Tag: department of justice

Eric Holder Issues New Asset Forfeiture Restrictions for Structuring Offenses

Today Attorney General Eric Holder issued new guidelines to federal prosecutors tightening the rules for seizing assets for so-called “structuring” offenses.

Under the Bank Secrecy Act, structuring occurs when someone is suspected of arranging their financial transactions as to avoid triggering a report to the federal government by the financial institution.  Some of civil asset forfeiture’s most egregious abuses are the result of federal prosecutors utilizing this nebulous statute to empty the bank accounts of unwitting citizens and small businesses who are never charged with any crime or even aware that their transactions are considered illegal. 

The new rules require:

1. That structuring seizures against people for whom there is no criminal charge be based upon probable cause that the funds were either generated by unlawful activity or intended for use in anticipated unlawful activity.  Alternatively, prosecutors must procure a warrant from a court and with the approval of either the U.S. Attorney (for Assistant U.S. Attorneys) or the Chief of the Asset Forfeiture and Money Laundering Section (AFMLS) (for Criminal Division trial attorneys).

2. That when the prosecutor determines subsequent to a structuring seizure that the government lacks the necessary evidence to succeed at either a civil or criminal trial, the seizing agency must return the full amount.

3. That when a prosecutor seizes property pursuant to suspicion of structuring, the prosecutor must file either a criminal indictment or a civil complaint, or receive an exception from either a U.S. Attorney or Chief of AFMLS within 150 days or else return the seized assets.

4. That all settlements must be complete and in writing.  Informal settlements are expressly prohibited.

Quiet Change Expands ATF Power to Seize Property

A quick glance at the Federal Register (Vol. 80, No. 37, p. 9987-88) today reveals that Attorney General Eric Holder, who earned cautious praise last month for a small reform to the federal equitable sharing program, has now delegated authority to the Director of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) to seize and “administratively forfeit” property involved in suspected drug offenses.  Holder temporarily delegated this authority to the ATF on a trial basis in 2013, and today made the delegation permanent while lauding the ATF for seizing more than $19.3 million from Americans during the trial period.

Historically, when the ATF uncovered contraband subject to forfeiture under drug statutes, it was required to either refer the property to the DEA for administrative forfeiture proceedings or to a U.S. Attorney in order to initiate a judicial forfeiture action.  Under today’s change, the ATF will now be authorized to seize property related to alleged drug offenses and initiate administrative forfeiture proceedings all on its own.

The DOJ claims this rule change doesn’t affect individual rights (and was thus exempt from the notice and comment requirements of the Administrative Procedure Act) and that the change is simply an effort to streamline the federal government’s forfeiture process.  Those who now stand more likely to have their property taken without even a criminal charge may beg to differ.

Further, the department claims that forcing the ATF to go through a judicial process in order to seize property requires too much time and money.  Whereas an “uncontested administrative forfeiture can be perfected in 60-90 days for minimal cost […] the costs associated with judicial forfeiture can amount to hundreds or thousands of dollars and the judicial process generally can take anywhere from 6 months to years.”  In other words, affording judicial process to Americans suspected of engaging in criminal activity takes too long and costs too much. 

Holder’s DOJ Wants a Veto over Parents’ Choice of School

Though the U.S. Department of Justice partially backed down on its lawsuit against Louisiana’s school choice program in November, yesterday the DOJ filed its proposal to oversee the program. The program provides school vouchers to low-income families with children otherwise assigned to failing government schools. Among many proposed regulations, the DOJ wants the state of Louisiana to give the federal government the following information about each school choice applicant: 

1. Name

2. Student ID number

3. Address

4. Grade

5. Race

6. School applicant attends in current school year, if any

7. Louisiana School Performance Score (letter grade) for school in (6), above, if applicable

8. Public school district of the school in (6), if applicable

9. District public school applicant would be assigned to attend for the upcoming school year if applicant does not receive a voucher

10. Louisiana School Performance Score (letter grade) for school in (9), above

11. Student enrollment in the school in (9), above, for the current school year, by race

DOJ Still Fighting School Choice in Louisiana

Last week I noted that it was “long past time for the U.S. Department of Justice to drop its embarrassing lawsuit which would keep black kids in failing schools.” The Louisiana Department of Education released a study that completely undermined the DOJ’s case against the state’s school voucher program, showing that the program increased racial integration in most of the schools under federal desegregation orders and had a miniscule impact in the remainder.

