Patriot Forfeitures Reach Beyond Terror Targets

PT       2003-07-05 
In a recent report to Congress regarding the enhanced foreign money forfeiture powers of the post-9/11 Patriot Act, Justice Department prosecutors dwelled on a certain “model” case -- only it was not a case involving terrorism but rather garden variety domestic embezzlement. Some State Department officials are concerned that such a trend “might be seen by other countries as arbitrary or trying to extra-territorially impose our laws” under the guise of fighting terrorism, an administration official has told the New York Times.
The troubling model case involves an American lawyer who was accused of defrauding clients out of millions of dollars and absconding to Central America. Federal prosecutors indicted him and moved to freeze and seize some of the ill-gotten booty that they traced to a bank in Belize. The accused lawyer and his wife were allegedly bleeding the foreign accounts to purchase luxury items such as yachts.
However, a court in Belize blocked the move by the feds to freeze the assets.
Enter the handy, dandy Patriot Act.
Under the Act’s enhanced forfeiture provisions, the Justice Department was able to move in late 2001 to seize about $1.7 million -- not from the institution in Belize -- but from the Belizean banks’ correspondent or so-called “inter-bank” accounts in the United States.