Non-CAFRA Merchandise Forfeitures

The term “non-CAFRA” refers to forfeiture cases not governed by the Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”), which is codified, in part, in 18 U.S.C. § 983.

When CAFRA was enacted, however, Congress expressly excluded the Customs laws codified in Title 19 of the United States Code. See 18 U.S.C. § 983(i)(2)(A).

What are non-CAFRA proceedings? Seizures under Title 19 of the United States Code are commonly called the “Customs Carve-Out” provisions since CAFRA does not apply to these seizures and forfeitures. In these cases, the “notice of seizure” letter from Customs will use the term “non-CAFRA.”

Under section 1595a of 19 U.S.C., “[m]erchandise which is introduced or attempted to be introduced into the United States… may be seized and forfeited if… its importation or entry is subject to any restriction or prohibition which is imposed by law relating to health, safety, or conservation and the merchandise is not in compliance with the applicable rule, regulation, or statute.” 19 U.S.C. § 1595a(c)(2)(A).

Where “merchandise may be seized and forfeited,” Customs may instead “deny entry and permit the merchandise to be [re]exported.” 19 C.F.R. § 151.16(j). Additionally, United States Customs and Border Protection (“CBP”) Officers might identify the merchandise as not classified properly when it entered the United States.

Some types of contraband are tagged for further inspection by the Commercial Targeting and Analysis Center, the CBP Agriculture Specialists Enforcement Team, or an FDA Compliance Officer (“FDACO”).

Attorney for Non-CAFRA Seizures and Forfeitures

If CBP seized your property, merchandise, vehicle, or vessel, contact an experienced civil asset forfeiture attorney to discuss the case. In a non-CAFRA forfeiture case, we can help you file a verified claim and post the cost bond.

Filing the claim triggers a deadline for CBP to return the property or convince an Assistant United States Attorney (AUSA) to file a complaint in the appropriate district court.

If Customs fails to follow the rules, we can help you file a complaint for the return of the property or a motion for a preliminary injunction to begin the judicial forfeiture proceedings.

Talk to an attorney before you consider pursuing any of the less desirable administrative remedies outlined in the CBP’s Non-CAFRA notice letter. Those administrative actions include filing a petition for remission or making an offer in compromise.

Act quickly to ensure your rights are protected by filing the claim correctly.

Call 813-250-0500.

Seizure of the Imported Merchandise by CBP

If CBP Officers inspect the shipment, they might discover contraband during the inspection.

CBP might then exercise its authority to seize and forfeit the property. In some cases, CBP uses a CBP Import Specialist to appraise the domestic value of the property.

CBP will investigate the importer of record to see when and where the company was organized or incorporated and whether other issues have arisen on forms for Entry/Immediate Delivery (CBP Form 3461) filed on behalf of the company.

Notice of the Administrative Seizure of Property

In administrative proceedings, CBP’s Office of Fines, Penalties, and Forfeitures might send notices of seizure to the company and the named representative of the company. The notice of seizure gives the following options:

1. file a remission petition;
2. submit an “offer in compromise” and include a check of the proposed settlement amount along with the offer;
3. abandon any interest in the property;
4. request court action and have his case referred to the U.S. Attorney for the institution of judicial forfeiture proceedings;
5. do nothing; or
6. offer to substitute the release of the seized property on payment.

The notice of seizure might allege that the property is subject to forfeiture to the United States under:

1. Title 19, United States Code, Sections 1595a(c)(l)(A) & (2)(A) if the product is not in compliance with Title 21, United States Code
2. Title 19, United States Code, Sections 1584(a);
3. Title 19, United States Code, Sections 1499(c)(4); and
4. Title 21 United States Code, Section 331(a), a health, safety, or conservation statute.

Additionally, the merchandise might be seized under Title 19, United States Code, Section 1595a(c)(1)(A) if the CBP agent has probable cause it was “smuggled or clandestinely imported or introduced” in violation of:

• Title 19, United States Code, Section 1481 (invoice);
• Title 19, United States Code, Section 1484 (entry of merchandise); or
• Title 19, United States Code, Section 1485 (declaration).

The cases often start with Import Alerts directing federal officials to detain the product without physical examination.

