Money Seizures

Since the passage of the Civil Assets Forfeiture Reform Act of 2000 (CAFRA), Customs has made thousands of money seizures from persons entering or departing the United States. Foreign currency transactions are undergoing particular scrutiny in the post-9/11 world. The United States requires reporting of all cash and cash equivalents transported into or out of the country when the value equals or exceeds $10,000. However, not all checks or drafts must be reported.

Those who violate currency regulations face Customs seizures and penalties. Often, these violations are a result of a passenger’s failure to complete mandatory currency reporting forms or errors made when filling out such forms. An innocent mistake in reporting the transportation of currency can lead to a seizure of funds.

Couriers must contend with a distinct set of regulations. Many times, business people bringing in funds for their companies are wrongly alleged to be carrying out courier functions, which implicate both state and federal banking regulations. We have experience in interpreting and applying federal and state laws pertaining to couriers and wire transfer services.

Customs officials sometimes misinterpret currency seizure regulations. Families must report currency transfers together, but a husband and wife may each be allowed the full exclusion in certain circumstances. There are limits on the severity of penalties that Customs may impose, no matter the value of the violation at issue.

Seizures can also extend to conveyances, such as airplanes, boats and automobiles. These, too, may be subject to release by Customs should the evidence show that the owner is innocent of the alleged crime.

We have counseled U.S. and international clients with regard to currency seizures. The sums at issue total in the millions of dollars. Frequently, as a result of legal intervention and, depending upon the unique circumstances of the case, the majority of seized funds are returned. On the other hand, in a government-issued report, out of 168 currency seizures approximately 95% of the funds were forfeited to the government, many times because those accused fail to assert their rights. Effective legal counsel can make the difference.

In addition to money seizures, Customs often seizes goods because they are deemed to be counterfeits or in violation of the intellectual property rights of U.S. companies. However, upon closer inspection many allegedly-infringing goods are actually distinct from their U.S. counterparts. Other times, imported goods make fair use of a word or phrase that is given limited protection under the U.S. intellectual property laws.

Goods may also be seized because they are in violation of other agencies’ regulations, such as those of the Food and Drug Administration, the Consumer Product Safety Commission, the Department of Agriculture or the Department of State. In these instances, Customs relies upon its interpretation of other agencies’ regulations as the legal basis for the seizure, and the regulatory tapestry often leads to complex legal scenarios. Seizures may occur even when cargo is not entered into the U.S., such as cargo remaining on board a conveyance, when a license is required to transit the U.S. Seizures are almost always a surprise occurrence and may happen even when importers attempt to adhere to applicable laws and regulations. When the unexpected happens, effective legal counsel makes a difference.