What Happens to the Proceeds from Forfeitures in Florida?

The Florida Contraband Forfeiture Act (FCFA) governs forfeitures under state law. What happens to the property after a final judgment of forfeiture is entered by the court? Under Section 932.7055, F.S., after the court signs the final judgment of forfeiture, the agency that seized the property may do any of the following:

• retain the property for the seizing agency’s use;
• sell the property at a public auction or by sealed bid to the highest bidder; or
• salvage, trade, or transfer the property to any public or nonprofit organization.

When the seizing agency is a county or municipal law enforcement agency, the forfeiture proceeds are deposited into a special law enforcement trust fund. Under Section 932.7055(5)(a), F.S., those funds may be used to fund any of the following:

• school resource officers;
• crime prevention programs;
• safe neighborhood programs;
• drug abuse education and prevention programs; or
• defraying the cost of protracted or complex investigations;
• providing additional equipment or expertise;
• purchasing automated external defibrillators for law enforcement vehicles; and
• providing matching funds to obtain federal grants.

Section 932.7055(5), F.S., prohibits the proceeds from a forfeiture being used to meet the normal operating expenses of a law enforcement agency.

Section 932.7055(6), F.S., requires that when the seizing agency is a state agency, the proceeds from forfeitures are deposited into the General Revenue Fund.

Some agencies have a trust fund designated to receive the proceeds from a forfeiture. Those agencies with a special trust fund might include:

• the Florida Department of Law Enforcement
• a state attorney’s office
• a school board security agency that employs law enforcement officers; and
• the State University System police departments.

Attorney for Civil Asset Forfeitures in Tampa, FL

If your property was seized for forfeiture, act quickly to retain an experienced civil asset forfeiture attorney in Tampa, FL. We represent clients throughout the state. We can help you demand an adversarial preliminary hearing (APH) and file a verified claim for court action.

We examine how law enforcement agencies dispose of seized property in forfeiture actions to determine whether they comply with Florida law. We also fight for the reform of civil asset forfeiture laws.

Call 813-250-0500.

How Forfeiture Proceeds are Distributed under Florida Law

Section 932.7055(4) requires the proceeds from the sale of forfeited property must be disbursed in the following priority:

• if the forfeited property is subject to a lien, the agency must first sell the property and use the proceeds to satisfy any liens or may have the lien satisfied before taking any other action;
• pay the cost incurred by the seizing agency in connection with the storage, maintenance, security, and forfeiture of such property;
• pay the court costs incurred in the forfeiture proceeding.

If the seizing agency is a state agency, any remaining proceeds must be deposited into the General Revenue Fund, except some state agencies are exempt from this requirement. Instead, those exempted agencies can deposit the proceeds into specified trust funds created within those agencies.

Effective July 1, 2024, the Florida legislature amended Section 849.19, F.S., to allow the Florida Gaming Control Commission’s Division of Gaming Enforcement (DGE) to seize property and use the proceeds after the forfeiture to be deposited into the Pari-Mutuel Wagering Trust Fund—such proceeds may be used for the operation of the Florida Gaming Control Commission.

What Happens to Civil Asset Forfeiture Funds – Examples of Corruption

When discussing the allocation of proceeds from civil asset forfeiture in Florida, examples of outright corruption should not be overlooked. For example, consider what allegedly happened to forfeited funds in the City of Hialeah Police Department. Most of the funds were reportedly stolen by the then Chief of Police, SERGIO VELAZQUEZ (11/11/1963), who is being prosecuted for several felony offenses in Case Court Number F-25-011216 in Miami-Dade County, FL, including:

• money laundering
• organized fraud
• grand theft
• official misconduct

Many of the details are explained in the arrest warrant as follows:

…this investigation found that currency from narcotics-related seizures and subsequent civil forfeitures was also missing and unaccounted for. More specifically, between calendar years 2016 and 2021, currency totaling over $1,000,000.00 from twenty (20) court-awarded civil forfeitures was also missing.

These funds were derived from successful forfeiture actions undertaken by the [City of Hialeah Police Department] (HPD) Legal Department. This currency was never submitted to the HPD property unit, instead held in a safe within VELAZQUEZ’s administrative suite pending culmination of the forfeiture proceedings.

