Egregious and systemic government and third-party overstepping takes place every day, and while you might not personally experience it, it’s very much alive and thriving. Fundamental rights which we, as human beings, are guaranteed under the Universal Declaration of Human Rights and our respective state constitutions, are being eroded and chiseled away, whether it be explicitly or surreptitiously.
Voice, choice, and autonomy have all but been chosen for not only the 3 billion plus persons living on less than USD $2.50 per day by a concentrated few, but nearly everyone in one way or another - whether it’s due to government overreach, third-party missteps, or censorship.
But, what if that didn’t have to be the case?
What if marginalized, ostracized, voiceless, and even seemingly average persons were able to recoup a sliver of independence and self-determination from the encroaching and limiting monoliths?
Well...that would be a start - a drop in the bucket toward self-liberation from autocratic and overarching rule, but still a drop in the bucket.
However, slowly, tiny droplets of hope, empowerment, and individual settlement begin to accumulate, reaching a tipping point, whereby the entire bucket begins to yield to its newly acquired weight and guidance. With privacy-preserving cryptocurrencies and tools, we can only hope to set the wheels in motion for the gradual overhaul of such systems.
To best convey why privacy-preserving cryptocurrencies, mechanisms, and networks are at the very crux of the furtherance of guaranteed basic rights, it’s better to show you, rather than tell you, why they are in such dire need in today's flawed financial landscape.
In this first article of a three part series, I’m going to walk you through the current framework of the United State’s civil forfeiture laws, several examples of these inequitbale laws, and how Monero can be used to better serve the people by providing refuge. In part two, I will address how it can empower South Sudanese to realize purchasing power in a time of macroeconomic collapse, and part three will explore examples of banks freezing assets, how it poses a threat to individual soveriegnty, and the solution that Monero offers.
Civil Forfeiture in the United States
“The idea of going at people through their property has a long history. The theories are quite old. The prevalence of the practice is comparatively recent.”
Daniel C. Richman (1999)
Simply put, civil forfeiture refers to the legal process whereby enforcement officers “seize” assets (money, property, and other tangible assets) from individuals suspected of engaging in criminal activity. Sounds noble, right? After all, wouldn’t the world be a much better place if we were able to prevent crime before it even occurs? While perhaps sound in theory, this ill-defined and invasive legal process has unfortunately led to countless issues and gross government overreach.
With roots in British maritime law and dating back to the 1600s, civil forfeiture has become a billion dollar government industry over the last 30 years, supporting an increasingly upward and aggressive trend towards the excessive - jumping from roughly $93.7 million in assets and money seized in 1986 to over $2.5 billion by 2010.
And while there may be merit, probable cause, or preponderance of the evidence (U.S. states differ in their respective standards of proof for forfeiture laws) in favor of the seizure of some assets, estimates place unwarranted and frivolous civil forfeiture instances over the years at roughly 85%. In 2010 alone, there were an estimated 11,000 non-criminal forfeiture cases in the United States, with just over 1/10th of those ever being challenged in federal court. One estimate by SFGate writer, Stewart M. Powell, places the percentage of federally seized property returned to owners at a meager 1%.
It’s also worth noting that in some U.S. states, “Equitable Sharing” exists, a program whereby proceeds of liquidated seized and forfeited assets are distributed amongst state and federal law enforcement authorities. In 2010, more than $500 million was shared amongst officers and agencies through the Equitable Sharing program, with over $5 billion having been distributed since the program’s inauguration in 1984 - a slush fund for the anointed. If you’re thinking such funds are only exercised for the advancement of policing activities, you’d be dead wrong - law enforcement officers and officials have also used such “equitably shared” funds to subsidize expensive parties, dinners, and personal expenses.
Recourse is difficult for the average person subjected to this civil rights chopping block. And, incentive to overstep is ripe for those at the legal helm.
Three Notable United States Civil Forfeiture Cases
In 2013, a Mississippi man was pulled over by local police for a routine traffic stop which turned into anything but routine. After searching the vehicle of the car, a Mississippi officer found $360,000 stashed in a secret compartment of the car. I’m sure you can guess what happens next. The money was confiscated by police, however proof of a committed crime was never actually furnished.
In the same year (2013), a Georgia woman, Alda Gentile, and her son were pulled over (her son was the one driving) for speeding. Georgia police searched the car for drugs, and ultimately found and seized $11,530, which Gentile noted was for a house-hunting trip in Florida. Gentile was never charged with a crime, and was returned her money a week later.
In 2014, Christos and Markella Sourovelis, parents of a 22-year-old, were in for a surprise after the police showed up at their door, arresting their son for the sale of $40 worth of heroin. Authorities accused the son of selling drugs out of their home, something both parents emphatically denied any knowledge of. Nearly two months later, the police returned to seize their house - power was turned off, doors were locked and bolted, and the family was forced out onto the street for the day.
