Handbook 9.7
Asset Seizure and Forfeiture


Chapter 8
Storage of Seized Assets

Contents

[9.7] 8.1  (04-30-1998)
OVERVIEW

  1. The field point of contact for Criminal Investigation (CI) for the storage of assets is the Asset Forfeiture Coordinator (AFC) in the Internal Revenue Service (IRS) District. Each AFC is responsible for all forfeiture--related matters in his respective district. The following sections are addressed in this chapter:
    • Storage Of Assets Seized As Evidence
    • Storage Of Assets Seized Pursuant To Title 26
    • Storage Of Assets Seized Pursuant To 18 USC 981, 982 Or 984
    • General Procedures For Transferring Property To EG&G
    • Rules And Procedures Utilized To Transfer Personal Property Seized For Forfeiture To EG&G (Title 18 Seizures)
    • EG&G Management Of Stored Assets
    • Monthly Reconciliation Between IRS And EG&G
    • Storage Of Currency

[9.7] 8.2  (04-30-1998)
STORAGE OF ASSETS SEIZED AS EVIDENCE

  1. Agents and AFCs are to ensure that all property seized as evidence is stored securely. EG&G cannot be utilized to store assets seized solely for evidence. The storage facility must be secure storage with limited access. If a vendor is used to store vehicles, vessels, or aircraft, ensure that the contract calls for required maintenance to keep the asset in the condition in which it was seized.
  2. Access to the storage facilities will be limited to the seizing agents and a CI management official. An entry log will be maintained. The entry log should reflect the following:
    1. The dates of entry.
    2. The persons entering.
    3. A brief description of the purpose for entry.
  3. The entry log is to be kept in the CI seizure file.
  4. In emergency situations where the seized items must be stored in facilities belonging to another agency, a representative of the agency must sign a detailed inventory listing the seized items being stored by him/her on behalf of CI. The use of Form 9573, Custody Receipt for Retained or Seized Property (Exhibit 6-17), is recommended for use in these situations. This will ensure that the chain of custody is
    maintained.
  5. Special agents and AFCs will obtain receipts when seized property is stored in any public facility. Since the type of receipt to be obtained in storing other personal property will depend upon the circumstances involved, no receipt form is prescribed. If the storage facility does not provide a formal receipt, the seizing agent will prepare one for preservation in the seized property file.
  6. When a computer is seized, the stored data should be retrieved for evidentiary purposes by a CI computer evidence retrieval seizure specialist (SCERS). Once the evidence has been retrieved and secured, the seized computer shall remain in the custody or possession of the SCERS until all investigative matters have been completed. Once forfeiture proceedings have been concluded, the computer equipment should not be sold, transferred to a sharing agency, or placed into official use until a SCERS has "deleted" all data on the hard drive.
  7. If assets seized as evidence are to be maintained in the CI office, they need to be secured in a safe or locked evidence room. Procedures for access to these storage facilities are covered in paragraph (2) above.

[9.7] 8.3  (04-30-1998)
STORAGE OF ASSETS SEIZED PURSUANT TO TITLE 26

  1. The storage, towing, maintenance and repairs of assets for Code forfeitures must be arranged through District Support Services (DSS). IRS is responsible for all expenses associated with a Code forfeiture. The special agent or AFC responsible for the seizure will coordinate at the earliest date possible with the district fiscal function to ensure proper funding options. Under no circumstances will the Treasury Forfeiture Fund be used to pay for Code forfeiture expenses. Expenses may not be obligated by contract Counter Technology, Inc. (CTI) personnel.
  2. Seized vehicles, airplanes, vessels, and other personal property, except currency, financial accounts, financial instruments, or promissory notes, should be temporarily stored at the earliest practical date at a no-cost government facility.
  3. Access to the storage facilities will be limited to seizing agents and a CI management official. An entry log will be maintained as specified in
    8.2 (2).
  4. To effect the transfer of vehicles, vessels, aircraft, and other personal property to a vendor arranged by DSS, Form 9573, Custody Receipt for Retained or Seized Property, and Form 9572, Continuation Sheet (Exhibit 7-6), will be used as accountable documents for transfer of custody of seized assets. Special agents will enter the AFTRAK number in Block 2 and the Subject Seizure Investigation Number in Block 3 of Form 9573, and will complete all other applicable portions of the form when transferring custody of property. All receipts will be preserved as part of the Seized Property File.

