Complaint for Forfeiture in Rem

In civil asset forfeiture proceedings involving assets such as cryptocurrency, the Assistant United States Attorney (AUSA) might file a Verified Complaint for Forfeiture in Rem that names the asset. The complaint is filed in accordance with Fed. R. Civ. P. Supplemental Rule G(2). The complaint names the Defendant In Rem which is the Defendant Property.

The complaint for forfeiture in rem typically alleges:

• The Court has subject matter jurisdiction over an action commenced by the United States pursuant to 28 U.S.C. § 1345, and over an action for forfeiture pursuant to 28 U.S.C. § 1355(a).
• The Court has in rem jurisdiction over the Defendant Property pursuant to 28 U.S.C. § 1355(b)(1)(A) because acts or omissions giving rise to the forfeiture occurred in that district where the complaint is filed.
• Venue is proper in this district pursuant to 28 U.S.C. § 1355(b)(1)(A) because acts or omissions giving rise to the forfeiture occurred in this district.

The complaint will list the basis for forfeiture. For example, the complaint might alleged the Defendant Property is subject to forfeiture pursuant to:

• 18 U.S.C.§ 981(a)(1)(A) because it is personal property involved in a transaction or attempted transaction in violation of 18 U.S.C. §§ 1956 and 1957, or any property traceable to such property;
• 18 U.S.C. § 981(a)(1)(C) because it is personal property which constitutes or is derived from proceeds traceable to a violation of any offense constituting a specified unlawful activity (as defined in 18 U.S.C. § 1956(c)(7)), namely, a violation of 18 U.S.C. § 1343, or a conspiracy to commit such offense (18 U.S.C. § 1349).

The complaint might list the facts and circumstances supporting the forfeiture in an affidavit signed by a federal agent.

The complaint will list the known claimants by name and address. The complaint will also explain how the United States will publish notice of the lawsuit consistent with the Federal Rules of Civil Procedure, specifically Supplemental Rule G.

In the complaint, the United States will request that the Court forfeit the Defendant Property to the United States, award costs and disbursements in this action to the United States and order any other relief that the Court deems appropriate.

Procedures and Rules Governing Forfeiture Actions

The Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”), 18 U.S.C. § 981 et seq., established the procedural and substantive rules to govern forfeiture actions. Most civil asset forfeiture cases are filed under one of CAFRA’s substantive provisions: section 981(a)(1)(A).

The pleading requirements for complaints for forfeiture in rem are governed by the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions, specifically, Rule G of the Supplemental Rules, which “governs a forfeiture action in rem arising from a federal statute.” Fed. R. Civ. P. Supp. R. A(1); G(1).

The Federal Rules of Civil Procedure also apply, except to the extent that they are inconsistent with the Supplemental Rules. Fed. R. Civ. P. Supp. R. A(2).

Supplemental Rule G(2) requires that the government’s complaint for forfeiture in rem “state sufficiently detailed facts to support a reasonable belief that the government will be able to meet its burden of proof at trial.” Fed. R. Civ. P. Supp. R G(2)(f).

The government’s burden of proof at trial is “to establish, by a preponderance of the evidence, that the property is subject to forfeiture.” 18 U.S.C. § 983(c)(1).

In other words, at the pleading stage, the complaint is only required to “state the circumstances from which the claim arises with such particularity that the defendant or claimant will be able, without moving for a more definite statement, to commence an investigation of the facts and to frame a responsive pleading.” Fed. R. Civ. P. Supp. R. E(2)(a); Fed. R. Civ. P. Supp. R.G, Advisory Committee Notes (noting that the “reasonable belief” standard in Rule G(2)(f) mirrors the sufficiency standard in Rule E(2)(a)).

For this reason, during the pleading stage, it suffices for the government to simply allege enough facts so that the claimant may understand the theory of forfeiture, file a responsive pleading, and undertake an adequate investigation.

Motion to Dismiss a Civil Asset Forfeiture Complaint

A civil forfeiture complaint may not be dismissed because the government lacked sufficient evidence of forfeitability at the time of filing, see 18 U.S.C. § 983(a)(3)(D), and the government may use evidence gathered after filing to meet its burden of proof at trial, see id . § 983(c)(2).

A claimant in an in rem proceeding may move to dismiss under Rule 12(b). Fed. R. Civ. P. Supp. R. G(8)(b)(i). When considering a Rule 12(b)(6) motion to dismiss, the court construes the complaint in the light most favorable to the plaintiff and must assume the truth of all well-pleaded allegations.

When considering the motion, the judge gives the government every favorable inference that may be drawn from the allegations of fact set forth in the complaint.

Factual challenges are not permitted under Rule 12(b)(6). Instead, the court may consider only the facts alleged in the complaint, any documents either attached to or incorporated in the complaint and matters of which it may take judicial notice.