Skip to content

Assets Lost By Forfeit

If a financial institution loans money to a customer who is subsequently convicted of a crime, in some cases the customer's assets (cars, house, boat, etc.) can be seized by prosecutors under the asset forfeiture law.

However, most state's laws allow third parties (such as the financial institution) to assert their right to the property before it is sold.

It has come to light that some state prosecutors are ignoring the rights of the financial institution when property has been used as collateral for a loan. The latest case to gain attention was in Michigan, where the Michigan Supreme Court's decision was that third parties lost their rights.

The U.S. Supreme Court, which has already given favorable opinions to financial institutions in the past on this issue, will tackle the problem later this year. Their conclusion is important.

Copyright © 1995 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 5, No. 12, 8/95

First published on 08/01/1995

Filed under: 
Filed under operations as: 
Filed under security as: 

Banker Store View All

From training, policies, forms, and publications, to office products and occasional gifts, it’s available here:

Banker Store

hot right now

image description

Looking for effective, convenient training on a particular subject?

BOL Learning Connect offers more than 200 courses ON-DEMAND or on CD ROM from AML to Reg Z and every topic in between.

Search Topics