Michigan Civil Forfeiture
Dehko et al. v. Holder
Feds Seize Entire Bank Accounts of Family Grocery Store and Independent Gas Station
Can the government use civil forfeiture to take your money when you have done nothing wrong—and then pocket the proceeds? The IRS thinks so.
For over 30 years, Terry Dehko has successfully run a grocery store in Fraser, Mich., with his daughter Sandy. In January 2013, without warning, the federal government used civil forfeiture to seize all of the money from the Dehkos’ store bank account (more than $35,000) even though they’ve done absolutely nothing wrong. Their American Dream is now a nightmare.
Federal agents in Michigan struck again in March and April of 2013, when they seized the bank account of Mark Zaniewski’s independently owned gas station (more than $70,000). Neither the Dehkos nor Zaniewski were charged with any crime—the Government merely believed without any real investigation that the deposits of the lawfully earned money from their legitimate businesses were suspicious.
But federal civil forfeiture law features an appalling lack of due process: It empowers the government to seize private property from Americans without ever charging, let alone convicting, them of a crime. Perversely, the government then pockets the proceeds while providing no prompt way to get a court to review the seizure.
The Dehkos and Mark Zaniewski teamed up with the Institute for Justice to fight back in federal court last year and, after nearly a year of expensive litigation, the Government returned their money. The Dehkos and Zaniewski are continuing the fight, however, to ensure that the Government respects due process whenever it seizes money in the future. A victory will vindicate not just their right to be free from abusive forfeiture tactics, but the right of every American not to have their property wrongfully seized by government.
Under pressure from the waves of negative publicity surrounding its abuse of federal forfeiture laws, the IRS announced in October 2014 that it would no longer pursue lawfully earned money in structuring-related cases. Accordingly, the Dehkos and Mark Zaniewski dismissed their lawsuit against the IRS, which sought to curb its misconduct in precisely those cases.