[9.7] 8.4  (04-30-1998)
STORAGE OF ASSETS SEIZED PURSUANT TO 18 USC 981, 982 OR 984

  1. All property seized for administrative and judicial forfeiture pursuant to Title 18 USC 981 (civil forfeiture) and seized for judicial forfeiture pursuant to 18 USC 982 (criminal forfeiture) except as described below, should be transferred through United States Custom Service (USCS) to the custody of EG&G, Dynatrend, Inc. (EG&G). If the property has been identified (at the time of seizure) for official use or equitable sharing, consideration can be made for storage at that agency's facilities to save cost. The same procedures in section 8.2(2) above should be followed for access to these facilities. In addition, the asset can not be used by that agency until after the forfeiture proceedings are completed. No property seized for forfeiture pursuant to Title 18 USC sections 981, 982, or 984 will remain in the custody of IRS except possibly computers as discussed above.
  2. EG&G will not take custody of the following:
    1. Any drugs, currency, financial accounts, financial instruments, or promissory notes seized pursuant to Title 18 USC sections 981 or 982.
    2. Any type of weapon unless the weapon is stored in a sealed container and IRS maintains custody of the access (i.e., key, combination lock) to the sealed container. If a special agent considers seizing a sporting goods store, a gun dealer business, or any other type of business which will likely have numerous weapons or explosive devices, the agent should contact the district AFC during pre-seizure planning so that the seizure can be coordinated with USCS and EG&G. EG&G will need to make special arrangements to handle this type of seizure.
    3. If a special agent considers seizing property which he has any suspicion of containing hazardous materials or being contaminated or potentially contaminated (i.e., service stations, chemical or fuel supply or storage facilities, etc.), the agent should contact the district AFC during pre-seizure planning so that this potential problem can be discussed with USCS and EG&G. Generally, the property will not be seized until an environmental impact study has been completed, and the property cleared for seizure. If an environmental impact study has been done, this should be brought to the AFC's attention. See Chapter 6, Seizure Planning, in this Handbook for more information.
    4. Property held as evidence or property being forfeited under Title 26.
    5. Abandoned property.

