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Bay Area Estate And Tax Planning Law Firm
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Asset forfeiture case stands as example for business owners

| Jul 22, 2015 | Uncategorized |

Thanks to media coverage over the last few months, civil asset forfeiture is no longer an unknown term. Many Americans are now aware of this process by which government agencies are allowed to seize assets from an individual even if they are never charged with committing a crime.

In a lot of states across the nation, including here in California, civil asset forfeiture laws have sparked concerns as well as anger. This is particularly true among business owners who are concerned by the ease in which the government has taken assets from individuals and businesses in the past. This concern persists despite an announcement from the IRS last year indicating changes to how it reports possible seizures to the government.

For those who are unfamiliar with asset forfeiture cases, we’d like to direct your attention to the case of Lyndon McLellan, a business owner who was forced to stand by and watch as the IRS seized $107,000 of his business’ assets. The IRS claimed that the seizure was in response to frequent deposits he had made that the agency believed to be a way of “structuring” — a practice by which an individual or business attempts to hide larger deposits by breaking them into smaller ones so as to avoid the scrutiny of the IRS.

Despite the IRS’ assurance that similar cases will not be pursued unless further evidence of criminal activity is also discovered, this case, and others like it, will continue to stand as a lesson for business owners across the nation. These cases teach us how even innocent activity can look criminal to some, further necessitating the need for a skilled attorney when legal issues do arise.

Source: The Washington Post, “How the IRS seized a man’s life savings without ever charging him with a crime,” Christopher Ingraham, May 15, 2015

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