From: [c--r--n] at [ux4.cso.uiuc.edu] (Christopher J Burian)
Newsgroups: alt.activism,alt.society.civil-liberty,talk.politics.misc
Subject: Forfeiture alert
Date: 19 Feb 1994 17:34:37 GMT
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Forfeiture Alert
MAKING FALSE STATEMENTS ON MORTGAGE LOAN APPLICATION
TRIGGERS FEDERAL FORFEITURE PROVISIONS
For more information or to help us fight these laws, contact
F.E.A.R.
Forfeiture Endangers American Rights
P.O. Box 5424
Somerset, NJ 08875-5424
[j paff 1] at [genie.geis.com]
Synopsis: On August 20, 1992, the United States District Court for
the Central District of California ordered forfeiture of a
residential property because the owner had made false statements on
a mortgage loan application. Additionally, the court held that the
forfeiture could be applied retroactively. For the full text of
this case, see _U.S. v. 403 1/2 Skyline Dr, La Habra, Heights, CA_
which can be found at any sizable library at 797 F.Supp 796 (i.e.
volume 797 of Federal Supplement, at page 796.
Verbatim quotes from the opinion are in quotation marks.
"On or about July 28, 1986, claimant Anthony Feher, submitted a
residential loan application for a home loan to Great Western
Savings, a federally insured financial institution, to purchase the
defendant property. On this application, Feher represented that he
was employed as an installer for Action Garage Door, in Hacienda
Heights, California. Feher also represented that he had been so
employed for two years, and that his gross monthly income was
approximately $5,500.00."
"On the basis of this application, Feher was granted a loan from
Great Western Savings in the amount of $195,000 to fund the
purchase of the defendant property."
"The government contends that Feher was never employed at Action
Garage Door."
"Section 963(a) of the Financial Institutions Reform, Recovery and
Enforcement Act ("FIRREA") provides for the forfeiture to the
United States of '[a]ny property, real or personal, which
constitutes or is derived from proceeds traceable to a violation of
section . . 1014 of this title.'"
"18 U.S.C. Sec. 1014 prohibits 'knowingly mak[ing] any false
statement . . . for the purpose of influencing in any way the
action of . . . any institution the accounts of which are insured
by the Federal Deposit Insurance Corporation, upon any application
[for a] loan.'"
"As in narcotics forfeiture cases, the government need only to
establish probable cause for the forfeiture pursuant to the
FIRREA." The burden then shifts to the property owner to prove, by
a preponderance of the evidence, that the property is not subject
to forfeiture. Note that the government did not allege, nor does
it need to, that Feher failed to make any of the mortgage payments.
"The Declaration of Tony Marino establishes that between 1984-1986,
Action Garage Door never employed Feher." Tony Marino is the owner
of Action Garage Door.
"Claimant Feher has failed to present any evidence contradicting
these facts. Accordingly, this Court finds that the government has
established probable cause to forfeiture defendant property."
"Claimant Feher made false statements on his loan form on July 28,
1986. FIRREA was enacted in 1989. Because the false statements
occurred prior to FIRREA's enactment, Feher contends that the
retroactive application of FIRREA is improper."
"FIRREA's civil forfeiture provisions do not focus on the
individual but rather on the property."
"This Court finds that such a legislative scheme is remedial in
nature and not substantive." Thus, retroactive application of
FIRREA's forfeiture provisions are proper.
"Accordingly, this Court grants plaintiff United States of
America's Motion for Summary Judgment." Title to property is
forfeited to the United States of America.
Note that the case was decided on the government's motion for
summary judgment. In other words, the case never went to trial.
The judge, named Tevrizian, decided the case on the strength of the
government's affidavits.
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Civil Forfeiture
How it Actually Works
For more information or to help us fight these laws, contact
F.E.A.R.
Forfeiture Endangers American Rights
P.O. Box 5424
Somerset, NJ 08875-5424
[j paff 1] at [genie.geis.com]
The following is based on the case, _U.S. v. One Parcel of Property
Known as 4.14 Acres in the 19th G.M. District of Bryan County,
Georgia_, 801 F.Supp. 737, (S.D. Ga, 1992). This opinion clearly
shows how abusive the federal forfeiture statute is.