[9.7] 8.5  (04-30-1998)
GENERAL PROCEDURES FOR TRANSFERRING PROPERTY TO EG&G

  1. The AFC (or IRS--designated representative) is the only local authorized contact point regarding forfeiture related matters with the USCS and EG&G. Counter Technology Inc. (CTI) personnel should not make the initial contact with the USCS or EG&G. Any contacts by CTI personnel with USCS or EG&G must be specifically approved by the district AFC.
  2. Each IRS district shall have on file with the USCS district office the name, title, and signatures of those persons (the AFC and his IRS--designated representative) who have signature authority to authorize transactions and to issue disposition orders in accordance with the Memorandum Of Understanding (MOU) and Implementation Plan reached between IRS and USCS. Through this plan, IRS will use EG&G, the contracted seized property custodian for the USCS, as its seized property custodian. All arrangements to have IRS seized property transferred to EG&G must be initially arranged by the IRS AFC through the USCS District Seized Property Custodian and Seized Property Specialist (SPC/SPS).
  3. The AFC will initially notify EG&G through the USCS SPC/SPS of an impending seizure as far in advance as possible. The AFC will provide the IRS subject seizure investigation number, the AFTRAK number and any special handling or storage requirements anticipated using Form 4008. If the seizure does not occur, the AFC will notify EG&G through the USCS SPC/SPS that the seizure has been cancelled.
  4. IRS will execute the appropriate court orders to effect the seizure of targeted assets. IRS will be responsible for posting the required notice of seizure and no trespassing signs on the seized assets.
  5. Upon acceptance of the property, USCS contracts to EG&G the responsibility for storing, maintaining, preserving and disposing of IRS seized property "in accordance with law" .
  6. Custody of seized property shall be considered transferred when all required notifications, coordination and documentation have been furnished to USCS and EG&G and Form 9573, Custody Receipt For Retained or Seized Property, is signed by the appropriate authorized persons.
  7. If notification, coordination and documentation, i.e., transfer of custody as stated in (6) above, takes place in a period longer than five (5) working days, then Form 4008 will be sent to Director of Support Services, Attn: Regional Controller and will require updating when the asset is transferred to EG&G. If notification, coordination and documentation have been furnished to USCS and EG&G within five (5) working days, Support Services does not need to be notified.
  8. After seized property is transferred to EG&G, the AFC or CTI representative should update Forms 4008 and 4008S for AFTRAK showing that the property is no longer in the possession of IRS. Form 4008S will be updated by circling the "D-Storage Contractor" entry in the "Storage Type" field. In addition, as appropriate, a memorandum will be forwarded by the Chief (CI) to the Director of Support Services, Attn: Regional Controller, in his region to remove the property from the General Ledger since it is no longer in the possession of IRS. The memorandum shall reference the Form 4008 initially sent to Fiscal Management to record the property when it was first placed in the Service's possession.
  9. EG&G shall manage and dispose of IRS real property and business enterprises in a manner consistent with USCS existing policies and procedures. This shall include, but not be limited to, acceptance, management and business services, maintenance, security, contract compliance reviews, and executing disposal requirements.
  10. For all seized property transferred to custody of EG&G, IRS retains all responsibility for processing of the forfeiture case, including notice of seizure, petitions and forfeiture.
  11. Certain conditions may preclude the use of EG&G for storage, maintenance and disposition of seized property. This may occur when the asset must be managed by a court-appointed substitute custodian, or for court--mandated manner or location of storage. If a person or entity other than EG&G is designated as the substitute custodian by a court order, TEOAF requests prompt telephonic notification to the Assistant Director, Policy and Operations, at (202) 622-9600. The telephonic contact should be made by the district AFC. This contact should be followed up with a memorandum to: TEOAF, Attention: Assistant Director, Policy and Operations, Suite 700, 740 15th Street, NW, Washington, D.C. 20220. A copy of this memorandum should be sent to the Assistant Commissioner (CI), Asset Forfeiture and Narcotics Section (CP:CI:O:N:A), 1111 Constitution Avenue, N.W. Washington, D.C. 20224.

[9.7] 8.6  (04-30-1998)
RULES AND PROCEDURES UTILIZED TO TRANSFER PERSONAL PROPERTY SEIZED FOR FORFEITURE TO EG&G (TITLE 18 SEIZURES)