Today, Michael Warren of the Weekly Standard reports that the DOJ has dropped part of its fight against school choice in Louisiana:

The Obama administration’s Justice Department has dropped a lawsuit aiming to stop a school voucher program in the state of Louisiana. A ruling Friday by a United States district court judge revealed that the federal government has “abandoned” its pursuit of an injunction against the Louisiana Scholarship Program, a state-funded voucher program designed to give students in failing public schools the opportunity to attend better performing public or private schools. 

“We are pleased that the Obama Administration has given up its attempt to end the Louisiana Scholarship Program with this absurd lawsuit,” said Louisiana governor Bobby Jindal, a Republican, in a statement. “It is great the Department of Justice has realized, at least for the time being, it has no authority to end equal opportunity of education for Louisiana children.”

The move may have resulted from the bad press or a sudden acceptance of common sense, but more likely it was a simply legal maneuver to prevent the Black Alliance for Educational Options and the Goldwater Institute, representing parents of voucher recipients, from intervening in the lawsuit as defendants. As Warren reports:

On Friday, Judge Ivan Lemelle of the U.S. district court of the Eastern District of Louisiana ruled the parents could not intervene in the case because the feds are “no longer seeking injunctive relief at this time.” Lemelle explained that in the intervening months since the Justice Department filed suit, it had made clear both in a supplemental filing and in its opposition to the parent group’s motion to intervene that it was not seeking in its suit to end the voucher program or take away vouchers from students.

Lemelle continued: “The Court reads these two statements as the United States abandoning its previous request that the Court ‘permanently enjoin the State from issuing any future voucher awards to students unless and until it obtains authorization from the federal court overseeing the applicable desegregation case.’”

Lemelle will hold an oral hearing on Friday, November 22, during which Justice will make its case for the federal review process of the voucher program. In his statement on Friday’s ruling, Jindal criticized the federal government’s efforts.

“The centerpiece of the Department of Justice’s ‘process’ is a requirement that the state may not tell parents, for 45 days, that their child has been awarded a scholarship while the department decides whether to object to the scholarship award. The obvious purpose of this gag order would be to prevent parents from learning that the Department of Justice might try to take their child’s scholarship away if it decides that the child is the wrong race,” said Jindal. “The updated Department of Justice request reeks of federal government intrusion that would put a tremendous burden on the state, along with parents and teachers who want to participate in school choice.”

In other words, the DOJ is still seeking the legal authority to prevent low-income kids from escaping failing public schools if the feds say they have the wrong skin color.

New Study Completely Undermines DOJ’s Anti-School Choice Lawsuit

It’s long past time for the U.S. Department of Justice to drop its embarrassing lawsuit which would keep black kids in failing schools.

The DOJ sued Louisiana earlier this year, claiming that its school voucher program may be negatively impacting desegregation efforts. When it became apparent that the DOJ’s evidence amounted to the thinnest of gruel, everyone from Gov. Bobby Jindal and Rep. Eric Cantor to the Washington Post called on the Obama administration to drop its frivolous lawsuit. Even after two PhD students at the University of Arkansas released a study estimating that Louisiana’s school voucher program had a positive impact on racial integration, the DOJ refused to back down. I wrote then:

If the DOJ’s case was already like a house of cards resting atop a rickety stool, then the new University of Arkansas study kicked out the stool. The study, “The Louisiana Scholarship Program,” by Anna J. Egalite and Jonathan N. Mills, finds that the transfers resulting from the LSP vouchers statewide “overwhelmingly improve integration in the public schools students leave (the sending schools), bringing the racial composition of the schools closer to that of the broader communities in which they are located.” Moreover, in the districts that are the focus of the DOJ litigation, the “LSP transfers improve integration in both the sending schools and the private schools participating students attend (receiving schools).”

