The disposition of forfeited property plays an integral part in fulfilling the goals of the Department of the Treasury Asset Forfeiture Program.

Property forfeited (currency, proceeds of any financial account, financial instruments, or proceeds from the sale of forfeited property) under 18 USC 981, 18 USC 982, and/or 31 USC 5317(c) may be:

See IRM 9.1.2.7.2, Title 18 Seizures for the delegated authority relating to IRM 9.7.8, Disposition of Seized and Forfeited Property.

The Director, Asset Recovery and Investigative Services is responsible for developing, maintaining, and overseeing this IRM and ensuring compliance with current policies and procedures.

The Director, Asset Recovery and Investigative Services will:

The Director, Asset Recovery and Investigative Services will review their program and ensure employee compliance with all applicable elements of this IRM.

The Director, Asset Recovery and Investigative Services will review the instructions and guidelines relating to all IRS documents for procedural, operational, and editorial changes.

The following table lists the acronyms and terms used throughout this IRM section and their definitions:

IRM 9.7.7, Claims and Petitions.

IRM 9.7.9, Equitable Sharing and Reverse Asset Sharing.

TEOAF Policy Directives website.

Seized currency, financial accounts, and financial instruments deposited into the TSA must be transferred to the TFF upon forfeiture. The TEOAF Form 2, Disposition Instructions for Currency Held in Treasury Suspense Account, is used to initiate the transfer of funds that have been forfeited from the TSA to the TFF. TEOAF Form 2 must be signed by the AFC and/or Asset Recovery and Investigative Services (ARIS) Management Program Analyst (MPA) and required documentation, such as Form 1570, Declaration of Forfeiture, or Final Judgment or Final Order of Forfeiture. TEOAF Form 2, with supporting documentation must be provided to ARIS headquarters (HQ-ARIS) for final processing to TEOAF.

The number of equitable sharing requests filed that relate to the forfeited funds must be included on the form in addition to seizure and forfeiture related expenses (e.g., advertising and any other specific asset related costs), award payments made by Treasury, and prior reimbursements.

TEOAF Form 2 is also used to instruct TEOAF to release funds on deposit in the TSA to the owner or third parties. A court order generally must accompany instructions to release these funds. If the funds are to be released because of a declination by USAO to pursue forfeiture or pursuant to a quick release or through the petition for remission or mitigation process, the associated letter and/or memorandum from the AUSA must accompany a concurrence memo from the SAC through the Director, ARIS, to the Director, TEOAF. These documents along with TEOAF Form 2 must be sent to HQ-ARIS for final processing to TEOAF.

TEOAF Directive 2, Seizures of Financial Instruments, sets forth procedures and responsibilities for handling financial instruments seized for forfeiture. Financial instruments include items such as, postal money orders, personal and cashier’s checks, certificates of deposit (CD), traveler’s checks, stocks, bonds, brokerage accounts. See the TEOAF Policy Directives website.

TEOAF Form 7, Request for Refund from Forfeiture Fund, is used to request a refund of monies that were previously forfeited and deposited into the TFF. TEOAF Form 7 must be sent to HQ-ARIS for final processing to TEOAF. Supporting documentation for the request must be included with the instructions.

CI initiates the disposition of seized and/or forfeited property by furnishing the seized property contractor with a U.S. Customs and Border Protection Disposition Form entitled “Custodial Contractor Property Disposition Form” on the ARIS AFTRAK SharePoint site.

The Disposition Order is signed by the responsible employee who is trained and certified as a Contracting Officer’s Representative or Designated Agency Representative (COR/DAR).

The seized property contractor will not act upon disposition orders received from any other entity. When directed by the COR/DAR, the seized property contractor will perform a disposition analysis to determine and recommend the most cost-effective disposition available to CI.

The COR/DAR may request that the seized property contractor dispose of seized property in one of the following ways:

The seized property contractor will remit seized property to the party designated, i.e., owner or third party, by the COR/DAR on the Disposition Order.