  1. These procedures encompass seized or forfeited personal property of all types including vehicles, vessels, and aircraft.
  2. Accessories, equipment and spare parts required for the operation and/or maintenance of the property are normally included in the seizure of the property.
  3. All other contents, e.g., personal effects, personal property, tools in or on the property, or unclaimed, or abandoned by the defendant or occupant, shall be retained and processed by the IRS. These contents should be removed prior to transfer of custody of the seized asset. However, in cases where such contents are temporarily left in or on the property, an inventory shall be completed using EG&G Form 4052, Retained Personal Property or Detained Personal Effects Inventory and Receipt (Exhibit 7-9). Such contents will be stored in a suitable container within the conveyance consistent with security and environmental conditions. Removal shall be accomplished as soon as possible but no later than 15 days after the transfer of custody; or sooner, if the conveyance is forfeited and ready for disposal by issuance of a Customs Disposition Order. The IRS shall be responsible for compliance with abandonment procedures specified within agency regulations and the Federal Property Management Regulations (FPMR), 41 CFR, Section 101-45.5. See Chapter 11, Abandoned Property, in this Handbook for more information.
  4. Form 4008, Seized Property Report, in conjunction with Form 9573, will be used to consign seized property to EG&G through the Customs SPC/SPS as far in advance as possible prior to the time of transfer.
  5. The AFC will note "Consignment Order" on top of a copy of the Form 4008 containing the information below (when applicable):
    1. Subject Seizure Investigation Number.
    2. Asset Seizure Number (AFTRAK Number).
    3. Name, Title and Telephone Number of IRS Contact Person (AFC or Seizing Agent).
    4. Location of Seized Asset to be Transferred.
    5. Seized Asset Operational Status (if applicable).
    6. Keys available (if applicable).
    7. Hazardous property/material associated with the seized asset.
  6. The AFC will then fax the 4008 to the SPC/SPS with the following:
    1. Copies of the seizure order (do not include seizure warrant affidavits or documents under seal).
    2. Copies of inventories, Form 181 (Exhibit 6-18).
    3. Copies of third party appraisals, Form 226A, with any appropriate attachments (Exhibit 8-1).
  7. If these documents are not available when the consignment order is faxed, they should be made available at the time of transfer to EG&G.
  8. The AFC will provide the USCS SPC/SPS with any and all public record lien information pertaining to the subject seized asset prior to or at the time of transfer to EG&G. The SPC/SPS will provide EG&G with the documents which will be provided to the National Finance Center when the sales package is forwarded to the auction team for processing, or when the National Finance Center otherwise requests the
    documentation.
  9. Public record lien data discovered after the transfer of the asset to EG&G shall be promptly provided to the SPC/SPS by the AFC for processing.
  10. For non-sale lien situations, such as retention for official use or transfer to other agencies, the applicable lien documentation will be presented to the SPC/SPS for forwarding to the National Finance Center, Auction Team.
  11. Both the IRS and USCS shall strive to have EG&G accept transfer of custody of the property immediately following seizure. EG&G shall respond to the IRS request for transfer of property no later than three (3) working days following the request or a date agreed upon.
  12. IRS will use Form 9573, Custody Receipt for Retained or Seized Property and Form 9572, Continuation Sheet (Exhibits 6-17 & 7-6), as accountable documents for transfer of custody of seized assets. Special agents will enter the AFTRAK number in Block 2 and the Subject Seizure Investigation Number in Block 3 of Form 9573, and will complete all other applicable portions of the form when transferring custody of property.
  13. Property shall be transferred in person, at a site of mutual agreement, between an IRS representative (AFC, special agent, or group manager) and EG&G, or its subcontractor. An inspection and 100% inventory shall be completed by the IRS and EG&G, or its subcontractor, to ensure that the correct description, serial numbers, license or registration numbers, and condition (including damage) are accurately recorded. EG&G, or its subcontractor, will provide the IRS representative a copy of either of the following forms (depending upon the type of asset transferred) to establish the property condition for which EG&G will be accountable:
    • EG&G Form 4006, Aircraft Condition and Inventory (Exhibit 6-19).
    • EG&G Form 4007, Vehicle Condition and Inventory (Exhibit 6-20).
    • EG&G Form 4008, Vessel Condition and Inventory (Exhibit 7-7).
    • EG&G Form 4033, General Property Condition and Inventory (Exhibit 7-8).
  14. Differences discovered between the initial IRS inventory and the on-site joint inventory will be resolved at transfer. The IRS representative will, if possible, photograph/videotape the property and its condition. After inspection, EG&G will sign and retain Form 9573 to accept custody of the property. The original Form 9573 will be returned to IRS through the SPC/SPS upon disposition of the seizure or if the property is returned to IRS for other reasons.
  15. IRS shall give a copy of Form 181 (Exhibit 6-18) or Form 226A (Exhibit 8-1), as appropriate, to EG&G, or its subcontractor, when transferring custody of the property to EG&G.
  16. EG&G will record the SEACATS generated seizure number directly below the title at the top of Form 9573, and directly above the title of IRS Form 4008 and will record the property storage location at the bottom of the IRS Form 4008.
  17. A copy of Form 9573 will then be returned, through the SPC/SPS, to IRS. A copy of IRS Form 4008 will then be faxed to the Customs SPC/SPS and IRS AFC within 1 working day after the property has been stored. EG&G will notify IRS of a new location through the process noted above.

