Assessing the Effectiveness of Organized Crime Control Strategies: A Review of the Literature
- 4.5 Seizure and Forfeiture of Assets
- 4.6 Injections, Divestitures and Trusteeships
- 4.7 Witness Protection Programs
- 4.8 Anonymous Juries
Money has been said to be the lifeblood of the drug cartels, enabling them to finance the manufacture, transportation, distribution, murder, and intimidation that are critical to their illicit activities (Beare, 1996:131). Operations to combat money laundering and to deprive such groups of the proceeds of crime can deprive them of this key flow of money. The forfeiture of assets obtained through crime also is said to remove the incentive from engaging in unlawful behaviour (Lyman and Potter, 1997:419). Furthermore, the forfeiture of assets—amounting to about $500 million a year in the US--can finance the prevention and control of organized and other crime (Abadinsky, 2003:323). It can also (at least theoretically) mitigate the damage to the economy occasioned by the large volumes of untaxed profits in the illicit marketplace (Albanese, 1996:226).
Seized and forfeited items can include cash, buildings, land, motor vehicles, and airplanes (Stahl, 1992). Forfeiture laws can pertain to assets that facilitate criminal conduct (e.g., cars used in smuggling, houses used to store contraband) and/or those that are the proceeds of crime. The forfeiture of crime proceeds can be quite complex as the government must prove the ownership of property and trace it to criminal behaviour. This latter task becomes more difficult when individuals keep converting the proceeds into different forms (Abadinsky, 2003:323).
Forfeiture has been criticized on the grounds that innocent parties have been harmed and that forfeiture laws have often been applied to low-level criminals. Innocent parties can include joint tenants, business partners, lien holders, and purchasers who have not been informed that a property subject to forfeiture proceedings was used in, or derived from, the criminal activity of others. In addition, these laws have been said to turn due process on its head (Abadinsky, 2003:326). Civil forfeiture proceedings, for example, are directed against property (independent of any criminal proceeding) alleged to have been used in criminal activity. In the American context, these proceedings require only that the government show probable cause that the property was implicated in criminal activity. The burden shifts to the property owner who must show by a preponderance of the evidence that this was not the case (Albanese, 1996:228).
Another objection to forfeiture is that the assets taken are often shared by law enforcement agencies, creating an incentive for these agencies to target the most wealthy, rather than the most dangerous offenders (Naylor, 2000).
Yet another concern centers around the storage and disposition of seized and forfeited assets. The most commonly seized assets are cash and cars, followed by boats, planes, jewelry, and weapons. Residential and commercial property is seized less frequently, but tends to have a higher monetary value (Albanese, 1996:230). Once assets are seized, they must be appraised and then stored and maintained, while ownership and third party claims are heard in court. In the event of a successful forfeiture proceeding, the property must be disposed of. Storage and maintenance can be profitable, but can also be costly. The disposal, too, may be difficult as no buyer may be found for a certain item. The US Marshal’s service has over 200 employees assigned to handling assets seized by federal agencies and the US Custom’s Service has more than 100 full-time paralegals to manage seized property (Albanese, 1996:230).
According to Beare (1996:171), the Canadian Proceeds of Crime legislation was not initially accompanied by measures to manage seized assets. She asserts that,
"Unfortunately, no adequate provision was made for the management and maintenance of the goods seized by police." The challenges and liabilities involved in the seizure of certain properties were illustrated by the RCMP’s seizure, in 1990, of the Ski-Montjoie facility in Quebec. Police investigations indicated that this resort was owned by drug traffickers who purchased it with money laundered through Switzerland. At the time of seizure, its market value was approximately $4.5 million. However, the government faced creditors whose claims totaled $2.5 million. Also, it had difficulty selling the property as land values in the area declined following the seizure (Beare, 1996: 171).
It became apparent that law enforcement agencies were not equipped to deal with property management and, hence, in 1993, The Seized Property Management Act was introduced to authorize the federal government to manage seized property and to dispose of it when forfeiture is ordered by the courts. A directorate was formed to carry out these and related tasks within the Department of Public Works and Government Services Canada.
There have been a number of high-profile seizures of property in Canada since the Proceeds of Crime legislation was introduced. One of the largest resulted from a drug investigation involving the RCMP, Vancouver Police Department, and the US’ Drug Enforcement Administration. More than $15 million in property—primarily vessels and real estate—was seized in British Columbia and $57 million in property was seized in the US (Beare, 1997:122). From 1989-1993, Canadian police have seized assets of drug-related crimes totaling $72 million (Canadian Association of Chiefs of Police, 1993).
