later, the Oregon Supreme Court issued a similar ruling.
First, We Led Your Husband to Suicide. Now, We’re Coming for Your Property
Mara Lynn Williams is a widow and cancer survivor. She lost her husband, Royce, in 2009. Then the government tried to seize her hardscrabble 40-acre farm in Chilton County, Alabama.
You see, Royce smoked marijuana. Not because he was trying to get high, but because it was the only substance that relieved his chronic pain after multiple surgeries.
However, in the government’s War on (Some) Drugs, persons who smoke marijuana for any reason are considered criminals. And that’s particularly true if they cultivate it, as Royce did on the couple’s farm.
In 2009, as a jury was deliberating marijuana cultivation charges against Royce, he climbed into the family car and shot himself. His suicide ended the criminal case, but prosecutors decided to seize the couple’s property, even though they never accused Mara Lynn of any crime. Asset Forfeiture Coordinator Tommie Brown Hardwick said, “The bottom line is, we don’t want people to benefit from criminal activity.”
Let’s count all the ways that Mara Lynn Williams has benefited—or not—from criminal activity.
First, prosecutors never accused Royce—or Mara Lynn of actually selling marijuana. They only accused Royce of cultivating it with the intent to sell it. So, Mara Lynn didn’t receive a penny in “criminal proceeds.”
Second, during a raid on the couple’s farm, police seized firearms, $18,400 in cash, vehicles, computers, and other personal belongings. Mara Lynn got some of the vehicles back, but not the cash.
Third, Mara Lynn had to hire an attorney to represent her in the forfeiture case. I’m not privy to the fee arrangements, but typically, attorneys defending civil forfeiture cases receive a retainer of $20,000 or more.
In the meantime, she continued to work as a nurse at Jackson Hospital in Montgomery. The government through its insane drug war had already taken her husband and $18,400 of the couple’s savings. Now it wanted to make her homeless.
In the end, the government settled for the cash. In 2010, it closed civil forfeiture claims against Mara Lynn in exchange for the $18,400 it had already seized. As is typical in civil forfeiture cases, the settlement stipulated, “The parties shall bear their own costs.”12
Far from benefiting from criminal activity, Mara Lynn is out $18,400 in cash, plus attorney fees!
The Riskiest Activity My Clients Engage in Is…
Marriage. That’s right. Marriage.
I’m not talking about physical risk here (although some marriages do involve physical abuse), but financial risk. That’s because marriage, or more specifically the end of marriage, or divorce, can pose an unprecedented risk to your wealth.
If your spouse wants to make your life a living hell and make you face financial ruin, hundreds of thousands of lawyers stand ready, willing, and able to facilitate that process. There’s simply no end to the dirty tricks that angry spouses or the lawyers representing them can play.
To start with, your spouse may start making 911 calls claiming that you are abusive. The goal is to get you thrown in jail and declared an unfit parent. That way, your spouse gets sole custody of your children.
Does your spouse have access to your cell phone or computer? If so, he or she can install monitoring devices to eavesdrop on every phone call, text message, e-mail message, or instant message you send. It’s illegal, but common.
How about your driving records? If you’ve even driven on a toll road with an electronic toll collection system, your spouse’s divorce attorney will retrieve these records. For instance, they might be useful at proving that instead of staying downtown to work late at the office, like you told your spouse, you actually passed through toll plaza a stone’s throw away from the Cheatin’ Heart Motel.13
But the real fun begins when it comes time to divide assets and determine “fair” alimony payments.
For instance: let’s say that you’ve built a successful business. Your spouse helped, but you did the lion’s share of the work. In divorce court, though, your spouse testifies that he or she did everything. The judge may well award your spouse your business, and leave you out in the cold. You may even be required to pay your ex-spouse for the cost of training someone to take your place.
If you’ve ever cheated on your taxes, your spouse can go to the IRS and receive up to a 30% reward for turning you in (Chapter 2). You say it was your spouse’s idea to take tax “shortcuts?” Just try to prove that to the IRS.
There’s also a sneaky legal concept called “enhanced earning capacity.” It’s particularly detrimental to a young person who gets divorced. Not only must you give your ex-spouse a hefty chunk of your assets, you must also make additional payments if your income increases. You might even have to make larger payments whether your income increases or not—it’s sufficient that it should increase.14
Your “Secret” Offshore Account Suddenly Isn’t So Secret
Speaking of cheating the IRS…over the last few years, the IRS has become much more aggressive in trying to unearth unreported offshore bank accounts. And the U.S. Treasury has forced dozens of countries to loosen their bank secrecy rules to allow U.S. tax authorities to make inquiries into account activities. If you have an unreported offshore account, this could spell big problems.15
Penalties for failing to report offshore accounts are severe. Count on a $10,000 penalty for each year you failed to report the account for starters. If there’s substantial unreported income, the penalties are much higher. And in aggravated situations, you may be imprisoned.16
What’s more, the definition of what constitutes a “foreign account” is constantly expanding. The IRS even wants foreign persons “in or doing business” in the UnitedStates to report their non-U.S. accounts, although it’s delayed the deadline for doing so indefinitely.17
These Are NOT Isolated Incidents…
The mainstream media keeps you well informed about celebrity sex scandals, drug abusing sports stars, and politicians who cheat on their spouses. But, I suspect you haven’t read much about the following trends:
• Criminalization. In 1789, when the first U.S. Congress met, there were three federal crimes: treason, counterfeiting and smuggling to avoid tariffs. Today, there are more than 4,000 of them. Congress enacts hundreds more laws annually, and the bureaucracies spawned to enforce them churn out more than 80,000 pages of regulations that carry the force of law each year. Many of these statutes and regulations impose criminal sanctions for their violation.18
• Erosion of electronic privacy. In 1967, the Supreme Court ruled that police needed to obtain a search warrant in order to wiretap your phone.19 That principle still applies, but in the intervening years, that protection has seriously eroded. For instance, police can obtain a list of phone numbers you dial or receive calls from, without a warrant.20
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