Protect Yourself from Civil Asset Forfeiture (Videos)

This post was submitted by Erik Oswald, SchiffGold Precious Metals Specialist. Any views expressed are his own and do not necessarily reflect the views of Peter Schiff or SchiffGold.

The New York Times reported a major story this week about Ms. Carol Hinders, who had her checking account seized by the IRS. Why? Because she had the audacity to deposit cash in increments below $10,000. While this is an outrage in and of itself, it is merely a symptom of a larger problem: Civil Asset Forfeiture.

If you deposit more than $10,000 dollars in cash in any US bank, you are required to fill out anti-money laundering paperwork. This is to ensure that the money came from “legitimate enterprises” and is not related to any sort of illicit or criminal activity.

In the NY Times expose, many of the individuals were told by their bankers that if they kept their deposits below the $10,000 amount, they would not have to fill out any sort of paperwork documenting the transaction. However, this becomes an issue if you make multiple deposits under the $10,000 amount in a short time frame – say, a month. This activity can be flagged as suspicious and put your assets in danger of seizure.

If there is suspicion that this money was earned illegally, the State – whether a police officer, IRS agent, or any other government enforcer – can seize this money from you with no probable cause or proof that the money was earned illegally. The onus is on you to prove that your money was earned from a legitimate source. From the NY Times article:

Using a law designed to catch drug traffickers, racketeers and terrorists by tracking their cash, the government has gone after run-of-the-mill business owners and wage earners without so much as an allegation that they have committed serious crimes. The government can take the money without ever filing a criminal complaint, and the owners are left to prove they are innocent. Many give up.”

In 2012, the net value of all assets seized from the American people by the State totaled about $4.2 billion. The majority of this money is never recovered from the government, as the recourse for getting your assets back is vague and convoluted. Not to mention the exorbitant costs inherent in a legal battle against the government.

The money seized through civil asset forfeiture is a major source of revenue for police departments, local governments, and federal government agencies.

The dangers posed by Civil Asset Forfeiture to assets held in the financial system or even the cash in your wallet are all too clear. These stories further reinforce our belief that everybody should have a percentage of their assets in physical gold and silver coins or bars. Physical precious metals stored in a home safe are much more difficult for the authorities to confiscate. Law enforcement is not allowed to enter your home without a warrant or your permission.

Financial accounts of all types are easy pickings for government expropriation. We owe it to ourselves and our families to ensure that at least a portion of our wealth is as far away from the clutches of the State as possible.

Videos on Civil Asset Forfeiture:

John Stossel spoke about Civil Asset Forfeiture with Eapen Thampy, Executive Director of Americans for Forfeiture Reform:

Suppose you don’t trust banks. You’ve got a lot of cash you keep in your car… [Police can] seize it without ever taking you to court. And police departments around the country have discovered this is a really good way to raise money.”

For a more humorous, but still educational look at the issue, check out this video from Last Week Tonight with John Oliver:

It’s not you that needs to be charged with a crime [in civil asset forfeiture situations], because it’s not you that’s on trial. It’s your stuff. That’s why these cases have historically had eye-catching names… such as, ‘United States v. Eight Thousand Eight Hundred and Fifty Dollars ($8,850) in United States Currency’… Your possessions generally have fewer protections under the law than you do.” 

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