Over the last 12 years, the Canadian government has implemented various strategies to combat money laundering and to confiscate the proceeds of crime. In 1992, the Integrated Anti-Drug Profiteering (IADP) initiative was introduced. Three multi-jurisdictional investigative units were established. Based in Canada’s three largest cities, these units comprised the RCMP, provincial, and municipal police personnel, Department of Justice counsel, and forensic accountants from Revenue Canada-Customs. Annual evaluations indicated that the integrated approach improved drug-related investigations and prosecutions (Gabor, 1994); hence, the project was expanded to 13 units that were now mandated to target a whole range of enterprise crimes (Department of Justice Canada, 2000).
No comprehensive, systematic evaluation of the forfeiture strategy has been undertaken. A Department of Justice Canada (2000:3) report indicates that,
"Adequate information on resource utilization and costs, as well as long-term impacts on organized crime was not available." The evidence that is available, however, suggests that proceeds of crime prosecutions tend to be complex and time consuming. Gibbon (1994), for example, reports on two cases in 1994 that took four years to develop.
In the United States, forfeiture laws at the federal level have not been applied until quite recently. Between 1970 and 1980, the Rackateer Influenced Criminal Organization (RICO) and Continuing Criminal Enterprise (CCE) provisions were used in just 98 drug cases and assets forfeited amounted to only $2 million (Albanese, 1996:227). This record is poor when it is considered that more than 5,000 Class 1 violators were arrested by the Drug Enforcement Administration in that decade. These statutes were also designed to combat the infiltration of legitimate businesses by OC; however, an audit by the General Accounting Office revealed no forfeiture of
"significant derivative proceeds or business interests acquired with illicit funds" (Albanese, 1996:227).
The Organized Crime Drug Enforcement Task Force Program (OCDETF) was established in 1983 in the United States. The 13 task forces around the US involve 10 federal, as well as state and local agencies. In the first two years of operation, the task forces had seized $52 million in assets in cases involving 1,408 offenders (Albanese, 1996:227). By the end of 1990, federal law enforcement agencies had seized $1.4 billion in cash and property. In 1991, the Drug Enforcement Administration seized property valued at $956 million (Bureau of Justice Statistics, 1992). Also, in 1992, several states reported forfeitures that exceeded the seed money used to generate them by ratios of 6:1 (Lyman and Potter, 1997:420).
Notwithstanding these and other enforcement efforts, the General Accounting Office asserts that their impact is unknown due to insufficient experience with the application of forfeiture laws (Albanese, 1996:227). Furthermore, the President’s Commission on Organized Crime (1986:345) has noted that the reliability of information on the seizure of non-drug assets is undermined by double counting, decentralization, and variations in data gathering methods. According to a study cited by the Commission (Stellwagen, 1985), more than one-half of state and local officials could not estimate the value of confiscated property. The determination of the value of such property is an essential part of an overall analysis of the benefits of forfeiture laws.
Levi (1997: 12-13) argues that the UK experience shows that the proportion of crime proceeds confiscated is miniscule—far less than one percent by his calculations—because major criminals are often not convicted, forfeiture proceedings may be unsuccessful, and offenders may spend much of their proceeds, leaving them with far fewer assets than profits from crime.
An evaluation of the Australian experience also illustrates the limitations of forfeiture laws. Freiberg and Fox (2000) begin by pointing out that the determination of the deterrent effects of these laws is complex, as the effects of forfeiture must be disentangled from the effects of the sentence imposed for the predicate offence. The authors note that, in Australia, only 10 percent of all convictions are on indictable offences—the remainder are summary convictions—and only indictable offences can serve as the basis for confiscation applications. Thus, a significant proportion of crime proceeds acquired in the commission of federal offences is not recoverable via the proceeds of crime legislation in that country. Just over 10 percent of cases involving indictable offences—1 percent of all offences--are subject to a confiscation order.
In Australia, assets confiscated under the proceeds of crime legislation average between A$10 and A$13 million per year (Freiberg and Fox, 2000:250). When one considers that the proceeds of crime have been estimated to be as high as $9 billion a year, well under one percent of crime profits are forfeited. The authors, as well as other commentators in Australia, assert that this record reflects a low level of enforcement of confiscation laws and a minimal incapacitation effect on crime.
