Roskam, Lewis Urge AG Sessions to Expedite Asset Forfeiture Refunds

May 3, 2017
Press Release

Washington, D.C. —U.S. Representatives Peter J. Roskam (R-IL) and John Lewis (D-GA) wrote a letter to U.S. Attorney General Jeff Sessions asking him to expedite the Department of Justice (DOJ)’s review of civil asset forfeiture cases.

During the 114th Congress, Reps. Roskam and Lewis served, respectively, as Chairman and Ranking Member of the Ways & Means Subcommittee on Oversight. They led a comprehensive investigation into Internal Revenue Service (IRS) and DOJ practices that led the IRS to change its policies and formally apologize to victims of forfeiture abuse.

“We respectfully urge the DOJ to examine the cases that the IRS has recommended for remission of funds and to remit the funds expeditiously,” the lawmakers wrote.

Last month, as first reported by The Daily Beast, Rep. Roskam, who now serves as Ways & Means Tax Policy Chairman, and Rep. Joe Crowley (D-NY), who chairs the Democratic Caucus, “introduced the RESPECT Act...which would limit the IRS’s ability to seize people’s money without first charging them with a crime.”

Read the full letter here or below.

 

The Honorable Jeff Sessions

Attorney General

U.S. Department of Justice

950 Pennsylvania Ave, NW

Washington, DC 20530-0001

Dear Attorney General Sessions:

In the 114th Congress, the Ways and Means Subcommittee on Oversight held a series of hearings examining the Internal Revenue Service’s (IRS) use of its civil asset forfeiture authority to seize assets based on allegations of individuals and businesses structuring financial transactions to avoid Bank Secrecy Act reporting requirements without connection to any other illegal activity.

In the hearings by the Oversight Subcommittee, it was revealed that the IRS was previously engaged in a practice of seizing the assets of individuals that had violated federal structuring laws despite the fact that the assets were derived from a legal source.  Some of these individuals were told by bank employees that depositing over $10,000 at a time created extra paperwork, some individuals had a business insurance policy that only covered up to $10,000 cash on hand, and some individuals did not want banks to file reports on their transactions to the IRS and did not realize that it was illegal to structure transactions to avoid those reports.

As a result of the work done by the Subcommittee, in October 2014, the IRS changed its policy to seize structured assets only if the assets were connected to other illegal activity.  Additionally, in June 2016, the IRS sent notices to all individuals and businesses from whom it had seized assets based on allegations of structuring since FY 2010 stating that they could petition the IRS for remission of the seized funds if the IRS would not have seized those same assets under its new policy. 

To date, the agency has reviewed 454 petitions from individuals whose funds were seized prior to the 2014 policy change in an attempt to return all legal-source funds to their rightful owners. According to Commissioner Koskinen, as of March 1, 2017, the IRS has returned more than $6 million to property owners and recommended that the Department of Justice (DOJ) return more than $16 million.

We respectfully urge the DOJ to examine the cases that the IRS has recommended for remission of funds and to remit the funds expeditiously in appropriate cases, in order to assure the public that both the IRS and DOJ are carrying out their law enforcement responsibilities in a fair and just manner. To help us ensure that taxpayers are made whole, please provide us an update on your agency’s actions regarding the cases in which the IRS has recommended that the DOJ return seized funds.

Sincerely,

 

Peter J. Roskam                                                                                  John Lewis

Member of Congress                                                                          Member of Congress

 

Background

Last September, the House of Representatives voted 415-0 to unanimously pass the “Clyde-Hirsch-Sowers-RESPECT Act”. The bill was named for Andrew Clyde; Jeffrey, Richard, and Mitch Hirsch; and Randy Sowers – all small business owners victimized by forfeiture abuse.

In May, Chairman Roskam’s Ways & Means Oversight Subcommittee held a hearing on Protecting Small Businesses From IRS Abuse. Both Republicans and Democrats expressed outrage over the Internal Revenue Service (IRS) and Department of Justice (DOJ)’s actions to seize the bank accounts of law-abiding American citizens. Watch Chairman Roskam’s opening statement here and read the remarks here.

In June, under intense pressure from Congress, the IRS finally agreed to send letters to everyone from whom it had seized assets based on allegations of “structuring” cash deposits. These people, who had done nothing wrong, can finally get some or all of their money back.

Randy Sowers, a Maryland dairy farmer who testified at the May hearing, finally got his money back in July as a result of the Subcommittee’s work.