Police and prosecutors adamantly argued that because their son had been selling drugs out of the house, it was subject to state civil forfeiture laws. After an unconscionable courtroom battle (due to imbalanced bargaining power and due process) and eight days of staying with family, the Sourovelises were allowed back into their house under the condition that they permanently ban their son from it.
Keep in mind, this is just a fraction of the billions which are seized every year in unlawful ways.
How Monero Can Serve the People & Insulate From Inequitable Civil Forfeiture Laws
Monero, a secure, fast, and - most importantly - private digital currency, stands to benefit those who might otherwise fall prey to constitutional violations and broad, pernicious interpretations of the law.
Regarding inequitable civil forfeiture laws of the United States (and a minority of other jurisdictions), Monero specifically avails itself to prevent the following:
- Predatory Government & Police Behavior, and
- Disproportionate & Arbitrary Punishment.
Let’s take a brief look at how Monero may be used to prevent both.
Predatory Police & Government Official Behavior
As we noted with the United States ‘Equitable Sharing’ program employed by some states, the system incentivizes abusive and predatory police and official behavior, as government officials and agencies freely operate with often unvetted impunity. Liquid assets, such as money, jewelry, vehicles, and houses offer a tempting grab for officials, with two of the four giving rise to a high presumption of illegal activity in police eyes. Cash and jewelry are also easily converted to police equipment and other instruments.
Furthermore, most states and the federal government sanction law enforcement agencies and officials to keep 90% of profits from forfeited assets, giving rise to a clear profit motive, which in turn, taints the core of the forfeiture ethos.
But, what if an individual’s assets and worth is held in digital form?
If there’s no tangible asset in plainview of an officer or official, the likelihood of search and seizure significantly decreases.
Cue Monero and other privacy-preserving coins. While most P2P cryptocurrencies and pseudo-anonymous cryptocurrencies are a step in the right direction towards emancipation from today’s predatory and long-arm civil forfeiture laws and enforcement, they are still not immune - having been monitored and tracked to some degree by private companies and government agencies through UTXOs.
Monero, on the other hand, operates using substantial differences (from Bitcoin) in blockchain obfuscation, through the CryptoNote protocol - whereby ring signatures hide a spender’s input among multiple other possible inputs, increasing difficulty in establishing links with following transactions. While Malte Möser of Princeton University noted that roughly 62% of Monero transactions were vulnerable to a disentangling analysis (in April, 2018), it was not for lack of protocol inadequacies, rather human error and sloppy privacy practices.
Via CryptoNote’s ring signatures, should law enforcement and officials seize a computer (or 130), they will ultimately fail in attempted decipher of fund origination, due to everyone in a group signing pool being a potential signatory. Emphatically, Monero’s fungibility removes any “unique identifier which can tie a single XMR coin’s transactions through time.” And, there's no compromise of third-party privacy in a measurable way, due to no true link between parties. Thanks to Monero, both sender and receiver identity is cryptographically protected, along with the sum transacted.
When there’s near zero chance (should human handling error be eliminated) of officials and law enforcement ever recovering one’s XMR, the likelihood of subverting state law to cooperate with federal authorities to further equitable sharing agreements will likely decrease.
Disproportionate & Arbitrary Punishment
As a result of decreased police and government official predatory behavior, so too will the disproportionate (and oftentimes arbitrary) punishment of forfeiture lessen. With fewer tangible assets to claim and attribute to illicit activities, the potential levy and execution on such assets is far less likely.
Under the Excessive Fines Clause (applicable to state and local governments under the Due Process Clause) of the Eighth Amendment of the United States Constitution, federal, state, and local government imposition of excessive bail, cruel and unusual punishments, and fines is prohibited. However, as we’ve seen from the above examples, the codified prohibition of excessive fines ultimately falls short in today's legal landscape.
Untraceable digital currencies, such as Monero, tender unprecedented privacy to those storing life-changing amounts of money, which otherwise might be removed via excessive fine and never reimbursed. The mass adoption and use of privacy-preserving cryptocurrencies also lends itself to a potential decrease in exorbitant and sustained court battles to recover property (as there is no traceable property to go after), battles that the “politically weak” and financially poor often are unable to contest.
Monero stands to act as a marble plinth of equity in the courts, should an individual ever find themself in such a prejudiced legal fight for what is rightfully theirs.
While cryptocurrencies do authorize never-before-seen ways to protect oneself against egregious government overreach, it’s important to understand that not all coins support the same levels of functionality and protection.
Monero embodies a true privacy coin which separates itself from the likes of Bitcoin, due to its core focus on privacy and fungibility, and provides an extra layer of protection for individuals who may have their computer and crypto seized and surveilled by government officials. Additionally, it provides a platform for users to securely store funds that might otherwise fall prey to excessive fines in tangible and changeable form.
As noted above, change is not effective immediately, and it takes time for a bucket to fill with rain drops before swaying in favor of the water’s direction. Just as civil forfeiture missteps and abuse won’t vanish overnight, Monero and other privacy coins offer refuge for the subdued.