The Wall Street Journal
9/20/93

Seizing Wire Transfers

The government can intercept international wire transfers without a
warrant, a federal appeals court said, further expanding the scope of
scope of civil forfeiture laws.

The ruling is apparently the first at the appellate level to address
forfeitures involving international wire tranfers, in which bank
credits usually are shuffled from a sending bank, to a receiving
bank.

In the case before the Second U.S. Circuit Court of Appeals,
drug-enforcement agents seized $12 million at intermediary banks in
New York. The government had a warrant to seize only some of the
money, all of which was on its way to Colombia.

The defendants, 17 Columbian companies that say they are clothing
exporters, said the government violated constitutional protections
against unreasonable searches and seizures. The companies also said
the government broke federal privacy laws by subpoenaing their
financial records.

A three-judge panel of the appeals court in New York, however, ruled
that electronic fund transfers happen so quickly that the government
can act without a warrant. The court also said the Right of Financial
Privacy Act didn't apply, the court said, because no special device,
such as a wiretap, is used in seizing a wire transfer.

Montgomery Blair Sibley, a Miami attorney for some of the defendants,
said the government should have been blocked because it had
insufficient evidence to seize his client's money. He said a decision
hasn't been made on whether to ask the full appeals court to
reconsider the decision.

(U.S. vs. Daccarett et al., Second U.S. Circuit Court of Appeals,
92-6229)

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