323.1Forfeiture of Property

Forfeiture of Criminal Proceeds

The proceeds of criminal activity are subject to forfeiture under G.S. 14-2.3, “Forfeiture of gain acquired through criminal activity.” Under this statute (except as specifically provided for by other statutes regarding street gangs, specific offenses, etc. - see below), any money or property that is acquired by criminal activity shall be forfeited to the state, including any profits, gain, remuneration, or compensation that was directly or indirectly collected by the offender. See G.S. 14-2.3(a). After the defendant is convicted, an action to recover such property may be brought by either the District Attorney or the Attorney General, but it must be brought within three (3) years of the conviction date. See G.S. 14-2.3(b).
G.S. 14-2.3 does not require forfeiture of any money or property recovered by law enforcement during the course of their investigation if such money or property is readily identifiable by the owner or guardian, or such property is traceable to him or her. See G.S. 14-2.3(c). In other words, the statute does not preclude returning stolen money or property to a victim, even though the money or property was acquired by the defendant through criminal activity.

The basic steps for seeking forfeiture of criminal proceeds under this statute are as follows:

1. Seizure. If the property has not already been seized by an officer as part of the investigation or arrest, obtain a seizure order from judge.
2. Process. File a motion/petition for forfeiture, and serve it on the defendant.
3. Schedule a hearing. After the defendant has been convicted, the court must immediately conduct an ancillary forfeiture hearing, or set a date for such a hearing.
4. Present evidence. This evidence may include copies of the conviction and judgment from the criminal trial or plea, testimony from witnesses, and other documentation or records. The rules of evidence are “relaxed” at a forfeiture hearing. See State v. Woods, 146 N.C. App. 686, 694 (2001) (“thus, the evidence would have been admissible even if there had been an objection”).
5. Judicial determination. The judge must make findings of fact and conclusions of law and, if appropriate, enter an order of forfeiture and an appropriate disposition

There are very few appellate cases interpreting or applying G.S. 14-2.3, so the burden of proof for forfeiture under this statute is not entirely clear. But as long as the defendant has already been convicted of an underlying criminal offense by proof beyond a reasonable doubt, the subsequent forfeiture proceedings regarding the property should require no more than proof by a preponderance of the evidence. See State v. Johnson, 124 N.C. App. 462 (1996) (“Since an in personam action is criminal, the government must prove the charges against the defendant beyond a reasonable doubt. In an in rem action, on the other hand, only proof by a preponderance of the evidence is required.”); see also State v. Meyers, 45 N.C. App. 672 (1980) (addressing burden of proof on claimant seeking return of property).

Other Forfeiture Provisions

The entries below summarize the seizure and forfeiture options available for specific types of evidence in relation to particular offenses. For more general information on returning or disposing of evidence other than through forfeiture (destruction, returning to lawful owner, etc.) see the related entry on Custody of Evidence – Disposition After Trial.

1. Property Seized for Investigation/Trial – General
   Under G.S. 15-11.1(a), property lawfully seized as part of an investigation may be retained pending trial or disposition. See also State v. Thompson, 56 N.C. App. 439 (1982) (trial court had authority to retain until trial money seized from defendant’s premises under a valid search warrant, even though no probable cause found at probable-cause hearing). Upon proper notice and hearing, the court may (but is not required to) order the property returned to its lawful owner pending trial, and may enter such other orders as necessary to ensure the property will be available for use as evidence, when needed. Id. After final judgment in the case, the property may be returned, forfeited, sold, or destroyed in accordance with due process, pursuant to G.S. 15-11.1(b) and (c).
2. Firearms and Deadly Weapons
   Firearms and other deadly weapons are subject to forfeiture and disposal pursuant to G.S. 14-269.1 (Confiscation and disposition of deadly weapons), as well as G.S. 15-11.1(b1) (Seizure, custody and disposition of articles) and G.S. 15-11.2 (Disposition of unclaimed firearms not confiscated or seized as trial evidence). Upon conviction for carrying a concealed weapon or any other offense involving the use of a deadly weapon, the weapon shall be confiscated and ordered disposed of by: (i) return to its rightful owner, if allowed by law; (ii) destruction by the sheriff; (iii) given to the sheriff for use in training or for sale, trade, or exchange to a licensed dealer; (iv) turned over to the SBI for official use; or (v) turned over to the N.C. Justice Academy for official use. See G.S. 14-269.1; see also AOC-CR-218 (Side One: Disposing of Firearm upon Prosecutor’s Petition; Side Two: Disposing of Deadly Weapon upon Conviction).
3. Vehicle Forfeitures
   