Upon receiving court orders for disbursement of these funds, which included depositing a portion into the Law Enforcement Trust Fund (LETF), VELAZQUEZ was notified directly by HPD legal staff of the Court order. City of Hialeah Finance staff was unable to locate the missing forfeiture deposits. Additionally, this investigation analyzed the LETF account and the corresponding deposits were not found. HPD policy regarding currency seizures required all currency seizures to be submitted and maintained by the HPD property section. As will later be described, this policy was altered by VELAZQUEZ and all currency from seizures as well as HPD-SIS “petty cash” was held in a safe within VELAZQUEZ’S administrative suite, to which VELAZQUEZ had direct access to, including the combination…

For the purposes of this affidavit, the following activity conducted between December 21, 2020, and November 30, 2021, will be specifically described throughout this affidavit. In summary, this investigation has determined that:

• Nine (9) “petty cash” checks totaling $352,000.00 were issued and cashed to fund HPD-SIS investigations.
• Approximately $307,000.00 of that amount is unaccounted for.
• Approximately $526,000.00 in U.S. currency seized by HPD that was court-ordered to be deposited into the Law Enforcement Trust Fund was not deposited.
• Approximately $235,000.00 ordered by the court to be retained by HPD for investigative costs is largely unaccounted for.
• Over $76,000.00 in currency seized by HPD between August 24, 2021, and October 8, 2021, was found to be missing from the original evidence packages.

All told, over $1,100,000.00 in currency is missing and/or unaccounted for from HPD in 2021 alone.

During this same time period, your Affiant identified over 153 cash deposits totaling $293,060.00 that were made into accounts controlled by VELAZQUEZ while he was employed as the Chief of Police for the Hialeah Police Department.

Many of these cash transactions were structurally deposited into bank accounts owned and controlled by VELAZQUEZ. This deposit method was conducted in a manner that disguised the actual amount of currency being deposited, resulting in financial institutions failing to file Currency Transaction Reports (CTRs) pursuant to those transactions.

Additionally, the currency deposits were almost always followed by payments to various credit card companies to offset credit balances previously incurred. In fact, of the $293,060.00 in cash deposits made into bank accounts controlled by VELAZQUEZ in calendar year 2021, approximately $265,000.00 in payments were subsequently made to credit card accounts and other creditors of VELAZQUEZ.

Finally, VELAZQUEZ had no other significant cash deposit activity after October 29, 2021, approximately 10 days prior to being relieved of duty as Chief of Police of the Hialeah Police Department…

As will be described herein, between June 2, 2021, and October 29, 2021, VELAZQUEZ utilized his position as Chief of Police to gain access to currency belonging to the City of Hialeah and systematically defraud the City of “petty cash” and court-ordered civil forfeiture funds.

These funds were stored in a safe within VELAZQUEZ’S administrative suite, to which he had access and for which he held ultimate responsibility as Chief of Police.

During this time:

• Nearly $160,000.00 in “petty cash” went unaccounted for by the Hialeah Police Department (HPD).
• The whereabouts of court-ordered forfeiture funds totaling approximately $400,000.00 is unknown.
• Approximately $140,000.00 was then structurally deposited into accounts controlled by VELAZQUEZ, allowing him to use these funds as he desired….

The Investigation – Missing Forfeitures

In addition to petty cash, currency from HPD currency seizures made during SIS investigations was also placed in a safe. This practice was a deviation from HPD General Order 36.50 (L)(4) — issued on June 3, 2011, and still in effect — which requires that all currency seizures be submitted to the HPD Property Section.

Based on information obtained during sworn statements made in this case, the change in procedure was implemented by SERGIO VELAZQUEZ shortly after he became the Chief of Police.

During a sworn statement taken from HPD Lieutenant Daniel Perez, it was learned that Commander Hubert Ruiz had contacted Perez on two separate occasions regarding the combination to the currency safe. At the time, Perez was the Sergeant of SIS, and he stated that on both occasions — two different Saturdays — he intentionally changed the safe’s combination. Ruiz later called and demanded the new combination to access the contents of the safe. Perez complied with both requests and provided the new combination to Ruiz.

Additionally, Perez advised that HPD Lieutenant Orlando Salvat told him that he (Salvat) had confronted VELAZQUEZ about money missing from a currency seizure. According to Perez, VELAZQUEZ responded that he had taken the money from one money bag and placed it into another.

This is a clear indication that VELAZQUEZ had direct access to the seized currency Inside the safe, VELAZQUEZ either had direct access by knowing the combination or gained access through another individual who had the combination.

This investigation also revealed that money from currency seizures went missing after being placed in the safe.

During an interview with HPD Business Manager Johnerick Rojas, it was revealed that current HPD Chief George Fuente contacted him shortly after VELAZQUEZ was relieved of duty as Chief of Police in November 2021. Rojas stated that Chief Fuente noticed the safe in the office. After obtaining the combination from VELAZQUEZ, the safe was opened. Inside were evidence packages containing cash related to recent seizure/forfeiture cases. These packages were retrieved and taken to the property unit to be counted.

Rojas reported that when the cash was counted, tens of thousands of dollars were missing.

Rojas also advised that he would frequently be contacted by VELAZQUEZ to pick up money from forfeitures. According to Rojas, VELAZQUEZ would give him an envelope with cash, which Rojas would count, prepare a deposit slip for, and then take to the finance department to be deposited.

