Fourth Circuit Out of Step on Asset Forfeiture

As Americans we grow up learning that our criminal justice system is based on the principle that everyone accused of a crime is innocent until proven guilty — and that no one can be punished before getting a fair trial. Unfortunately, the government doesn’t always follow this principle.

In the U.S. Court of Appeals for the Fourth Circuit, a court has the power to restrain a defendant’s property, preventing him or her from selling or otherwise disposing of it, even though the government has yet to secure a conviction or even establish that the property has been criminally tainted in any way. Such is the case with Sergeant First Class William Todd Chamberlain, whose home is now subject to forfeiture even though the government admits that it has no connection to any wrongdoing whatsoever.

A federal district court approved of this restraint, and now Chamberlain has appealed that decision to the Fourth Circuit. Chamberlain, a former Special Forces soldier, is one of five defendants alleged to have embezzled federal funds totaling $200,000 ($40,000 each) while on tour in Afghanistan. The government has decided to recoup all $200,000 from Chamberlain alone — going after his home while leaving the property of the other defendants (who unlike Chamberlain don’t dispute their guilt).

The government relies on a federal law that allows courts to file a pre-trial restraining order on tainted assets so as to preserve their availability for forfeiture upon conviction, as well as another section of that law that allows for the substitution of untainted property during post-conviction forfeiture proceedings in situations where the defendant has caused the property to become unavailable. That problem is that now we have a case of pre-conviction, pre-trial restraint of untainted property.

This is an outrageous attempt to circumvent the clear meaning of a statute in order to unlawfully encumber the private property of an individual, in clear violation of Sergeant Chamberlain’s constitutional rights. The argument in favor of pre-trial restraint of tainted assets — that the defendant never legitimately owned them anyway, and thus really has no rights to be violated — is wholly lacking. This is why the fact that the district court sided with the government, and that current Fourth Circuit precedent is in line with that decision, is absurd — particularly so after the Supreme Court’s ruling in United States v. Luis earlier this year (which rejected the freezing of untainted assets that would allow a defendant to pay for counsel of choice).

The district court’s ruling is based on a 25-year-old interpretation of the law that has since been repudiated by every other circuit that has addressed the issue. Cato has filed an amicus brief in support of Sergeant Chamberlain, joined by the National Association of Criminal Defense Lawyers, urging the Fourth Circuit to end its incorrect and outmoded practice.

Innocent until proven guilty is the bedrock foundation of American criminal law, and it is high time that the Fourth Circuit remembers that fact in the context of asset forfeiture.

Thanks to Cato legal associate David McDonald for his help with this post.