   1. Impaired Driving
      In certain circumstances, motor vehicles driven by a person charged with an offense involving impaired driving may be seized. Offenses involving impaired driving include driving while impaired under G.S. 20-138.1 as well as related offenses such as habitual impaired driving, impaired driving in a commercial vehicle, and felony death or serious injury by vehicle, or murder, or manslaughter based on impaired driving. See G.S. 20-4.01(24a). A motor vehicle driven by a person charged with an offense involving impaired driving may be seized if, at the time of the offense, the person’s license was revoked for a prior impaired driving license revocation, or the person was not validly licensed and covered by liability insurance. G.S. 20-28.3(a). The procedures for seizing, storing, and forfeiting such vehicles, as well the rights of the defendant, innocent owners, or interested third parties to reclaim the vehicle or contest the seizure and forfeiture, are found principally in G.S. 20-28.2 (Forfeiture of motor vehicle), G.S. 20-28.3 (Seizure, impoundment, and forfeiture), G.S. 20-28.4 (Release of impounded vehicle), and G.S. 20-28.5 (Forfeiture of impounded vehicle).
   2. Speeding to Elude
      Motor vehicles may also be seized if they are driven in connection with a charge of felony speeding to elude. See G.S. 20-141.5. The specific authorization for forfeiture is found is found in G.S. 20-141.5(k), which incorporates the procedures found in G.S. 20-28.2 (Forfeiture of motor vehicle), G.S. 20-28.3 (Seizure, impoundment, and forfeiture), G.S. 20-28.4 (Release of impounded vehicle), and G.S. 20-28.5 (Forfeiture of impounded vehicle).
   3. Prearranged Speed Competition
      G.S. 20-141.3(g) requires that an officer who discovers that a person has operated or is operating a motor vehicle willfully in prearranged speed competition with another motor vehicle on a street or highway seize the motor vehicle. The motor vehicle must be held by the sheriff of the county where the offense was committed pending the trial of the person for violating G.S. 20-141.3(a). If the person is convicted, the motor vehicle must be sold at public auction. The statutory provisions allow for the return of the motor vehicle to an owner who can show that he or she did not know of or have reasonable grounds to know of or consent to the use of the motor vehicle in prearranged speed competition.
   4. Conveyance Used in Theft-Related Activity
      The state may seek forfeiture of all vehicles, watercraft, and aircraft used in commission of larceny over $2,000, common-law robbery, or armed robbery, or that were used to conceal, convey or transport stolen goods or vehicles unlawfully received or possessed in violation of G.S. 14-71, (Receiving stolen goods), 14-71.1 (Possessing stolen goods), and 20-106 (Receiving or transferring stolen vehicles). See G.S. 14-86.1 (Seizure and forfeiture of conveyances used in committing larceny and similar crimes); 18B-504 (Forfeiture). See exceptions listed in G.S. 14-86.1(a)(1) through (a)(6). See State v. Bishop, 343 N.C. 518 (1996) (forfeiture of two vehicles used in armed robbery was proper); see also In re 1990 Cherokee Jeep, 131 N.C. App. 108 (1998) (municipality lacked authority to initiate forfeiture proceeding under G.S. 14-86.1; only district attorney may do so).
   5. Littering Over 500 Pounds
      A motor vehicle, vessel, aircraft, container, crane, winch, or machine involved in the disposal of more than 500 pounds of litter in violation of subsection G.S. 14-399(a) is subject to seizure and forfeiture. See G.S. 14-399(g).
   6. Regulated Metals
      G.S. 66-431 provides for the seizure and forfeiture of vehicles that are used to transport unlawfully obtained regulated metals property.
4. Street Gang Activity
   “All property of every kind used or intended for use in the course of, derived from, or realized through” criminal street gang activity Under 13A of Chapter 14 is subject to forfeiture. See G.S. 14-50.23; G.S. 14-2.3. This provision is much broader than the usual forfeiture of “proceeds” allowed under G.S. 14-2.3, which applies only to money or other interests in property (including profits, gain, remuneration, or compensation) directly or indirectly acquired as a result of committing a criminal offense. See State v. Triplett, 70 N.C. App. 341 (1984). Forfeiture of property covered by this gang activity statute may be pursued through the same procedures used for normal criminal proceeds under G.S. 14-2.3(b).
5. Property Used to Violate ABC Laws