Now a study sponsored by the state of Louisiana finds that the voucher program improves racial integration in 16 of the 34 districts under federal desegregation orders while having little to no impact on the remainder. Whereas the University of Arkansas study produced estimates based on publicly available data, the Louisiana study reflects the actual effect of the program during the 2012-13 school year. Politicoreports:

Louisiana hired Boston University political science Professor Christine Rossell to analyze the effect of vouchers in 34 districts in the state under desegregation orders. Rossell found that in all but four of the districts – some of which are majority white, some majority black and some more evenly split – vouchers improved or had no effect on racial imbalance. And in the districts where racial imbalance worsened, the effects were “miniscule.”

Louisiana’s voucher program allows students to transfer out of failing public schools into private schools using public funds. The majority of the students participating in the 2012-13 school year — almost 76 percent — were non-white. A total of 551 students used the vouchers.

In the 2013-14 school year, more than 85 percent of the nearly 6,800 voucher students were black. So long as the DOJ refuses to drop its lawsuit — which would have opposite of its supposedly intended effect — the Obama administration’s message to these students is: “If you don’t like your school, you can’t leave your school.”

School Choice Lawsuit Roundup

School choice advocates have been winning in the halls of state legislatures and in the court of public opinion, so opponents have taken to the courts of law. Since the U.S. Supreme Court ruled in Zelman v. Simmons-Harris (2002) that school vouchers are consistent with the First Amendment’s Establishment Clause, opponents of choice have been scrambling to find novel reasons to challenge school choice programs. Here’s a brief summary of school choice lawsuits around the nation:

1) In Louisiana, the U.S. Department of Justice has sued to halt the state’s school voucher program, arguing that it hurts the desegregation effort. The DOJ’s already weak case was further undermined by a new study released today showing that school choice actually improves integration. Since 90 percent of the voucher recipients are black, the DOJ’s lawsuit would have the effect of keeping low-income blacks from attending the schools of their choice.

Earlier this year, Louisiana’s state supreme court ruled that the voucher program was unconstitutionally funded, but otherwise left the program intact. The governor and state legislators adjusted the funding mechanism in response.

2) Two days ago, a group of activists in Oklahoma sued the state over its special needs voucher program, arguing that it violates the state constitution’s ban on using public funds at religious schools. Last year, the state supreme court tossed out a challenge to the program by public school districts, ruling that they did not have standing since they are not taxpayers.

3) On the same day, the Arizona Court of Appeals ruled unanimously that the state’s education savings account program, the first in the nation, is constitutional. Anti-school choice activists had argued that it violates the state constitution’s ban on publicly funding religious schools. The court held that students are the primary beneficiaries and that any “aid to religious schools would be a result of the genuine and independent private choices of the parents.” The decision will likely be appealed to the state supreme court.

DOJ Backpedals on School Choice Lawsuit

In response to withering criticism and political pressure, the U.S. Department of Justice is backpedaling on its lawsuit against Louisiana’s school choice program, which provides school vouchers to low-income students assigned to government-run schools receiving a D or F rating for performance. The lawsuit sought to “permanently enjoin the State of Louisiana from awarding any school vouchers to students attending schools in districts operating under federal desegregation orders” unless the state receives permission from the federal government. Now the DOJ is claiming in a carefully-worded letter to Congress that they were just looking for information:

To be clear, we are neither opposing Louisiana’s school voucher program nor seeking to revoke vouchers from any student. […] Our goal in filing a motion for further relief […] was straightforward: The United States is seeking the court’s assistance in ensuring that the information Louisiana collects in connection with its school voucher program is provided to the United States in a timely fashion and that Louisiana implements its program in full compliance with federal law, including the desegregation order in this case.

Unfortunately, the DOJ is being disingenuous. While their lawsuit would not have revoked vouchers that the state had already distributed, it would have blocked all future vouchers to students in districts under desegregation orders without federal permission. In other words, rather than leaving the choice of school in the hands of parents, parents would have to beg the federal government to allow their children to escape from failing government schools. This is problematic since the DOJ’s absurd definition of segregation would prevent black students from leaving a school that the DOJ deems “insufficiently black” because there are a greater percentage of black students than black people living in the district. For example:

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