Rojas stated that he later became aware that HPD was using multiple seizure/forfeiture logs, after receiving an email from HPD Legal Secretary Delilah Fonseca. Fonseca provided Rojas with a seizure/forfeiture log used by the HPD Legal Department that was completely different from the log VELAZQUEZ had provided to Rojas for the Law Enforcement Trust Fund (LETF) yearly report.

During his interview, Rojas provided a copy of the HPD Legal Department’s log and explained that approximately twenty (20) cases listed—totaling approximately $1,174,670.00—had been closed for fiscal year 2020–2021.

Rojas stated that:

• He was unaware of any of those twenty closed cases;
• He was unaware of the corresponding seizure/forfeiture funds that were forfeited to HPD;
• Those funds were not processed by the property unit;
• The funds were not included in the LETF yearly report;
• Therefore, the funds were missing and/or unaccounted for.

Additionally, Rojas stated that about once a month, he would be contacted by VELAZQUEZ to write a memorandum to City of Hialeah Finance Director Chiocea, requesting money from the finance department and to be issued a check made payable to “Petty Cash – Hialeah Police Department,” for amounts up to $40,000.00. Rojas stated that he does not know what happened to the money after those checks were cashed.

Further analysis of HPD forfeiture records revealed that currency from fourteen (14) other forfeiture cases was also missing.

In summary:

• $526,712.00 in U.S. currency was ordered by the court to be deposited into the Law Enforcement Trust Fund (LETF) at the conclusion of fourteen (14) different forfeiture cases in 2021.
• An additional $235,562.00 was ordered by the court to be retained by HPD for investigative costs.

Although these court orders were conveyed to VELAZQUEZ through legal memorandums, the City of Hialeah Finance Department was unable to locate any records indicating that the LETF deposits were made.

Subsequent analysis of HPD LETF account bank records also failed to locate the required deposits.

This information will be explained further in this affidavit….

Furthermore, the whereabouts of proceeds from fourteen (14) civil forfeitures totaling $762,274.00 in U.S. currency seized by HPD is unknown. $526,712.00 of this amount was court-ordered to be deposited to the LETF and was not. This is in addition to $235,562.00 that the court ordered HPD retain as costs of their investigations.

Another $76,771.00 in currency seized by HPD between August 24, 2021, and October 8, 2021, was discovered to be missing from the original evidence packages stored in a safe within VELAZQUEZ’s administrative suite.

All told, over $1,100,000.00 in currency from calendar year 2021 is missing from HPD…..

[The arrest warrant then gives many examples of specific forfeiture cases during that time period, including the following:]

On January 28, 2021, HPD obtained an Order of Default and Final Judgement of Forfeiture for case #2020-24217 from Judge David C. Miller under court case #2020-021316-CA-01. This case involved the attempted purchase of two (2) kilogram of cocaine by suspects from HPD undercover officers on September 18, 2020. A review of HPD documents revealed $59,486.00 in currency was seized on that day.

On February 3, 2021, HPD Legal Advisor Barbara Govea authored a City of Hialeah memorandum instructing VELAZQUEZ: “Please have the seizing officer release the currency ASAP. Once that is done, $41,917.00 shall be deposited into the Law Enforcement Trust Fund – State account after $17,569.00 in costs of the complex and protracted investigation is reimbursed.”

After a diligent search, the COH finance department was unable to locate this deposit in the LETF-State Ledger and the finance department has no record of this cash ever being deposited into the HPD LETF.

On February 12, 2021, HPD obtained an Order of Default and Final Judgement of Forfeiture for case #2020-28830 from Judge Carlos Lopez under court case #2020-025359-CA-01. This case involved the attempted purchase of one (1) kilogram of cocaine by suspects from HPD undercover officers on November 5, 2020. A review of HPD documents revealed $38,100.00 in currency was seized on that day.

On February 16, 2021, HPD Legal Advisor Barbara Govea authored a City of Hialeah memorandum instructing VELAZQUEZ: “Please have the seizing officer release the currency ASAP. Once that is done, $25,854.00 shall be deposited into the Law Enforcement Trust Fund — State account after $15,547.00 in costs of the complex and protracted investigation is reimbursed.”

After a diligent search, the COH finance department was unable to locate this deposit in the LETF-State Ledger, and the finance department has no record of this cash ever being deposited into the HPD LETF.

On February 19, 2021, three (3) cash deposits totaling $9,600.00 were made into two (2) different accounts controlled by VELAZQUEZ. These deposits were conducted in a manner consistent with structuring activity. The total deposit activity was conducted on one day, into two (2) different accounts, and under the $10,000.00 reporting threshold.

This article was last updated on Thursday, January 16, 2025.