The seized property contractor will summarize all associated costs including holding or direct costs from the designated party. Direct costs include contracting fees, cost of transportation, storage, security, maintenance, and other miscellaneous charges attributable to a particular seizure. Approval to waive these direct costs is obtained in writing from the Director, ARIS on the Disposition Order. Approval from the Director, ARIS is necessary to waive any direct costs. The COR/DAR may not waive direct costs. The Disposition Order with the director's signature, approving waiver of the direct costs, will be sent to the seized property contractor.

The seized property contractor will:

Original Form 9573 must be returned to the COR/DAR upon disposition of the seized property.

The seized property contractor will release seized or forfeited property to CI when designated on the Disposition Order by the COR/DAR. The seized property contractor will obtain the signature on the Form 9573 of the individual designated on the Disposition Order. The original Form 9573 will be returned to the COR/DAR upon disposition of the property.

For forfeited property retained by CI or other participating TFF law enforcement agency, the seized property contractor will not collect associated costs.

The seized property contractor, upon request, will arrange for packing, crating, and shipment of forfeited property designated for official use.

The seized property contractor will release property to other (non-Treasury) federal agencies designated on the Disposition Order by the COR/DAR. The seized property contractor will collect from the recipient agency all associated costs including holding costs (direct costs of transportation, storage, security, maintenance, and other miscellaneous charges attributable to the particular seizure) as established by CI, before releasing the property unless approval to waive these costs is obtained by the COR/DAR from ARIS in writing on the Disposition Order. Approval from ARIS is necessary to waive the holding costs. The COR/DAR may not waive the holding costs.

The recipient agency will be required to pay all existing liens identified on the Disposition Order and show proof of payment before the property is released directly to the recipient agency.

The seized property contractor will arrange for packing, crating, and shipment of forfeited property designated for official use. The receiving federal agency will pay transportation and packing costs unless otherwise directed by the COR/DAR.

The seized property contractor will destroy seized and/or forfeited property as prescribed and directed by the COR/DAR on the Disposition Order. Property to be destroyed includes items unlawful to sell, items which constitute a safety hazard to the public, contraband, and forfeited items for which the seized property contractor's holding cost plus sales costs and overhead would exceed expected revenue.

Refer to the SOW for additional information regarding the destruction of property.

To ensure forfeited property is not sold to a criminal defendant or their agent, prospective bidders must complete and submit a bidder registration form to the seized property contractor. Completion of this form represents the bidder's certification that the bidder and/or the parties that the bidder is representing are not the individuals from whom the property was forfeited, and the bidder is not bidding for or on behalf of those individuals.

When selling property forfeited by CI, the seized property contractor may hold the purchased property for three days after providing the name of the purchaser to CI. The seized property contractor may release the forfeited property to the purchaser at the close of business on the third day following the sale if no further instructions have been received from CI.

TEOAF Directive 1, Restrictions on Purchase of Forfeited Property, prohibits Department of the Treasury employees and any members of their immediate family from purchasing property that has been forfeited and is being sold by the Department of the Treasury or its agents. This policy is intended to ensure that there is no actual or apparent use of inside information by employees wishing to purchase such property. The purpose of this policy is to protect the integrity of the asset forfeiture program.

If seized property is liable to perish, waste, or greatly depreciate in value during pendency of the forfeiture proceedings or if the expenses of keeping the property are excessive, the property may be sold and the proceeds of the sale treated as a substitute for the original property in the ensuing forfeiture.

As a general rule, seized property may be sold before forfeiture in two circumstances: a stipulated sale and an interlocutory sale. A stipulated sale occurs when all interested parties agree to the terms of sale and a district court approves the transaction. An interlocutory sale is ordered by the court and does not require agreement by all interested parties. This type of sale occurs when the seized property is "liable to perish or waste," is likely "to be greatly reduced in value by keeping" or "the expense of keeping the seized property is disproportionate to its value."

TEOAF Directive 27, Processing Interlocutory Sales, provides policy guidance to law enforcement agencies and the seized property contractor for interlocutory sales.

