2014-04621. Authorization To Seize Property Involved in Drug Offenses for Administrative Forfeiture (2012R-9P)

AGENCY:

Department of Justice.

ACTION:

Final rule.

SUMMARY:

The Department of Justice is amending its regulations to extend the trial period during which the Director of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) may exercise, for an additional one-year period following the effective date of this rule, the authority under the United States Code to seize and administratively forfeit property involved in controlled substance offenses. The Attorney General has determined that the trial period that ends on February 25, 2014, should be extended for another year to give ATF more time to refine its processes, fully hire and train all necessary staff, and further demonstrate the effectiveness of the delegation in the investigation of violent crimes involving firearms.

DATES:

Effective Date: This rule is effective March 4, 2014.

Applicability Date: This delegation became operative on February 25, 2014, the date that it was issued by the Attorney General.

FOR FURTHER INFORMATION CONTACT:

Denise Brown, Enforcement Programs and Services, Bureau of Alcohol, Tobacco, Firearms, and Explosives, U.S. Department of Justice, 99 New York Avenue NE., Washington, DC 20226, telephone: [phone].

SUPPLEMENTARY INFORMATION:

Background

After ATF became part of the Department of Justice in January 2003, pursuant to the Homeland Security Act of 2002 (Public Law 107-296), the Attorney General delegated to ATF the authority to investigate, seize, and forfeit property involved in a violation or attempted violation within its investigative jurisdiction. See 28 CFR 0.130(b)(1). ATF investigations focusing on violent crime frequently involve complex criminal organizations with multiple criminal enterprises and uncover drug-related offenses in addition to offenses within ATF's primary jurisdiction, such as violations of the Gun Control Act, 18 U.S.C. Chapter 44, or the Contraband Cigarette Trafficking Act, 18 U.S.C. Chapter 114. In such investigations, ATF historically did not have authority under 21 U.S.C. Chapter 13 to seize for administrative forfeiture property involved in controlled substance offenses. Instead, ATF generally referred such property to the Drug Enforcement Administration (DEA), which is primarily responsible for investigating violations of drug laws contained in title 21 of the United States Code. DEA would then initiate, process, and conclude all necessary forfeiture actions for the controlled-substance-related property.

The Department of Justice believes that forfeiting the assets of criminals is an essential tool in combating criminal activity and provides law enforcement with the capacity to dismantle criminal organizations that would otherwise continue to function after conviction and incarceration of individual participants. The Department further believes that administrative forfeiture permits the expedient and effective use of this crucial law enforcement tool.

An uncontested administrative forfeiture can be perfected in 60-90 days for minimal cost, including the statutorily required advertisement and notice by registered mail. Conversely, the costs associated with judicial forfeiture can amount to hundreds or thousands of dollars and the judicial process generally can take anywhere from 6 months to years. In the meantime, the government incurs additional costs if the property requires storage or maintenance until a final order of forfeiture can be obtained.

One of the primary missions of the ATF is to combat firearm-related violent crime. The nexus between drug trafficking and firearm violence is well established. On review of the current role and mission of ATF within the Department of Justice, the Attorney General decided to authorize a temporary delegation of title 21 seizure and forfeiture authority to determine whether such authority can enhance the effectiveness of ATF in the investigation of violent crimes involving firearms. On August 21, 2012, the Attorney General signed a final rule delegating seizure and forfeiture authority under 21 U.S.C. 881 to the ATF for a trial period of one year, effective February 25, 2013. 77 FR 51698 (Aug. 27, 2012). This final rule amended the regulations in 28 CFR part 0 to authorize the Director of ATF to exercise, for a period of one year from the effective date of the final rule, the authority to seize, forfeit, and remit or mitigate the forfeiture of property in accordance with 21 U.S.C. 881. See 28 CFR 0.130(b)(2). After considering the effectiveness of this delegation over the course of the one-year period, the Attorney General decided to extend the trial period for an additional year. This extension will give ATF more time to refine its processes, fully hire and train all necessary staff, and further demonstrate the effectiveness of the delegation in the investigation of violent crimes involving firearms.

Since receiving the authority to seize, forfeit, and remit or mitigate the forfeiture of property in accordance with 21 U.S.C. 881, ATF seized both narcotics-related assets and firearms or explosives in approximately 70 percent of cases in which property was seized. The authority gives ATF the ability to process narcotics-related property seized in criminal investigations in which firearms and explosives also are seized. The delegation of authority has afforded cost savings to the United States government by streamlining the forfeiture process to prevent unnecessary burden on the judicial system and the public and by permitting the government to process forfeitures within a single agency.

From February 25, 2013, to December 25, 2013, ATF seized a total of 339 assets pursuant to the delegation of authority to seize, forfeit, and remit or mitigate the forfeiture of property in accordance with 21 U.S.C. 881. The total value of those assets amounted to $5,376,387.70.

Final Rule

This rule amends the regulations in 28 CFR part 0 to allow the Director of ATF to continue to exercise, for a period of one year from the effective date of this final rule, the authority to seize, forfeit, and remit or mitigate the forfeiture of property in accordance with 21 U.S.C. 881.

