6.34 Forfeitures

6.34.1

In General

Real property is subject to forfeiture to the United States of America if the property is used in violation of law or is acquired with proceeds of the commission of a crime (such as drug trafficking). The most common federal forfeiture statutes are:

  • 21 U.S.C. 881 is a civil "in rem" forfeiture action that is brought directly as an action against the property. There is no requirement that the owner be convicted of a crime.
  • 21 U.S.C. 853 is a criminal "in personam" forfeiture action requiring that the individual defendant be convicted of a crime.
  • 18 U.S.C. 1963 is the "RICO" criminal "in personam" forfeiture requiring that the individual defendant be convicted of a crime.

Individual states also have statues relating to forfeiture actions. Although a series of bulletins have been written on insuring property which has been the subject of a forfeiture action, this area should be considered an extrahazardous risk. Therefore, before attempting to insure on either a federal or state forfeiture action, underwriting guidance from counsel on a state, regional or national level must be sought.