Furthermore, just a minority of the forfeitures involved persons affiliated with OC groups. The authors cite a study in Germany indicating that there, too, the most common forfeitures involve drugs or assets used in offences by consumers or small-scale dealers, rather than members of OC groups (Benseler, 1997). Further undermining the effects of forfeiture laws is the gap between confiscation orders and assets actually recovered. In the UK, less than one-quarter of the funds ordered to be confiscated between 1987 and 1993 were actually recovered (Levi and Osofsky, 1995:3). In Australia, the amount realized by pecuniary penalty orders and forfeiture orders was 28% of the value of restraining orders (Freiberg and Fox, 2000:253). As for the costs of confiscation, the Australian experience indicates that, at the federal level, the efforts are marginally profitable, as it is estimated that it costs roughly $75 to recover $100.
The Australian study identified a number of impediments to the success of forfeiture laws (Freiberg and Fox, 2000:259-260):
- both in Australia and abroad, forfeiture is not viewed as a core function by law enforcement agencies;
- coordination within and between agencies is lacking;
- expertise is lacking in what is viewed as a highly technical and peripheral aspect of policing;
- other than in those jurisdictions (primarily the US) where agencies can retain a percentage of the confiscated assets, little incentive exists to pursue the long and expensive forfeiture proceedings;
- courts are often hostile to forfeiture legislation, interpreting these laws very strictly due to their perceived intrusion upon basic rights (e.g., their frequent reversal of the burden of proof).
Whereas asset forfeitures remove the racketeer’s ill-gotten gains, the federal system in the US and other jurisdictions have civil remedies designed to eliminate the influence exerted by OC figures in legitimate businesses, unions, and other organizations (Giuliani, 1986:111). Under the RICO legislation in the US, court injunctions may require defendants to divest themselves of interests in tainted enterprises, may impose reasonable restrictions on the future activities and investments of an individual, and may order the dissolution or reorganization of any enterprise (Giuliani, 1986:111). While little information exists regarding the frequency with which these provisions have been used, Giuliani notes that that they have been used very infrequently.
Some labour unions, for example, have historically been dominated by OC. While prosecution has been unsuccessful in remedying the problem of these captive unions, court-ordered trusteeships have re-established democratic processes and thereby freed the union of labor racketeering. One of the best known cases involved Local 560 of the International Brotherhood of Teamsters in New Jersey (Goldstock, 1994:435). In this case, the district court granted broad permanent injunctive relief whereby the court enjoined two defendants from
"any further contact of any kind" with the union and removed the union’s entire executive board in favour of a trustee whose responsibility it was to ensure fair elections (Giuliani, 1986:112). In other cases, such remedies have been used to deal with racketeering in the hospitality and cement industries.
While systematic evaluations, including the costs of pursuing court injunctions, are absent in this area, Giuliani (1986:112) has been a strong proponent of these remedies. He asserts that they are a powerful tool for permanently dissolving criminal organizations and for preventing the infiltration of legitimate businesses by OC figures. He views these remedies as especially crucial in industries that have been particularly vulnerable to OC penetration. Giuliani notes that the incarceration of an OC lieutenant may disrupt operations but does not put the enterprise out of business. So long as OC’s property remains, new leaders will replace those that have been imprisoned. These legal tools, according to Giuliani (1986:112)
"have the power to permanently divest organized crime of its corrupt economic base."
These programs are designed to protect witnesses who testify in cases involving OC. They provide for the health, safety, and welfare of these witnesses, as well as their families. Such programs may involve the relocation of witnesses and their families, and the provision of new identities and jobs. In the United States, the program has stretched resources, as the number of individuals protected by the program has been far in excess of that anticipated. By the end of 1996, 6,500 witnesses and 15,000 dependents had entered the program (Sabbag, 1996). The annual cost exceeds $25 million, well in excess of the original estimate of less than $1 million (Albanese, 1996:193).
A major criticism of such programs is that they provide career criminals with
"clean" backgrounds that they can use to prey on an unsuspecting public (Abadinsky, 2003). This is especially a concern as the allowance provided by these programs tends to be far more modest than the income these individuals can typically generate from crime. There are many documented cases of witnesses committing major crimes with the help of their new identities (Abadinsky, 2003:335). Another serious concern is that estranged spouses of those protected by the program have encountered difficulties visiting and maintaining a relationship with their children (Tulsky, 1987). Furthermore, the US Department of Justice does not always receive the cooperation of other federal agencies in obtaining military records, social security cards, medical records, and other documents (Rhodes, 1984:183; Mathews, 1990).