Forfeiting the assets of criminals is an essential tool in combating criminal activity and provides law enforcement with the capacity to dismantle criminal organizations that otherwise would otherwise continue to function after conviction and incarceration of individual participants. The Attorney General has decided to extend for a one-year period, beginning February 25, 2014, and ending on February 25, 2015, the delegation of administrative seizure and forfeiture authority to give ATF more time to refine its processes, fully hire and train all necessary staff, and further demonstrate its effectiveness in the investigation of violent crimes involving firearms. ATF may continue to exercise this delegated authority for all property in its possession on or before the end of the extension period, even if this delegation is not otherwise extended.

How This Document Complies With the Federal Administrative Requirements for Rulemaking

Administrative Procedure Act (APA)

Notice and comment rulemaking is not required for this final rule. Under the APA, “rules of agency organization, procedure or practice,” 5 U.S.C. 553(b)(A), that do not “affect[] individual rights and obligations,” Morton v. Ruiz, 415 U.S. 199, 232 (1974), are exempt from the general notice and comment requirements of section 553 of title 5 of the United States Code. See JEM Broad. Co. v. FCC, 22 F.3d 320, 326 (D.C. Cir. 1994) (section 553(b)(A) applies to “agency actions that do not themselves alter the rights or interests of parties, although [they] may alter the manner in which the parties present themselves or their viewpoints to the agency”) (quoting Batterton v. Marshall, 648 F.2d 694, 707 (D.C. Cir. 1980) (internal quotation marks omitted)). The revisions to the regulations in 28 CFR Part 0 are purely a matter of agency organization, procedure, and practice that will not affect individual rights and obligations. This rule does not expand the government's ability as a matter of law to effectuate forfeitures; it simply authorizes the Director of ATF to effectuate such forfeitures. Internal delegations of authority such as in this final rule are “rules of agency organization, procedure, or practice” under the APA. In addition, this rule is exempt from the usual requirements of prior notice and comment and a 30-day delay in effective date because, as an internal delegation of authority, it relates to a matter of agency management or personnel. See 5 U.S.D. 553(a)(2).

Regulatory Flexibility Act

The Attorney General, in accordance with the Regulatory Flexibility Act, 5 U.S.C. 605(b), has reviewed this rule and, by approving it, certifies that it will not have a significant economic impact on a substantial number of small entities because it pertains to personnel and administrative matters affecting the Department. Further, a Regulatory Flexibility Analysis is not required for this final rule because the Department was not required to publish a general notice of proposed rulemaking for this matter.

Executive Order 12866 and Executive Order 13563

This rule has been drafted and reviewed in accordance with Executive Order 12866, “Regulatory Planning and Review,” section 1(b), Principles of Regulation, and with Executive Order 13563, “Improving Regulation and Regulatory Review.” This rule is limited to agency organization, management, or personnel matters as described by Executive Order 12866, section 3(d)(3) and, therefore, is not a “regulation” or “rule” as defined by that Executive Order.

Executive Order 12988

This regulation meets the applicable standards set forth in sections 3(a) and 3(b)(2) of Executive Order 12988, “Civil Justice Reform.”

Executive Order 13132

This rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, in accordance with Executive Order 13132, “Federalism,” the Department has determined that this rule does not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement.

Unfunded Mandates Reform Act of 1995

This rule will not result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year, and it will not significantly or uniquely affect small governments. Therefore, no actions are necessary under the provisions of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1501 et seq.

Small Business Regulatory Enforcement Fairness Act of 1996

This rule is not a major rule as defined by section 251 of the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), 5 U.S.C. 804. This rule will not result in an annual effect on the economy of $100 million or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets.

Congressional Review Act

This action pertains to agency management, personnel, and organization and does not substantially affect the rights or obligations of non-agency parties. Accordingly, it is not a rule for purposes of the reporting requirement of 5 U.S.C. 801.

List of Subjects in 28 CFR Part 0

• Authority delegations (Government agencies)
• Government employees
• Organization and functions (Government agencies)
• Privacy
• Reporting and recordkeeping requirements
• Whistleblowing

Authority and Issuance

Accordingly, by virtue of the authority vested in me as Attorney General, including 5 U.S.C. 301 and 28 U.S.C. 509, 510, and for the reasons set forth in the preamble, part 0 of title 28 of the Code of Federal Regulations is amended as follows:

PART 0—ORGANIZATION OF THE DEPARTMENT OF JUSTICE

1. The authority citation for 28 CFR Part 0 continues to read as follows:

Authority: 5 U.S.C. 301; 28 U.S.C. 509, 510, 515-519.

2. Section 0.130 is amended by revising the second sentence in paragraph (b)(2) to read as follows:

§ 0.130

General functions.

* * * * *

(b) * * *

(2) * * * This authority is effective during the 24-month period beginning on February 25, 2013, and ending on February 25, 2015, except that it may continue to be exercised after February 25, 2015, with respect to any property in the Bureau's possession on or before that date.

* * * * *

Dated: February 25, 2014.

Eric H. Holder, Jr.,

Attorney General.