How to Contest the Seizure in a Judicial Forfeiture Action

After the seizure, the company will receive a Notice of Seizure and Non-CAFRA Form. The notice explains that the company can contest the seizure in a judicial forfeiture action initiated by the government.

To do so, the Non-CAFRA Notice of Seizure instructs the company to “submit to CBP . . . a claim and cost bond in the penal sum of $5,000 or 10 percent of the value of the claimed property, whichever is less.”

When a verified claim is filed on behalf of a company or LLC, the owner and member of the company, the owner of the property seized by the Government, and the defendant In Rem, file a claim on behalf of the company that describes the property seized.

Upon filing a claim and bond, the Non-CAFRA case is “referred promptly to the appropriate U.S. Attorney for the institution of judicial proceedings in Federal court to forfeit the seized property in accordance with 19 U.S.C. § 1608 and 19 C.F.R. § 162.47.”

Upon receipt of the case, the U.S. Attorney “must either seek civil judicial forfeiture of the goods in federal court or decline to do so (in which case the goods are returned to the claimant).” LKQ Corp. v. United States, No. 18-CV-1562, 2019 U.S. Dist. LEXIS 122343, 2019 WL 3304708, at *2 (D.D.C. July 23, 2019) (citing 19 U.S.C. § 1608).

Problems with Filing a Petition for Remission

A petition for remission offers an expedited administrative procedure to contest the forfeiture. The remission proceedings give the Government and the claimant a way to resolve a dispute informally rather than in judicial forfeiture proceedings.

The petition for remission allows the claimant to explain why he believes he warrants relief from forfeiture. Testimony may be taken in connection with a remission petition. 19 U.S.C. § 1618.

The notice of seizure in these cases also provides that if the claimant is dissatisfied with the petition decision or at any point before the forfeiture of the property, he may request a referral to the U.S. Attorney for judicial action by filing a claim and cost bond.

In other words, even if a party initially files a petition for remission under 19 U.S.C. § 1618, the importer “at any time” can opt out of the administrative petition process and challenge the seizure in a judicial forfeiture proceeding instead by following these procedures. See id.

Be aware that the petition for remission often delays the case resolution for months. If you are contesting the legality of the taking, then you should immediately file the claim for court action instead of filing a petition.

Filing a Cost Bond Under 19 U.S.C. § 1608

Any person may file a claim under § 8.10(a) without posting a cash bond, except in non-CAFRA forfeitures under statutes listed in 18 U.S.C. 983(i).

In the nonjudicial civil proceedings against the vessel, however, the Claimant must file a verified claim and deliver a cost bond to fulfill the requirements of 19 U.S.C. § 1608 to request judicial action.

19 U.S. Code § 1608 provides that:

Any person claiming such vessel, vehicle, aircraft, merchandise, or baggage may at any time within twenty days from the date of the first publication of the notice of seizure file with the appropriate customs officer a claim stating his interest therein.

Upon the filing of such claim, and the giving of a bond to the United States in the penal sum of $5,000 or 10 percent of the value of the claimed property, whichever is lower, but not less than $250, with sureties to be approved by such customs officer, conditioned that in case of condemnation of the articles so claimed the obligor shall pay all the costs and expenses of the proceedings to obtain such condemnation, such customs officer shall transmit such claim and bond, with a duplicate list and description of the articles seized, to the United States attorney for the district in which seizure was made, who shall proceed to a condemnation of the merchandise or other property in the manner prescribed by law.

The bond serves to “deter those claimants with frivolous claims” and “to cover the costs and expenses of the proceedings.” Arango v. U.S. Dep’t of the Treasury, 115 F.3d 922, 925 (11th Cir. 1997). “If the outcome of the judicial proceeding is in the claimant’s favor, the bond is returned.” Id. (citation omitted).

To ensure that the bond requirement does not deny indigent claimants an opportunity to contest the forfeiture in court, CBP provides by regulation that the bond requirement shall be waived “upon satisfactory proof of financial inability to post the bond.” 19 C.F.R. § 162.47(e).

The notice of seizure explains that if the claimant cannot afford to post the bond, he should contact the Fines, Penalties and Forfeitures Officer for CBP to determine the claimant’s financial ability to pay:

“If a determination of inability to pay is made, the cost of the bond may be waived in its entirety.”

This article was last updated on Friday, January 6, 2023.