendment No. 12: Page 8, line 10, redesignate paragraph 
     (8) as paragraph (9), and insert after line 9 the following:
       ``(8) When a State or local law enforcement agency 
     participated directly in the seizure or forfeiture of 
     property forfeited under any civil forfeiture statute, that 
     part of the property to be transferred to any State and local 
     entities shall be distributed according to the rules set 
     forth in that State's law or Constitution as to property 
     forfeited under the State forfeiture law.

                               H.R. 1658

                          Offered By: Mr. Hyde

       Amendment No. 13: Page 11, strike line 3 and all that 
     follows through line 3 on page 12 and redesignate sections 4, 
     5, and 6 as sections 3, 4, and 5, respectively.
       Page 12, line 17, strike ``forfeiture'' and insert 
     ``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''.
       Page 13, beginning in line 20 strike ``under any Act of 
     Congress'' and insert ``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''.
       Page 13, line 25, strike ``pre-judgment interest'' and 
     insert ``pre-judgment interest in a proceeding under any 
     provision of Federal

[[Page 13892]]

     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''.
       Page 14, line 17, strike ``any intangible benefits'' and 
     insert ``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''.

                               H.R. 1658

                    Offered By: Mrs. Meek of Florida

       Amendment No. 14: Page 15, insert after line 8 the 
     following:

     SEC. 7. FORFEITURE FOR ALIEN SMUGGLING.

       Section 981(a)(1) of title 18, United States Code, is 
     amended by adding at the end the following:
       ``(l(1) Any conveyance, including any vessel, vehicle, or 
     aircraft which has been used or is being used in commission 
     of a violation of section 274(a) of the Immigration and 
     Nationality Act (8 U.S.C. 1324(a)); and
       ``(2) Any property, real or personal that--
       ``(A) constitutes, is derived from, or is traceable to the 
     proceeds obtained, directly or indirectly, from the 
     commission of a violation of section 274(a) of the 
     Immigration and Nationality Act (8 U.S.C. 1324(a)); or
       ``(B) is used to facilitate, or is intended to be used to 
     facilitate, the commission of a violation of such section.

                               H.R. 1658

                          Offered By: Mr. Paul

       Amendment No. 15: Strike all after the enacting clause and 
     insert the following:

     SECTION 1. FORFEITURE CONDITION.

       No property may be forfeited under any civil asset 
     forfeiture law unless the property's owner has first been 
     convicted of the criminal offense that makes the property 
     subject to forfeiture. The term ``civil forfeiture law'' 
     refers to 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.

                               H.R. 1658

                        Offered By: Mr. Sweeney

       Amendment No. 16: Page 4, strike lines 9 through 11 and 
     insert the following:
       ``(F) A claim filed under subparagraph (A) shall include 
     the posting of a bond to the United States in the sum of 
     $5,000 or 10 percent of the value of the claimed property, 
     whichever is lower, but not less than $250, with sureties to 
     be approved by the Attorney General. No bond shall be 
     required if the property is seized by the Attorney General 
     and a timely claim is filed in forma pauperis with all 
     supporting information as required by the Attorney General. 
     The Attorney General has the authority to waive or reduce the 
     bond requirement in any additional category of cases where 
     the Attorney General determines that posting bond is not 
     required in the interests of justice.

                               H.R. 1658

                        Offered By: Mr. Sweeney

       Amendment No. 17: Page 6, line 5 insert before the 
     semicolon the following: ``, was not willfully blind to such 
     conduct, and did not demonstrate a deliberate indifference to 
     such conduct''.

                               H.R. 1658

                        Offered By: Mr. Sweeney

       Amendment No. 18: Page 6, strike line 14 and all that 
     follows through page 7, line 13 and insert the following: 
     ``was a bona fide purchaser or seller for value (including a 
     purchaser or seller of goods or services for value).''.

                               H.R. 1658

                        Offered By: Mr. Sweeney

       Amendment No. 19: Page 14, strike line 25 and all that 
     follows through page 15, line 8.

                               H.R. 1658

                        Offered By: Mr. Sweeney

                [Amendment to the Hutchinson Substitute]

       Amendment No. 20: In subsection (b) of the proposed section 
     983 of title 18, United States Code, add at the end the 
     following:
       ``(4) A claim filed under paragraph (1) shall include the 
     posting of a bond to the United States in the sum of $5,000 
     or 10 percent of the value of the claimed property, whichever 
     is lower, but not less than $250, with sureties to be 
     approved by the Attorney General. No bond shall be required 
     if the property is seized by the Attorney General and if the 
     claim is filed in forma pauperis with all supporting 
     information as required by the Attorney General. The Attorney 
     General has the authority to waive or reduce the bond 
     requirement in any additional category of cases where the 
     Attorney General determines that posting bond is not required 
     in the interests of justice.


             CONGRESSIONAL RECORD 

                United States
                 of America



June 22, 1999