A new Department of Justice (DOJ) directive from Attorney General Jeff Sessions makes it more important than ever to own cryptocurrency and to do so outside of digital exchanges which function like traditional banks; translation, they will rush to obey law enforcement agencies. The new directive expands the power of civil asset forfeiture for federal agents, allowing them to sidestep laws in the 20 states that currently restrict the practice.
Do Not Carry Unnecessary Cash With You
Civil asset forfeiture allows federal or local law enforcement to confiscate property and wealth from anyone suspected of committing a crime or of being connected to one. The targeted person doesn't need to be charged or arrested. No crime needs to be proven.
Even in the presence of a crime, the person's property may have been used without their knowledge. For example, Russ Caswell fought for years to retain ownership of his motel in Massachusetts which was worth $2 million. Federal and local law enforcement claimed the motel was theirs because drug deals had happened without Caswell's knowledge. He ultimately prevailed but it required backing from the powerful Institute for Justice and an intense media campaign. Success in contesting the seizures is rare.
Because the process is a civil and not a criminal one, there are no due process protections and law enforcement has a free hand. The evidentiary standard reduces to a police officer's alleged suspicions; for example, cash is always suspected drug money. There is no "innocent
until proven guilty" which means the the burden falls on the victim to prove the cash is not related to drugs. It is possible to contest the seizure in court but the owner has no right of representation and bears the legal cost which can rival or surpass the amount stolen. (Guidelines in a 2000 law, the Civil Asset Forfeiture Reform Act, suggest that a successful claimant can recover some legal fees but most victims are not aware of the possibility. And they need to prevail.)
Law enforcement relies on innocent people giving up. According to a 2016 report from the Heritage Foundation, "A vast majority of federal civil forfeiture cases—88 percent by some estimates—never see the inside of a courtroom."
The rate of discouraged victims may be considerably higher…for several reasons. Federal thefts generally involve larger amounts than state or local ones and so the victims are more likely to pursue justice. On the state and local level, traffic stop confiscations are popular. A police officer pulls over a driver and, either through inquiry or a search, he discovers a wad of "drug money" which is seized on the spot. How many victims simply drive away? No one knows.