TSA agents check a passenger’s bags, Secaucus, New Jersey Jan. 31, 2014.

DETROIT – Border Patrol agents often seize large sums of money from individuals and families who are penalized for failing to declare the amount of cash they’re carrying when traveling outside of the United States. 

When traveling outside the U.S., people are required to fill out a form declaring the amount of currency they are carrying if it exceeds $10,000, whether in the form of cash or checks. They are regularly asked by U.S. Customs and Border Patrol (CBP) and Transportation Security Administration (TSA) agents if they are carrying more than the maximum allowed amount. If they are, travelers are asked to declare the money and are allowed to continue with their trip.

Many times, however, travelers do not comply with the federal regulation for various reasons, subjecting them to questioning, seizure and forfeiture of the money. 

“It is the policy and the practice of the United States government to aggressively pursue the seizure and forfeiture of assets that are moved to, or hidden in, other countries,” says the Internal Revenue Service Manual. “If successful, the result will be to achieve our primary goal of taking the profit out of crime.”

The Manual also says the domestic forfeiture program has shown that the forfeited money is used to enhance local law enforcement efforts and other agencies who cooperate in investigations.

Katherine Reach, a CBP watch commander in Detroit, said that it is each person’s responsibility to understand the currency reporting requirement before traveling out of the country. Failure to comply with the law out of ignorance or deceit subjects the money to seizure. After an investigation, the currency can be forfeited, causing the traveler to lose more than $10,000.

Who tries to smuggle money?

Helal Farhat, an attorney in Dearborn, said he has seen an increase in forfeiture cases in the community in the past year. He said one reason many people do not declare the money is “the community’s inherent fear of government units and the police.”

Most cases involve a family with each member carrying money totaling more than $10,000, said Farhat. He explained that most people do not know the cash limit is $10,000 per family, not per individual, and they are looked at as one unit. 

Farhat said another typical practice in the community is for people to send money to relatives overseas with non-family members traveling to that country. Many times, the amount that individual is carrying, in addition to the money being sent, puts the traveler over the cash limit. 

“It’s always been groups of people generally related, traveling together,” said “Michael”, the alias of an associate attorney at a prominent local civil rights organization who wished to remain anonymous. He echoed Farhat’s remarks that it is common for family members to have their money seized and forfeited, because they do not realize the entire family is being considered as one unit.

“The law is ambiguous at best,” Michael said. “It’s as clear as mud. They rely on a  very obscure treasury regulation that allows them to tie the money together if it’s an immediate family. I’ve seen far too many innocent people get caught up in this.”

Most travelers who are asked to step aside for questioning end up missing their flights. The law does not prevent people from continuing with their travels, but in many cases they cannot because all of their money has been seized, making travel impractical.

Eric Wagner, an attorney at a New York law firm that specializes in seizure and forfeiture cases, said the firm represented an Egyptian client who, after winning a forfeiture case, was prevented from traveling and received a pat down every time he attempted to fly, because there were several attempts to add him to the terrorist watch list. 

However, there are laws in place that prevent the government from applying excessive punishment for a crime. In the 1998 case of U.S. vs. Banjakajin, the Supreme Court ruled that the excessive fines clause of the 8th Amendment applies to forfeiture cases. It said the amount of forfeiture cannot be grossly disproportional to the harm suffered by the government as result of the alleged criminal activity.

Wagner said he dealt with a case where an elderly man who grew up in during the Great Depression did not trust government and corporate banking. 

He added that people from other countries can be very suspicious of government— especially oppressive ones.

Ali Baleed Almaklani, the executive director of the Yemen American Benevolent Association (YABA), said Yemeni Americans are specifically asked about the amount of money they are carrying when they leave the country.

The CBP, said Wagner, believes that failure to report currency is a gateway crime. He explained that some people have ill intentions and want to evade taxes or launder money.

According to Michael, the CBP doesn’t understand that in some countries, people use credit cards less.

“Sometimes people want to avoid transaction fees,” he said. “Sometimes they prefer cash because of the cash economy over there.”

The Process

Farhat said once the TSA seizes a traveler’s money, it’s not forfeited until the CBP makes a decision. Then, CBP will send documentation to the individual’s address, including a form that allows him or her to submit a petition to get the money back, file lawsuit or to allow the government to keep the money. That last is essentially an admittance that the individual has broken the law. 

The other form is a document asking the individual to release the CBP from any liability for having seized the money and states the CBP can’t be sued after the money has been returned.

Most people choose to get their money back and prove their innocence and that the money’s source is legal. The procedure is in place not to prohibit free flow of travel, but to be a mechanism to prevent illegal activity.

Michael, the anonymous attorney, said the process is not hard, but tedious.

“They ask for three years of tax records, then we need to demonstrate all sources of income, where the money came from and where it’s going,” he said. “Getting three years of bank statements can be a real pain.” 

He added that the records have to be shown for every bank where a withdrawal was made. Many times someone has multiple accounts at multiple banks; and years of records need to be compiled from all the banks and for every person who had their money seized.

Both Michael and Farhat said the average time it takes for someone to have their money returned after being seized is three months.

However, no one gets all their money returned. According to forfeiture law, a fee is automatically forfeited from the traveler’s money. The amount is based on a scale in which the more money an individual doesn’t declare equals more money forfeited to the CBP. 

“Ever since 9/11, they’re suspicious if you’re Arab American or Muslim,” said Michael, who is Caucasian. “It would be naive to say they aren’t targeting certain individuals for these inspections.” 

He added the he travels abroad frequently and has never been asked if he was carrying cash.

How to avoid asset forfeiture

Reach, the CBP Detroit watch commander, said the best way to avoid asset seizure and forfeiture is to declare the money when encountering a TSA or customs officer. To declare the money, the passenger should fill out a Customs Form 4790. She added that if needed, forms in different languages are available. 

Farhat also advised people traveling out of the country to always be forthright with the amount of money they carry, because if declared, travelers can carry more than $10,000, without hassle.

Monetary instruments, including U.S. or foreign coins, currency, traveler’s checks, money orders, and negotiable instruments or investment securities in bearer form, are all considered when determining the total $10,000 reporting requirement. 

For any questions, call the U.S. Customs and Border Patrol at 877-227-5511 or visit cbp.gov.