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UNITED STATES v. ALL FUNDS PRESENTLY ON DEPOSIT OR

February 9, 1993

UNITED STATES OF AMERICA, Plaintiff,
v.
ALL FUNDS PRESENTLY ON DEPOSIT OR ATTEMPTED TO BE DEPOSITED IN ANY ACCOUNTS MAINTAINED AT AMERICAN EXPRESS BANK, AMERICAN EXPRESS BANK, LTD., CITIBANK INTERNATIONAL, CITIBANK, N.A., DELTA NATIONAL BANK, AND CAPITOL BANK IN THE NAMES OF CAMBITUR, S.A., CASA DE CAMBIOS, CAMBIDEX, MULTICAMBIO, S.A., MICHEL DUCHAMP, JCJ, INC., AND ALL RELATED ENTITIES AND INDIVIDUALS (COLLECTIVELY REFERRED TO AS THE CLAIMANTS), INCLUDING, BUT NOT LIMITED TO, AMERICAN EXPRESS BANK ACCOUNT NO. 00800045, AMERICAN EXPRESS BANK, LTD. ACCOUNT NO. 000708008, CITIBANK N.A. ACCOUNT NO. 36964602, CITIBANK, N.A. ACCOUNT NO. 36994895, DELTA NATIONAL BANK ACCOUNT NO. 602187, AND CAPITOL BANK ACCOUNT NO. 140023033, AND ALL PROPERTY TRACEABLE THERETO, Defendants.



The opinion of the court was delivered by: I. LEO GLASSER

MEMORANDUM AND ORDER

 GLASSER, United States District Judge:

 Claimant Cambitur S.A. ("Cambitur") brings this "emergency" motion for return of property seized in this civil forfeiture action. More specifically, Cambitur seeks the return of $ 584,445.41 that it sent to American Express Bank (or "the Bank") on November 12, 1992. For the reasons discussed below, claimant's motion is hereby granted. However, execution of this order is stayed for five days to give the government an opportunity to file an appeal.

 FACTS

 On the evening of November 12, 1992, after the warrant had been served, American Express Bank received, via DHL delivery, a package containing a deposit of $ 584,445.41; this package was sent to the Bank by claimant Cambitur. The Bank did not process the funds contained in the package nor did it credit those funds to Cambitur's accounts. Rather, the Bank advised the government that they had received this package and, in response, were told to hold onto the funds. Later that same evening, counsel for Cambitur spoke to Saverio Mirarchi, counsel for American Express Bank, and demanded the return of the DHL package. Mirarchi informed Cambitur that the package could not be returned because the government sought its attachment.

 On November 13, 1992, the day after American Express Bank received the DHL package, the government filed an amended verified complaint in rem, and the clerk of this Court issued a supplemental warrant for arrest. The amended complaint sought the same funds in the subject accounts, but now included, as well, "all funds attempting to be deposited" in those accounts. Cambitur contests the legality of this seizure and moves for return of its $ 584,445.41. *fn1"

 The government responds to Cambitur's motion by claiming that its seizure of the DHL package was lawful. More specifically, the government contends that 21 U.S.C. § 881(b)(4), in conjunction with the Supplemental Rules, authorizes the Attorney General or his representative to seize property without a warrant if there is probable cause to believe that the property is subject to civil forfeiture for a violation of the statute's substantive provisions. Although the only "probable cause" that existed at the time of this seizure admittedly was that the DHL package contained funds intended for deposit into the defendant accounts, the government nevertheless argues that it may establish probable cause in a civil forfeiture case based on information gathered after the seizure occurs.

 The United States submits the following information going to its post-seizure basis for probable cause. On November 16, 1992, the first business day after the seizure, Drug Enforcement Administration Special Agent Juan Arrivillaga went to American Express Bank's offices at One World Financial Center and took possession of the contents of the DHL package, specifically four bundles of checks and money orders. See Declaration of Special Agent Juan Arrivillaga at P 12. Later that day, a narcotics sensitive canine ("K-9 unit") tested the bundles of money orders and checks for the presence of illegal narcotics and alerted positive to the scent of cocaine. Id. at P 13. More importantly, the money orders contained in those bundles were in small, even denominations of United States currency similar to the money orders that the government previously had traced to the premises of a known money launderer. Id. at PP 12-13.

 Before turning to the merits of the arguments briefly set forth above, it is worthwhile to note that since Cambitur is an exchange house or "casa de Cambios" located in Ecuador, South America, its business is exchanging large sums of money. A letter from Dr. Galo Larrea Donoso, the Consul General of the Republic of Ecuador in New York, informs this court that Cambitur is an established and respected business in Ecuador. It moves via order to show cause because the Ecuadorian government is currently threatening to close down Cambitur's operations unless the cambio can obtain sufficient funds to satisfy its outstanding debts. Bearing all these facts in mind, this court now turns to the legality of the seizure.

 DISCUSSION

 This court faces two questions: first, whether the government possesses the authority to seize property without judicial process, in other words a valid warrant; and second, whether the government may establish the probable cause for such a seizure after the seizure occurs. Each of these questions are addressed below.

 Section 881(a)(6) of Title 21 of the United States Code declares that money that is illegally exchanged for a controlled substance, that constitutes the proceeds from an illegal sale of a controlled substance, or that is used or intended to be used, to illegally purchase a controlled substance, "[is] subject to forfeiture to the United States." 21 U.S.C. § 881(a)(6) (1988). Seizure of property forfeitable under subsection (a) is discussed in subsection (b). Relevant to this motion is 21 U.S.C. § 881(b)(4) which provides:

 (b) Any property subject to civil forfeiture to the United States under this subchapter may be seized by the Attorney General upon process issued pursuant to the Supplemental Rules for Certain Admiralty and Maritime Claims by any district court of the United States having jurisdiction over ...


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