Rhodes (1984) asserts that the US program is largely tailored to career criminals and may not serve non-offenders as well. He describes a case in which a New York City businessman, upset with his brother’s narcotics addiction, testified against OC figures with whom he had some legitimate contact. His information helped obtain the conviction of several racketeers and his courage was rewarded by advice provided by officials from the Witness Protection Program that he ought to hastily sell his lucrative business and home, and relocate to Texas. He was also advised to terminate any direct contacts with friends and relatives. The witness eventually committed suicide. This story and others like it suggest that there may be fewer incentives for non-criminals to participate in witness security programs (Mitchell, 1981). Many witnesses find the process of changing their identities and concealing their past highly stressful (Montanino, 1984: 503).
These programs do, however, appear to afford protection. From 1961-1965, prior to the establishment of the US program, the US Department of Justice lost more than 25 informants in OC cases (Kelly, Schatzberg, and Chin, 1994: 497). Hundreds of other prosecutions were stymied because witnesses feared for their lives. While about 30 witnesses who have left the US program have been murdered, none following program guidelines have met this fate (Sabbag, 1996). (Another source indicates that a protected witness in a drug case was murdered in Arkansas (Mitchell, 1981)). The program boasts a 97 percent success rate in protecting witnesses under supervision (Lyman and Potter, 1997:433).
Montanino (1990:127) asserts that,
"Of all the [US] government’s strategies for combating serious criminality, the Federal Witness Security Program has been the most successful." Giuliani (1986:115) adds that, since the program was established in 1970, virtually every major racketeering prosecution has benefited from the testimony of one or more protected witnesses. The US program has facilitated major defections from La Cosa Nostra (Jacobs and Gouldin, 1999). Until the 1980s, the only major OC figure who had broken the code of omerta was Joe Valachi. In the late 1980s and early 1990s, a number of mob figures facing the possibility of lengthy prison terms testified for the government in exchange for concessions in the charges against them and admission into the Witness Security Program.
Jacobs and Gouldin (1999:168) provide a list of high-profile mob figures who "flipped" and entered the program. These individuals helped the government in its civil racketeering suit against the Teamsters Union, and provided testimony in the "Commission", "Pizza Connection", and other prominent cases. In one of the most notorious cases, Gambino family underboss Salvatore Gravano testified against powerful John Gotti, head of that crime family. Kenney and Finckenauer (1995:333) assert that Gotti’s conviction might not have occurred without Gravano’s testimony and that,
"There is no doubt that his [Gravano’s] cooperation would not have been secured except under a guarantee that he and his family would be protected from retaliation by Gotti and his followers."
Kelly, Schatzberg, and Chin (1994:500) report that the record of the United States’ Witness Protection program is impressive. They note that protected witnesses have helped convict over 89 percent of the defendants against whom they testified.
A 1984 study by the United States’ General Accounting Office revealed a 75 percent conviction rate in cases involving the testimony of a protected witness (Albanese, 1996). The majority, but not all, of the defendants were OC figures. The GAO found that, in OC cases involving protected witnesses, twice as many defendants received prison sentences than in other OC cases. Eighty-eight percent of those designated as bosses or ring leaders were sent to prison, for a median time of 11.2 years. The GAO further found that just over 21 percent of witnesses admitted into the US program were arrested within the next two years. This figure may be modest in light of the fact that the typical protected witness has over seven arrests prior to their entry into the program. In addition, supervision by the US Marshal’s Service may increase the likelihood of detection for criminal activity (Giuliani, 1986:116).
Albanese (1996:195) notes that the significant OC prosecutions resulting from the program must be weighed against the $25 million cost, the arrest rate of protected witnesses, and the occasional lawsuit filed against the government due to the criminal actions of a witness. He points out that the high cost of the program has brought increasing attention to easing witnesses out of the program, although this poses a challenge in the case of older individuals and those who have never held a legitimate job.
Overall, it is difficult to determine the extent to which the increased testimony by OC insiders in the last two decades was due to witness protection, as opposed to the reduction of charges, immunity, and the erosion of adherence to codes of secrecy by the more recent generation of OC figures.
In Canada, until 1995, witness protection programs were run by several police forces, including the RCMP (Ha, 1995). In 1995, the government tabled a bill to establish a national program. This review did not uncover any evaluation of any of these programs. Beare (1996:194) states that the current version of the program is under-funded and lacks
"the infrastructure of training, support services, and policies needed to support the Canada-wide operation." For example, Canada lacks the facilities to house informers who are incarcerated, especially at the provincial level and in the case of women.
The RCMP’s program costs over $3 million and protects 80-100 witnesses at any one time. About half of these witnesses have provided testimony in relation to OC cases. As with the American program, a number of lawsuits have been filed against the RCMP for allegedly failing to provide adequate protection for witnesses and their families, and for failing to provide new identities (Ha, 1995).