The seized property contractor may sell seized property pursuant to an interlocutory sale. The COR/DAR will provide the seized property contractor with the Disposition Order, along with a copy of the interlocutory sale order from the court.

The seized property contractor will clearly identify any deposit and full payment for seized property from the stipulated or interlocutory sale to be deposited into the TSA.

The seized property contractor will, upon receipt of the total net proceeds of the sale, and after deducting any payments for approved liens, taxes, mortgages, costs and legal fees associated with the closing, notify CI of the total net amount, identified as the "substitute res," so that the COR/DAR can notify the court and update AFTRAK. The seized property contractor will deposit the total net proceeds of the sale into the TSA.

The seized property contractor will plan sales on a continuing basis. Sale planning is designed to maximize net revenue by conducting timely sales, effectively managing the cost of sales, and by the use of other market techniques as needed. Pre-sale planning includes the evaluation of forfeited property for sale, selection of the most appropriate method and location for sale, and identification of actions needed to conduct a sale.

The seized property contractor will analyze forfeited property available for sale, schedule, market, advertise, and conduct sales in a way that maximizes and secures the greatest return to the government. The seized property contractor will operate a sales information program that provides accurate, timely sales information, including responses to all public inquiries concerning the time, place, and nature of all sales.

The seized property contractor will provide the catalogs describing the forfeited property to be sold to the COR/DAR prior to the sale.

Forfeited property is to be sold by the seized property contractor at public auction using competitive methods. Public auctions can be opened to prospective bidders in locations outside the local sale site by means of telecommunication or audio/visual networks.

The seized property contractor may use the following methods, further defined in the SOW, to sell forfeited property at public auction:

The seized property contractor will publicly advertise the sale of forfeited property in order to generate maximum competition and fulfill the legal requirements of 19 CFR 127.25, Advertisement of Sale.

The seized property contractor is required to respond by telephone or in writing to public inquiries regarding time, place, and nature of all sales.

The seized property contractor provides a subscription service whereby the public may purchase subscriptions to notices of all public sales.

The seized property contractor will ensure that all prospective bidders are given the opportunity to view, handle, and inspect all items designated for sale prior to any scheduled sale held at the contractor operated facilities and subcontractors' and vendors' facilities.

The COR/DAR must place a minimum bid or reserve bid amount on the Disposition Order directing the seized property contractor to sell the forfeited asset. The COR/DAR should consult with the seized property contractor who will provide their recommendations prior to setting a minimum bid on forfeited property. After obtaining input from the seized property contractor, the COR/DAR will indicate the minimum bid on the Disposition Order provided to the seized property contractor prior to sale or auction of the property.

The seized property contractor will not schedule a sale until the COR/DAR sets a minimum bid for the forfeited property.

The seized property contractor shall conduct all sales in accordance with the applicable government terms and conditions of sale. A detailed listing of the terms and conditions is located in the SOW.

Forfeited property offered for sale and not sold will be re-offered for sale at the seized property contractor's next regularly scheduled auction. The COR/DAR need not re-issue the Disposition Order for resale of unsold items. However, the COR/DAR needs to consider whether the minimum bid needs to be altered in consultation with the seized property contractor and/or ARIS.

The seized property contractor will prepare the formal transfer of documents for all conveyances sold to the public and forward the documents to the COR/DAR for approval. These documents, issued to the purchaser at the time of sale, will enable the seized property contractor to transfer title to the property from the government to a private entity.

The SAC has the authority to sign government title transfer documents. See IRM 1.2.2.10.2(6), Order Number 9-2 (Formerly DO-158, Rev. 2), Initiate Investigations and Seize and Forfeit Property under the Money Laundering Control Act and Bank Secrecy Acts.

Upon receipt of the Disposition Order along with a judgment or Final Order of Forfeiture from the COR/DAR to sell real property, the seized property contractor will evaluate the property, analyze variables, and determine the appropriate method of sale (e.g., sell by auction or list with a local real estate broker and sell through usual real estate marketing procedures).