[9.7] 8.7  (04-30-1998)
RULES AND PROCEDURES USED TO TRANSFER REAL PROPERTY AND BUSINESS ENTERPRISES SEIZED FOR FORFEITURE TO EG&G

  1. These procedures encompass seized or forfeited real property of all types including, but not limited to, residential and commercial structures, vacant land, and business enterprises.
  2. The seizure of real property shall be in strict accordance with the terms of the seizure or forfeiture order. The seizure or forfeiture order should include language authorizing the seizure of the real property. Contents (personal effects and personal property) located in structures or on the real property shall not be seized unless specifically stated in the order. Seized vehicles and vessels involved in a real property seizure will be managed in accordance with the transfer of personal property.
  3. All other contents, whether seized by the IRS or unclaimed or abandoned by the defendant or occupant, shall be retained and processed by the IRS. In cases where such contents are temporarily left in or on the real property, removal shall be accomplished as soon as possible but no later than 90 days after the transfer of custody; or sooner, if the property is to be occupied, or if forfeited and ready for disposal. The IRS shall be responsible for compliance with abandonment procedures specified within IRS regulations and the FPMR (41 CFR, Section 101-45.5). See Chapter 11, Abandoned Property, in this Handbook for more information.
  4. Some judicial districts require title reports and preliminary appraisals prior to executing a complaint. EG&G will provide this service. This title report will reflect all liens and encumbrances to assist in determining the potentially interested parties. Notify EG&G through Customs by filing a Form 4008 with "Consignment Order" noted on top of the form that the real property is subject to forfeiture and a title search can be performed. If an agent does not want EG&G or an EG&G subcontractor to make a visual inspection of the real property, the agent should give specific instructions in the Facts and Circumstances Section of the Form 4008 regarding "no inspection of the property should be made by EG&G personnel or subcontractors, perform pre-seizure work only" . (See Chapters 6 & 7 on Seizure Planning and Processing Seized Assets, in this Handbook.)
  5. Occupancy issues are also of vital concern. If the property is vacant, EG&G will obtain a property manager and possibly initiate rental agreements on a month--to--month basis. If the property is occupied and not vacated upon forfeiture, it will be necessary for the IRS to enter into a post forfeiture occupancy agreement (Exhibit 6-21), with the Chief (CI) being the approving official. Occupancy agreements can be obtained from the AFC.
  6. Occupancy agreements, signed by the IRS in criminal cases, should be obtained, along with a substitute custodial order naming the IRS as the custodial agency (Exhibit 6-21). TEOAF Directive 13 pertains to occupancy agreements, which includes various restrictions (maintenance, access to the property, potential for continued illegal activity, insurance, etc.) and addresses Treasury Department concerns. The language of this document is intended to enhance the government's position in necessary evictions.
  7. Occupancy agreements should also be obtained when exigent circumstances exist and the court has authorized the seizure of real property prior to a finding of forfeiture after the owner has been afforded an opportunity to be heard, and occupants of the property are permitted to remain in the property pending forfeiture for what may be an extended period.
  8. Special or unique requirements that cannot be accommodated or resolved at the local level shall be addressed through the Problem Resolution provisions of the MOU. The contents (personal property) described below shall be accepted by USCS and EG&G only if the items are specifically included in the real property seizure or forfeiture order.
    1. Normal household furnishings.
    2. Livestock (other than exotic animals and pets) normally resident on a farm or ranch (See TEOAF Directive 15).
    3. Agricultural implements and equipment and feed if needed to care for crops, produce, or livestock located on a farm/ranch
    4. Property maintenance equipment if needed to care for the property.
  9. IRS shall provide the following documents to the SPC/SPS at the time of seizure:
    1. Copy of warrant which authorizes the IRS to enter the property for seizure, management and disposal purposes and which identifies EG&G as the substitute custodian of the property.
    2. Copy of Substitute Custodial Agreement.
    3. Writ of Entry, if applicable. (This should be applied for all real property once a Post & Walk has been performed.)
  10. IRS shall post appropriate IRS seizure notices on the property at the time of seizure.
  11. Forms 4008 and 9573 will be used to consign seized property to EG&G through the SPC/SPS as far in advance as possible prior to the time of transfer. Form 4008 will include the following information, when applicable:
    1. Subject Seizure Investigation Number.
    2. Asset Seizure Number (AFTRAK Number).
    3. Name, Title and Telephone Number of IRS Contact Person (AFC or Seizing Agent).
    4. Location of Seized Asset to be Transferred.
    5. Legal Description of the Property.
    6. Type of Real Property/Business Enterprise (vacant land, occupied residential, unoccupied residential, operating commercial, or non-operating commercial).
    7. Keys available.
    8. Hazardous property or material associated with the seized asset.
  12. The AFC will then note "Consignment Order" on top of a copy of the Form 4008 and fax it to the SPC/SPS for fax to EG&G. The same steps reflected in this chapter, section 8.6(6) through (11) will be followed for real property.
  13. Property shall be transferred in person at a site of mutual agreement between an IRS representative (AFC, special agent, or group manager) and EG&G, or its subcontractor. An inspection and 100% inventory shall be completed by both parties to ensure that the correct legal description and condition (including damage) are accurately recorded. EG&G or its subcontractor will provide the IRS representative with a copy of EG&G Form 4048, Real Estate Condition and Inventory (Exhibit 8-2), containing this information and establishing the condition of the property for which EG&G, or its subcontractor, will be accountable. (The IRS representative accompanied by EG&G will conduct an inspection and inventory of the property and photograph or videotape the property and its condition when possible.) Differences between the initial IRS inventory and the on-site joint inventory will be resolved at transfer. After the inspection, EG&G or its subcontractor will sign Form 9573 accepting custody and responsibility for the property. The IRS representative will also sign Form 9573.
  14. After the Complaint for Forfeiture has been filed, the AUSA should prepare and serve a Rule 34 Request for Inspection (FRCivP). At the appropriate time, preferably within 45 days of the filing of the complaint, an agent and the appraiser will inspect the property.
  15. EG&G will record the SPMS generated seizure number directly below the title at the top of Form 9573, and directly above the title of IRS Form 4008.
  16. A copy of Form 9573 will be returned to the IRS through the SPC/SPS. A copy of IRS Form 4008 will then be faxed to the Customs SPC/SPS and IRS AFC within one working day.
  17. The Form 9573 will be returned to IRS through the SPC/SPS upon disposition of the seizure and/or if the property is returned to IRS for other reasons.