The United Kingdom, too, has no national witness protection program; however, an increasing number of police forces have established specialized units to protect witnesses (Fyfe and McKay, 2000). Witness relocation tends to be an option for just those witnesses facing the highest level of danger. An evaluation of the Strathclyde program in Scotland revealed that the average cost per case was considerably lower than other British programs-$6,000 as opposed to $20,000-$100,000. This difference was attributed to variations in the length of time witnesses spend in temporary accommodations, variations in benefits, and the more expeditious processing of cases in Scotland.
Police officers, prosecutors, and defence advocates tended to agree that such programs are invaluable, especially in certain types of cases (e.g., drug-related), where the presence of forensic evidence means that witness intimidation is one of the few avenues available to the accused and co-defendants to weaken the prosecution’s case (Fyfe and McKay, 2000:289). Prosecutors noted that, without such programs, witnesses had often chosen to accept the penalties of not testifying rather than risk serious injury.
These professionals noted some concerns with these programs (Fyfe and McKay, 2000). One concern was that some witnesses, wishing to be relocated, would falsely claim that they were being threatened. Another concern was that relocation would not work, as protected witnesses would eventually return to their home area. Defence counsel were apprehensive about the prejudicial effect on the image of defendants of indicating in court that the witness had entered a witness protection program.
Witnesses interviewed in the Strathclyde study reported facing such incidents as having their house gas-bombed, having a shotgun to their head, being run over by a car, and receiving threats to their children. While many were relieved to learn about the possibility of being relocated, they were anxious about the impending loss of contact with family and friends. At this stage, some witnesses decide against relocation, while others feel they have no option. Generally, witnesses who were relocated felt more secure, but continued to experience anxieties and anger. The protected witnesses who testified in court (some were not compelled to give evidence due to changes of plea) had praise for their treatment. They were escorted to and from court and sat in separate waiting rooms from the other attendees.
Giving their evidence was a stressful event, as friends of the accused made intimidating gestures. Also, many of these witnesses faced aggressive questioning by defence counsel. Often, their motives were questioned and the suggestion was made that they were being rewarded for their testimony by being relocated. Many left court feeling angry and confused.
The majority (10 of 14) of the cases in which the interviewed witnesses testified resulted in a conviction. In the long term, anxieties about personal security persisted, especially following the release of the person against whom the witness testified. Over time, as well, many witnesses report becoming increasingly isolated from family and disenchanted with their new life. They note the importance of long-term psychological support.
Safety issues are a concern for other courtroom actors; i.e., prosecutors, judges, and jurors. Prosecutors and judges have been protected by bodyguards and have even been temporarily relocated during OC trials (Giuliani, 1986:116). Jurors, too, have faced threats and harassment, as well as been on the receiving end of corrupt offers. Various jurisdictions in the US allow for the empanelment of anonymous juries. In such cases, prospective jurors are ordered to withhold all personal information which would reveal the juror’s identity.
Successful applications for an anonymous jury have been supported by sworn statements detailing the violent nature of the crimes alleged, the defendant’s history of violence, specific threats or corruption by the defendants involving courtroom actors, and the anticipated publicity surrounding the case (Giuliani, 1986:117).
Objections to anonymous juries have been two-fold:
- The failure to disclose the names and addresses of jurors deprives the defence of information necessary to mount a successful challenge; and,
- The empanelment of an anonymous jury undermines the presumption of innocence by suggesting that the defendants are dangerous and are likely to intimidate jurors or offer bribes to them.
In addressing the first objection, Giuliani (1986:117) argues that a defendant has no inherent right to information about the name, address, or place of employment of a prospective juror. Such information is not critical to launching intelligent challenges. Individuals can indicate their area of residence and their occupation and still reveal information about their socioeconomic status without providing an address and place of employment. In addition, judges can screen prospective jurors for possible bias.
With regard to the second concern, that an anonymous jury undermines the presumption of innocence, Giuliani argues that instructions by the court explaining that anonymity is designed to prevent interference by outsiders should be sufficient. Also, the courts have consistently upheld orders protecting the anonymity of witnesses and have therefore not deemed that such orders would deprive the defendant of a fair trial. In fact, those serving on a jury in an OC trial and who are afraid because they have not been protected by anonymity may demonstrate more bias in their judgment.
This review has not uncovered any empirical evidence comparing the decisions rendered by anonymous versus other juries in similar OC cases. A study could evaluate whether jury anonymity affects conviction rates or increases the likelihood of successful appeals.
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