The seized property contractor will record the Final Order of Forfeiture with the appropriate authorities when requested by the COR/DAR. The COR/DAR will provide the seized property contractor with the Disposition Order, and a certified copy of the final recorded order of forfeiture from the court.

It is the policy of the Department of the Treasury to sell forfeited real properties with title insurance to maximize the revenue from the sale. On occasion, some real properties are held for long periods of time while CI and the seized property contractor attempt to clear a "clouded" title to the property as interpreted by the title company. This results in increased property management costs and the inherent liabilities of maintaining vacant real properties in inventory for long periods of time.

Real property forfeited to the government in a judicial proceeding vests title in the United States. On occasion, title companies challenge the government's title for title insurance purposes because of perceived defects in notice, in the satisfaction of lienholder interest, or in the forfeiture process. As a result, these title companies will not issue title insurance for the property.

In order to expedite the disposition of properties with "clouded" titles, it is the policy of the Department of the Treasury to dispose of the property using a Special Warranty Deed and, if necessary, an Indemnification Agreement. This procedure, as detailed in TEOAF Directive 32, Use of Special Warranty Deed and Indemnification Agreement for the Sale of Real Property, should expedite the sale of such properties but may not encourage a title company to issue title insurance.

For guidance in disposing of real property contaminated with hazardous substances or lead based paint, or real property included in or eligible for the National Register of Historic Places, refer to:

The Department of the Treasury's policy on the payment of liens on forfeited motor vehicles is contained in TEOAF Directive 33, Seizure of Motor Vehicles, Payments of Liens, and Official Use Requirements.

Once a forfeited vehicle is sold, the COR/DAR must forward a written request to pay off the lien from the SAC; through the Director, ARIS; to the Director, TEOAF. The request must include a copy of the Disposition Order signed by the seized property contractor stating the gross sales proceeds, a statement indicating the appraised value at the time of seizure, and any other required information and documentation specified in TEOAF Directive 33.

It is the responsibility of the COR/DAR to notify ARIS when expedited action is required to comply with the terms of a court order. CI must communicate to the involved AUSA the need to include reasonable time limits for the accomplishment of lien payments in court orders. A 90-day period from the date of issuance of a forfeiture order or from the date of sale is the recommended standard.

It is the responsibility of CI to ensure that requests for payment of liens do not occur until the subject vehicles are forfeited and that the amount of the payment requests do not exceed the lesser of the appraised value, net proceeds of sale, or the unpaid loan principal balance.

The TEOAF will be responsible for expeditiously approving all properly documented lien payment requests and ensuring that the approved requests are timely forwarded for payment processing.

TEOAF Directive 29, Seizure and Disposition of Assets Subject to Title Restrictions, requires participating TFF law enforcement agencies to determine at the time property is seized for forfeiture if a particular seized property was reported as "stolen" in situations involving vehicles, vessels, and aircraft or as salvage in cases involving conveyances. TEOAF Directive 29 requires that the status of these properties be checked again at the time of disposition to ensure that no reports identifying these properties as "stolen" or as "salvage" were reported to law enforcement, licensing, or titling agencies after seizure.

For any properties identified as “salvage”, title shall be carefully examined to determine whether it should be held until forfeiture, and to determine what type(s) of disposition would be acceptable upon forfeiture.

Any properties identified as "stolen" or "salvage" will not be sold, retained for official use, or transferred to another federal law enforcement agency through equitable sharing without a written request for approval from the SAC, through the Director, ARIS; to the Director, TEOAF.

For salvage properties approved for sale, the property must be fully identified as “salvage” at time of auction.

A settlement that purports to "forfeit" property only binds the parties to that agreement; therefore, it is necessary to complete the forfeiture action so that a forfeiture of the property occurs. In civil forfeiture cases, the AUSA must assure that a valid and complete forfeiture occurs by:

If the settlement occurs in the context of a criminal investigation by way of a plea agreement, the AUSA must remember that a defendant can agree to forfeit only that interest in the property that belongs to them. Any settlement in the context of a plea agreement technically results in a forfeiture of only the defendant's interest in the property with the interests of third parties to be resolved in an ancillary proceeding. Accordingly, the AUSA must ensure that a valid forfeiture results through a plea agreement by:

CI may place forfeited property that has a law enforcement purpose into official use. Neither cash nor proceeds from the sale of forfeited property may be transferred to or retained by the participating TFF enforcement agency. Cash and proceeds must be deposited into the TFF.

