Federal Prosecutors Trying to Seize Assets: the Details are Important!

Federal prosecutors are more and more fond of trying to seize assets from people who are prosecuted for federal crimes. We see this quite a bit in money laundering and white collar crime cases. However, a recent federal case that started in South Florida shows that the details are always important, and a good lawyer who keeps the feds on their toes can sometimes prevent such asset forfeitures.

The recent decision by the Eleventh Circuit Court of Appeals here in Atlanta in the case of United States v. De la Mata is a perfect example of this principle. Many years ago, the feds prosecuted Mr. De La Mata and others, and got convictions and lengthy sentences. Significantly, some of the defendants included corporations owned and controlled by De La Mata and others. The prosecutors also wanted to forfeit assets owned by the people and by the corporations. However, and here’s the important part, the prosecutors tried to use a short cut, and got the individual defendants to agree to turn over a large quantity of assets. The prosecutors forgot that the corporations were separate entities. As a result, the order entered by the judge turned over assets owned by the corporations, without ever hearing from the corporations themselves.

Several years passed, and the corporations asked for a return of their property. The government refused, and the judge also would not give back the assets. The court of Appeals recently agreed with the corporations. The opinion notes how the prosecutors could not use the shortcut of an agreement with the individual defendants to get property owned by the corporations.

In many of our cases, we negotiate with prosecutors about assets they want to seize from our clients. This recent decision shows how important it is to do our homework in this area.