New Jersey Section 2C:66-3 – Issuance of an order
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New Jersey Section 2C:66-3 – Issuance of an order
New Jersey Section 2C:66-3 outlines the process for issuing an order to freeze assets in cases involving suspected terrorist activity or support. This section is part of New Jersey’s laws regarding the attachment of deposited funds of suspected terrorists or their supporters (Chapter 2C:66).
Under 2C:66-3, if the Attorney General or a county prosecutor believes that funds held in a financial institution may be subject to forfeiture as terrorist assets, they can apply for an order from a judge to freeze those assets so they cannot be withdrawn or transferred. The application must contain an affidavit setting out the facts supporting the belief that the funds may be subject to forfeiture under the terrorist asset forfeiture laws[1].
If the judge finds that there is probable cause to believe the funds may be forfeitable, the judge can issue an order directing the financial institution to freeze all or part of the account holder’s funds or assets. This means the account holder cannot access or move those funds while the forfeiture proceedings are pending. The order also prohibits the financial institution from disclosing any information about the order to the account holder or others, in order to prevent funds from being withdrawn in anticipation of possible forfeiture[1].
There are some important things to note about 2C:66-3 orders:
- They can only be issued for funds that may be forfeitable under the terrorist asset forfeiture laws. There has to be some evidence linking the funds to potential terrorist activity or support[1].
- The order is temporary, lasting only 10 days unless extended by the court[4]. This gives prosecutors time to initiate formal forfeiture proceedings against the funds.
- There is a process to challenge the order. The account holder can file an application asking the judge to vacate the order after giving 10 days notice to the prosecutor’s office[4]. This provides some due process protections.
- A preliminary hearing on the freezing order can also be requested, where the account holder can raise arguments for why their funds should not be forfeited[4].
So in summary, 2C:66-3 provides law enforcement with a powerful tool to quickly freeze terrorist-linked assets before they can be withdrawn or transferred out of reach. But there are also checks built in, such as time limits and a process to challenge the freezing orders, to prevent abuse and protect individual rights.
Implications and Analysis
The issuance of 2C:66-3 orders can have significant implications for those whose funds are frozen as well as financial institutions. Here are some key considerations:
Impact on Account Holders
Having account funds suddenly frozen without notice can cause major disruption and hardship for account holders. They lose access to their money, which may be needed for regular expenses like rent, medical care or child support during the freeze period. Just the initial 10-day freeze could be devastating to someone living paycheck to paycheck[2].
Even if the funds are ultimately unfrozen and returned, the account holder may face consequences like late fees, interest charges, and damage to their credit if they missed payments due to the asset freeze[3]. There could also be significant legal fees involved in challenging the order.
So while these orders are an important tool for law enforcement, they can negatively impact innocent account holders swept up in the process before any actual wrongdoing is proven.
Compliance Costs and Risks for Financial Institutions
Receiving and complying with 2C:66-3 orders also creates costs and risks for banks, credit unions and other financial institutions. They have to set up procedures to quickly freeze accounts when orders are received. And they must do so without tipping off the account holder, which requires restricting employee access to the orders[1].
Mistakes or delays in complying with orders can lead to significant penalties. Financial institutions can be held in contempt of court for failing to promptly freeze assets as directed in a 2C:66-3 order[3]. So they must devote substantial resources and training to ensure compliance.
The financial industry has warned that the burden of complying with these types of orders could be especially heavy on smaller community banks and credit unions with more limited operations[3].
Potential for Abuse
There are also concerns about the potential for law enforcement agencies to misuse or overreach with 2C:66-3 orders. As one example, the asset freezing powers meant for terrorism could possibly be employed in more routine criminal cases not originally intended by the statute[2].
Or prosecutors may freeze accounts based on weak evidence, depriving account holders of access to their money before establishing clear proof of illegal terrorist connections. This underscores the importance of judges reviewing applications carefully before issuing orders and providing a robust process for challenging orders.
While Section 2C:66-3 remains an important tool, these potential downsides illustrate why checks on the system are necessary to avoid unfair impacts. Monitoring how the law is used in practice can help ensure it strikes the right balance between security and individual rights.
Legal Defenses and Challenging the Orders
There are several legal avenues available to account holders seeking to challenge a 2C:66-3 asset freeze and defend against forfeiture of their funds:
Filing to Vacate the Order
As discussed, after 10 days notice the account holder can file a formal application with the court asking the judge to lift or vacate the freezing order under 2C:66-3(c) [4]. This starts a legal process where the account holder can argue against the freeze, presenting evidence why their account should no longer be blocked. Grounds could include lack of proof connecting funds to terrorism, hardship from losing account access, or authorities abusing their power under the statute.
Requesting a Preliminary Hearing
In the same application asking the court to vacate the order, the account holder can also demand a prompt preliminary hearing on the asset freeze itself[4]. This is an opportunity to challenge the seizure immediately after it occurs, requiring the state to justify its actions to the judge. The account holder can argue there is no legitimate basis for the order and their funds should be released.
Filing a Motion to Suppress
If prosecutors ultimately pursue criminal asset forfeiture against the account, the account holder can file a motion to suppress the seized funds as evidence[5]. This asserts the government violated their constitutional rights or lacked probable cause when obtaining the assets. If granted, charges could potentially be dismissed and money returned.
Presenting a Claim Opposing Forfeiture
The account holder can also formally contest the attempted forfeiture by presenting a legal claim opposing it once proceedings begin[5]. This triggers a court process where prosecutors must essentially prove their case for forfeiture. The defense can move to dismiss if the government fails to establish proof.
So in summary, an experienced criminal defense attorney can pursue multiple avenues to fight back against questionable or abusive use of freezing orders and forfeitures under Section 2C:66-3. Key remedies include seeking to vacate orders, demanding preliminary hearings, filing suppression motions, and formally contesting any attempted forfeitures. Account holders should explore all legal defenses to protect their rights and property.
Conclusion
New Jersey Section 2C:66-3 provides law enforcement with a rapid process to freeze bank accounts linked to terrorism during investigations. But the broad powers involved, hardships for account holders, and costs of compliance mean there is also potential for abuse.
It will be important to monitor how these orders are employed going forward, and for judges to apply careful scrutiny when approving them. Account holders can also help check overreach by promptly challenging questionable or excessive asset freezes through various legal defenses.
Striking the right balance under 2C:66-3 can allow counterterrorism efforts to stay a step ahead of violence financing. But adding in appropriate checks against misuse or overreach will be key to avoiding unfair impacts on individual rights and property.