Requests to retain or transfer real property to other federal agencies may be considered if such transfers will serve a significant and continuing federal purpose. Requests to place real property into official use must be submitted by memorandum from the SAC; through the Director, ARIS; to the Director, TEOAF.

No seized property will be placed into official use until a Final Judgement, Declaration of Forfeiture, or Final Order of Forfeiture has been entered and the request to place the property into official use has been approved by the appropriate official. Likewise, other federal agency acting in the capacity of a substitute custodian may not use such property for any purpose before completion of the forfeiture. However, the Director, TEOAF, may grant exceptions in certain situations, such as the seizure of a ranch or business where continued operation of the enterprise is necessary to maintain the value of property.

The TEOAF requires each participating TFF enforcement agency to establish internal guidelines consistent with the following guidelines governing the placement of property into official use.

All official use guidelines shall:

The Secretary of the Treasury has delegated the authority to place real property into official use to the Under Secretary, Terrorism and Illicit Finance. The Under Secretary, Terrorism and Illicit Finance, has delegated this authority to the Director, TEOAF.

The Secretary of the Treasury has delegated the authority to place non-cash personal property into official use to the head of the participating TFF law enforcement agency responsible for the seizure.

Requests to place non-cash personal property into official use in CI must be submitted by memorandum from the SAC to the Director, Field Operations (DFO), with the concurrence of the CI Headquarters Section responsible for that program area (i.e., undercover assets through Special Investigative Techniques (SIT) and investigative equipment through the National Criminal Investigation Academy (NCITA)), justifying and detailing the reasons why the forfeited property should be placed into official use.

CI does not place forfeited vehicles into official use.

When CI seeks to place forfeited property into official use and another federal, state, local agency, or foreign country has filed a request for an equitable share of the property, the SAC, with assistance from the COR/DAR and investigating agent, may refer to the TEOAF’s SharePoint site for the Guide to Equitable Sharing for State, Local, and Tribal Law Enforcement Agencies for Seized and Forfeited Property, for factors to consider in making a determination regarding the disposition of the property.

The Secretary of the Treasury has delegated responsibility for the operation and administration of the TFF to the Under Secretary (Terrorism and Illicit Finance) who has re-delegated these functions and duties to the Director, TEOAF.

The Under Secretary (Terrorism and Illicit Finance), or designee, makes all determinations regarding distributions from the TFF. As part of this process, TEOAF prepares annual budget estimates for the TFF based on information submitted by participating TFF law enforcement agencies.

The TEOAF is responsible for preparing and submitting to Congress annual budgets and reports on the TFF. The participating TFF law enforcement agencies, including CI, provide the necessary information to TEOAF for preparation of these reports.

The TFF is a special fund. Special funds are federal fund collections that are earmarked by law for specific purposes. 31 USC 9703 defines the purposes for which revenue forfeited by the Department of the Treasury may be used.

The TFF utilizes two types of spending authorities:

The following is a summarized list of mandatory authority expenses that qualify for reimbursement from the TFF with respect to seizures and forfeitures effected by CI or another participating TFF law enforcement agency:

For a comprehensive list of mandatory expenses reimbursable from the TFF, and whether they qualify, consult CI’s TEOAF Liaison or the Director, ARIS.

In addition to payments and reimbursements for expenses of a seizure and forfeiture not effected by CI or another participating TFF law enforcement agency, expenses not payable from the TFF include, but are not limited to:

The Secretary of the Treasury has the discretion to make payments from the TFF for other specifically authorized expenses when funds are appropriated for that purpose. See 31 USC 9703(a)(2).