2015-09-18

Cato: The Right to Pay for Your Own Lawyer

Criminal asset forfeiture has the taste of Old Testament justice: an eye for an eye, a tooth for a tooth. The bank robber stole $100,000, so the government takes $100,000 from him. That seems right and fair, but only if we know that the defendant’s guilty.

If the government took $100,000 from someone who was innocent, or whose guilt was ambiguous, it wouldn’t merely be an “unjust” forfeiture, it would be theft—or, to be more politic, an uncompensated and unwarranted taking.

Consider the case of Sila Luis. For several years, Luis ran a healthcare company that provided home nursing services to patients enrolled in Medicare. In 2012, the government accused Luis of fraud, claiming that her company billed Medicare for unnecessary services. In addition to criminal charges, the grand jury indictment included a forfeiture finding, stipulating that if Luis is convicted, up to $45 million of her personal assets would be forfeited, to make up for all of the money her company ever received from Medicare.


Leaving aside the validity of that number—the government hasn’t alleged that all, or even most, of the claims submitted to Medicare were false—the questionable fairness of holding an individual personally responsible for a company’s liabilities, and the fact the Luis doesn’t have anywhere near $45 million, the indictment got one thing right: the government should only be able to confiscate Luis’s property after she’s been convicted. Of course, the government found a loophole: a statute providing that when the government thinks a defendant is going to spend or hide assets before they can be forfeited, prosecutors can ask for a court order “freezing” the assets.

Read more at http://www.cato.org/blog/right-pay-own-lawyer

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