   Motor vehicles, boats, planes, containers, equipment, and ingredients used to transport, sell, or manufacture alcoholic beverages in violation of ABC laws are all subject to forfeiture under G.S. 18B-504(a). There are exceptions if the property was used unlawfully by someone other than the owner and the owner did not know, and for the protection of a party (other than the defendant) who holds a security interest in the property (e.g., a bank with a lien on the car). See G.S. 18B-504(b), (h); State v. Morris, 103 N.C. App. 246 (1991) (judge decides whether a claimant of an interest in seized property is entitled to relief—there is no right to trial by jury for remission of forfeiture of a vehicle used in violation of the controlled substances laws; this ruling would likely apply to forfeitures under ABC laws). See also G.S. 18B-504(c) (Seizure of property); 18B-504(f) (Disposition of forfeited property); 18B-504(g) (Proceeds of sale); AOC-CR-920M (Disposition Order; Seized Alcoholic Beverage Only); AOC-CR-921M (Forfeiture Order, Property Other Than Alcoholic Beverage, ABC Violation).
6. Licensing Privileges
   After a felony conviction, the defendant forfeits his or her licensing privileges (including driving license, occupational license, and hunting or fishing license/permits) pursuant to G.S. 15A-1331.1. This forfeiture is automatic upon conviction, and applies for the full term that the person is on probation. See G.S. 15A-1331.1(b); see also 15A-1331.1(c) (judicial findings, process); AOC-CR-318 (Limited Driving Privilege?Felony Conviction); AOC-CR-317 (Forfeiture of Drivers License – Failure to Complete Community Service).
7. Organized Retail Theft
   Forfeiture of any interest acquired or maintained by organized retail theft; G.S. 14-86.6. Forfeiture must follow procedures set out in G.S. 18B-504.
8. Continuing Criminal Enterprise
   Forfeiture of profits and property interests obtained in continuing criminal enterprise is authorized by G.S. 14-7.20. The forfeiture provisions apply only if defendant is convicted of the Class H felony offense of continuing criminal enterprise.
9. RICO Actions - Civil Forfeiture
   This process is governed by Chapter 75D of General Statutes. The Attorney General of North Carolina is responsible for bringing this civil action. See State ex rel. Thornburg v. Currency, 324 N.C. 276 (1989) (criminal forfeiture provisions of the Controlled Substances Act take precedence over the civil forfeiture provisions of the Racketeer Influenced and Corrupt Organizations Act (RICO), when the possessor of the items seized and subject to forfeiture has been validly indicted and awaits criminal trial under the Controlled Substances Act); State ex rel. Thornburg v. House and Lot, 334 N.C. 290 (1993) (proceeds from sale of property forfeited under RICO must go to school fund); For a case dealing with RICO forfeiture issues in general, see State ex rel. Thornburg v. Tavern, 96 N.C. App. 84 (1989).
10. Chop Shop Activity
    If a defendant engages in “chop shop” activity in violation of G.S. 14-72.7, forfeiture of the instrumentalities (including real property) used to engage in that activity is authorized by G.S. 14-72.7(e). Instrumentalities are subject to seizure and forfeiture provisions of G.S. 14-86.1. Real property used to engage in chop shop activity is subject to abatement and forfeiture provisions of Chapter 19 of the General Statutes (e.g., G.S. 19-6.1, forfeiture of real property).
11. Gambling
    Money, property, or other things of value used to advertise or conduct an unlawful game, including any motor vehicles used to commit the offense, are subject to forfeiture under G.S. 14-299, which also sets forth the seizure and disposal procedure.
12. Nuisance
    Personal property (including money) declared to be a nuisance under G.S. 19-1.3 (lewd films, lewd publications, gambling, prostitution, illegal sale of alcohol or controlled substances, etc.) is subject to forfeiture. See G.S. 19-6 (Civil penalty, forfeiture). Forfeiture of real property involving illegal possession or sale of controlled substances is governed by G.S. 19-6.1.
13. Wildlife and Marine Offenses
    See G.S. 113-137(i) (confiscation of items used in and acquired as a result of wildlife and marine fisheries offenses); G.S. 113-136(b) and 113-136(c) (scope of jurisdiction); G.S. 113-137(c) through (h) (special seizure provisions); G.S. 113-137(i) (forfeiture procedure).
14. Terrorism
    Real and personal property involved with the crime of terrorism is subject to forfeiture under G.S. 14-10.1. Property may be seized and forfeited as set forth in G.S. 14-2.3 and 14-7.20.