[Congressional Record (Bound Edition), Volume 156 (2010), Part 13]
[Senate]
[Pages 19164-19165]
[From the U.S. Government Publishing Office, www.gpo.gov]




             PRESERVING CRIMINAL ASSETS FOR FORFEITURE ACT

  Mr. WHITEHOUSE. Mr. President, I rise to speak in support of S. 4005, 
the Preserving Criminal Assets for Forfeiture Act of 2010, which I 
recently introduced with my distinguished colleague Senator Cornyn. 
This bill will help keep the proceeds and instrumentalities of crime 
out of the hands of foreign criminals. It will also encourage foreign 
countries to assist the United States in recovering the overseas assets 
of U.S. criminals.
  The U.S. Government is currently authorized to assist foreign nations 
seeking to enforce their forfeiture judgments, for example by seizing 
the proceeds of large-scale international fraud, drug trafficking, or 
money laundering. Recent judicial decisions, however, have interpreted 
existing statutes as not providing our courts with the authority to 
restrain known criminal assets located in the U.S. prior to the 
issuance of a foreign forfeiture judgment. Criminals are therefore able 
to move and hide the assets they hold in the United States as soon as 
they find out they will be subject to foreign forfeiture proceedings, 
or even while the proceedings are ongoing. This leaves U.S. courts with 
no property to freeze once the foreign forfeiture judgment is entered.
  Because of this hole in the law, foreign criminals have already been 
able to shield hundreds of millions of dollars worth of ill-gotten 
property, allowing them to continue their criminal enterprises and 
frustrating the efforts of law enforcement. In recent months alone, our 
government has been unable to restrain more than $550 million that

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had been identified for forfeiture by foreign governments in connection 
with criminal investigations and prosecutions. This money will remain a 
continuing resource for criminal organizations, allowing them to fund 
extensive additional criminal activity, some of which may well target 
Americans.
  The U.S. Government's lack of authority to preserve criminal assets 
in advance of a foreign forfeiture judgment also threatens the 
cooperation we receive from foreign nations in our own criminal cases. 
The United States regularly seeks our allies' assistance in issuing 
prejudgment restraints to preserve the ill-gotten assets of U.S. 
criminals who have hidden their proceeds overseas. For example, in 
April of this year, Panama repatriated approximately $40 million in 
gold and jewelry from a drug money laundering case, which had been 
restrained there for years at our request. The forfeited assets will be 
liquidated, with the final proceeds from those sales placed into the 
Department of Justice's assets forfeiture fund, and used to enhance 
future domestic and international criminal investigations and law 
enforcement initiatives. As another example, in the major international 
fraud case involving Allen Stanford, Switzerland, the United Kingdom, 
and Canada have restrained a combined $400 million on behalf of the 
United States pursuant to our forfeiture proceedings.
  Comparable future forfeitures could be in jeopardy because, before 
executing a request from the United States, most countries require 
assurances of reciprocity. In fact, a number of these reciprocity 
agreements are codified in treaties. If we fail to provide our 
government with authority to restrain assets pending foreign forfeiture 
judgments, we may ultimately enable criminal organizations in the 
United States to dissipate foreign assets that should be subject to 
U.S. forfeiture proceedings. That puts at risk hundreds of millions of 
dollars in criminal proceeds that may not be able to be returned to 
fraud victims or that criminals will reinvest in drug trafficking 
offenses or other crimes that affect our communities.
  The bipartisan Preserving Criminal Assets for Forfeiture Act of 2010 
will fix these problems by preventing criminals from removing illicit 
assets from the United States during the pendency of foreign forfeiture 
proceedings. The bill would amend 28 U.S.C. Sec.  4267(d)(3) to clarify 
that U.S. courts have the power to issue restraining orders freezing 
the proceeds and instrumentalities of foreign criminals until foreign 
forfeiture proceedings have concluded. In doing so, the legislation 
brings the treatment of international criminals' assets in line with 
that of domestic criminals.
  The bill includes due process protections analogous to those used for 
restraining orders in anticipation of domestic forfeiture judgments, to 
make sure that only criminal assets are targeted. It also requires the 
U.S. court to ensure that the relevant foreign tribunal observes due 
process protections, has subject matter jurisdiction, and is not acting 
as a result of fraud.
  The bill is supported by the Department of Justice, and I thank the 
attorneys of the Department for their expert advice on this 
legislation. I also particularly thank Senator Cornyn for his 
leadership on this issue. It has been a great pleasure to work with him 
in introducing this legislation. I urge our colleagues on both sides of 
the aisle to join with us to enact this much needed bill into law.

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