Policy Text
TRAINING BULLETIN
SEIZURE ORDERS FOR PROCEEDS IN THE ACCbUNTS
OF FINANCIAL INSTITUTIONS
Bulletin Index Number: IV - J
Alphabetical Index:: Criminal Investigation:
Seizure of Bank Accounts
Narcotic and Dangerous Drug Offenses: Forfeiture of Proceeds
Publication Date: 15 Mar 90
Because of constitutional and statutory privacy rights, it is necessary to obtain a judicially-issued process in order to seize narcotic proceeds for purposes of forfeiture from an account held at a financial institution (see United States V. Device Labeled Theramatic
[9th Cir. 1987] 641 F.2d
1989; Section 7460 Government Code, Right to Financial Privacy) .
A search warrant is not a proper means of obtaining account proceeds because narcotic proceeds are not themselves stolen, evidence of a crime,* or the means of committing a crime (1524 P.C., Issuance of Search Warrant)
. Further, proceeds cannot be seized without an act by the financial
institution which a search warrant cannot command (e.g., drafting a check). A search warrant is the proper means of obtaining bank records (7475 G.C., Search Warrants)
.
___________________________________________ Adapted by permission from a document issued by the Forfeiture Program, Division of Enforcement, California Department of Justi ce. For further information, contact Deputy
Attorney General Gary Schons of the Forfeiture Program (1-619-237-7499). *The money "on the person" of the suspect at the time of the deposit would have been evidence. The check issued by the bank is not. Bank records, however, are evidence tending "to show a felony has been committed."
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The proper means of obtaining account proceeds is a seizure order. issued pursuant to 11471 H&S, Seizure of Property Subject to Forfeiture
, which states:
Property subject to forfeiture under this division may be seized by any peace officer upon process issued by any court having jurisdiction over the property.
Because jurisdiction in a forfeiture case is exclusively in the Superior Court, the order should be obtained from the Superior Court in the same county as the bank branch or office holding the
account (11488.4 H&S, Petitions of Forfeiture)
. A showing by affidavit of probable cause to
believe the proceeds are subject to forfeiture is required (see United States v. One Red Ferrari
[9th Cir. 1989] 875 F.2d 1989). A search warrant for records may be served concurrently with a seizure order for proceeds and may be based on the same affidavit of probable cause. After discussions with representatives of a number of California banks under the auspices of the California Bankers Association, a form of seizure order for proceeds in the account of a financial institution, particularly a demand account (check ing or saving), was created (see Appendix).
The order addresses three separate functions integral to effecting the seizure of account proceeds:
First, it permits and directs the peace officer to seize the property (satisfying the Fourth Amendment). Second, it gives the officer permission to enter the premises of the financial institution (to make a "search" in the constitutional sense). Third, it directs the financial institution or custodian to do the following: (a) freeze the balance of funds on deposit upon service of the order;
(b) refuse to honor checks or orders for payment against the account any time after service of the order;
(c) issue a bank check for the proceeds in the account, less items in process of collection, the next business day after service, payable to the Court or law enforcement agency "in trust;" and
(d) pay, within fifteen days of the service of the order, the sum of any items collected
which were in process at the time of the service of the order.
Accordingly, when a peace officer serves the order, the financial institution will freeze the account, meaning it will not accept deposits to or withdrawals from the account, or honor any
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liens against or assignments of the account, and it will refuse checks or orders for payment
against the account. The freeze of the account applies to all persons -- account holders, assignees and payees -- and at all branches of the institution. On the next business day, the institution will pay the balance of the account to the seizing officer by bank draft payable to the court or agency "in trust," minus unpaid service charges and excluding funds subject to a security interest in favor of the financial institution. Finally, within fifteen days of the service of the order the institution will issue a check for the balance of any items that were in the process of collection when the order was served. The Forfeiture Program, Division of Enforcem ent, California Department of Justice has
furnished this information on seizure orders to the California Bankers Association for distribution to its members. The Attorney General expects the use of this order to establish a routine procedure for the seizure of account proceeds.
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APPENDIX: A SAMPLE ORDER FOR SEIZURE OF. PROPERTY SUBJECT TO
FORFEITURE (11471 H&S)
IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF
IN RE PROPERTY SUBJECT TO ) No.
FORFEITURE PURSUANT TO HEALTH )
AND SAFETY CODE SECTION 11470 ) ORDER FOR SEIZURE OF PROPERTY
____________________________________) SUBJECT TO FORFEITURE
____________________________________) (HEALTH & SAFE. CODE, SEC. 11471)
____________________________________)
Affidavit of ________________________ a peace officer of the State of California,
employed by __________________________ having