Direct quotes from the court are shown in quotation marks. The
non-quoted text are my comments.
This case involves the federal government seeking forfeiture of a
widow's (Easter Mae Jenkins) principal residence due to her
daughters' (Sharon and Jennifer Jenkins) involvement in drug
dealing out of the house.
The facts of the case clearly establish that drug sales were
regularly carried out at the house. The government easily showed
probable cause, which is their burden of proof in a federal
forfeiture case. "The burden of proof then shifted to the
claimant, Easter Mae Jenkins, to prove a defense to the forfeiture
by a preponderance of the evidence."
"To establish an innocent owner defense under 21 U.S.C. Sec
881(a)(7), a claimant must prove more than mere innocence. A
claimant may avoid forfeiture of her property by proving EITHER
ignorance of the illegal activity occurring on her premises or a
lack of consent to that activity. While this Court believes that
Easter Mae Jenkins was not personally involved in the drug
transactions occurring in her home, the evidence adduced at trial
indicates that she cannot take advantage of either aspect of the
innocent owner defense."
In order for Easter Mae Jenkins to prove her ignorance of the
illegal activity, "the Court does not need to find that the
claimant had actual knowledge; instead, the claimant must prove the
absence of actual knowledge." Imagine yourself having to
convincingly prove that you did not know something.
Continues the court: "In light of the number of regular visitors at
her residence, Ms. Jenkins presented little evidence at trial that
proved her ignorance. Although Ms. Jenkins worked from 9:00 a.m.
to 4:00 p.m. and from 11:00 p.m. to 4:00 a.m. six days per week,
the drug activities at her home occurred primarily during the
evening hours." Note that Easter Mae Jenkins worked 72 hours per
week.
The court noted that the fact that there were five guns found in
the house undercut Ms. Jenkins' claim of ignorance. Quoth the
court: "Although the remote area may justify the desire to own a
single weapon, Ms. Jenkins' testimony did not demonstrate that
there had been any violence or criminal acts in the area to explain
the need for approximately five guns scattered around the house."
Once guns are found in your home, it appears, the inference is that
your house must be the site of illegal activity unless you can
explain why you need so many.
Since her attempt to prove her ignorance failed, the court next
examined whether or not she proved her lack of consent. In order
to prove her lack of consent, Jenkins would need to prove that she
took "all reasonable steps to prevent the illicit use" of her
house. According to the court, this means that she should have
thrown out her drug dealing daughters or turned them into the
police. Since she didn't do this, she "consented" to the illegal
activity.
As the court put it: "Easter Mae Jenkins 'fussed' at her daughter
Jennifer for using drugs and told her daughters the she did not
want any drugs in the house. Despite her belief that her pleas
would be sufficient, she should have called the police department
or the Drug Enforcement Agency for help with her children. She did
not throw her daughters out of the house because she was concerned
about providing shelter for their young children. Although Ms.
Jenkins' maternal love and concern for her grandchildren are
certainly commendable, her actions do not constitute reasonable
efforts to prevent the use of her property in drug transactions."
After knocking the legs out from under her "innocent owner
defense," the court assumed a sympathetic posture as it lowered the
boom.
"It is with great regret that this Court orders the forfeiture of
the defendant property to the United States. Congress had two
aims in enacting 21 U.S.C. Sec. 881(a)(7): 'to punish criminals
while insuring that innocent persons are not penalized for their
unwitting association with wrongdoers.' In light of these purposes,
it seems unduly harsh to order the forfeiture of Easter Mae
Jenkins' home. Although the loss of the family dwelling will
somewhat punish Sharon, the perpetrator of the Title 21 offenses,
Easter May Jenkins will bear the full effect of the forfeiture.
She loses the home that she prudently purchased with the proceeds
from her husband's wrongful death settlement because she continued
to provide for her daughters through hard work even when their
treatment of her was reprehensible and their respect for her
minimal. Unfortunately, the law requires this result."