[9.7] 8.7.1  (04-30-1998)
Business Seizures

  1. Typical services for business enterprises include:
    1. Audit.
    2. Appraisal.
    3. Ongoing financial monitoring.
    4. Management.
    5. Disposal.
  2. Absent any court-imposed requirements, the EG&G shall make recommendations to IRS whether to operate or close an IRS seized or forfeited business enterprise based on audit or appraisal results, a business viability assessment, and when appropriate, a business operating plan. Business income, if any, shall be handled in the same manner as rental income. Creditors and lienholders shall be paid in accordance with the provisions of Title 28 CFR Part 9. Taxes and mortgages shall be paid in accordance with TEOAF Directive 12. The USCS shall handle the infusion of capital into an IRS seized or forfeited business in the same manner as it does for non-IRS seized or forfeited businesses.
  3. Upon request of the district AFC, EG&G will provide monthly operating reports of business enterprises to the AFC.
  4. The SPC/SPS shall provide the AFC with the management and disposition documents required. The AFC shall provide the SPC/SPS with required administrative and management documentation.
  5. See Chapter 6, Seizure Planning, in this Handbook concerning perishable goods.

[9.7] 8.7.2  (04-30-1998)
Contaminated Property

  1. It is the policy of the Departments of Treasury (TEOAF Directive 7) and Justice that property, which is contaminated or potentially contaminated with hazardous substances, may be seized and forfeited only upon a determination by the U.S. Attorney in the district where the property is located. This decision will be made in consultation with the seizing agency and the contractor, in consultation with the seizing agency and EG&G.
  2. Once a potentially contaminated property has been seized, an environmental study should be initiated immediately. If it is determined the cost to correct any problems would exceed the property's net equity, the Chief (CI) should proceed to quick release the property, unless there is an overriding law enforcement purpose not to do so.
  3. IRS will make every effort not to seize contaminated or potentially contaminated property. Property that the USCS finds contaminated after it takes custody shall be managed and disposed of following TEOAF Directive 7 and USCS procedures. The AFC shall immediately notify the SPC/SPS about the contamination and request USCS recommendations in writing.
  4. Additionally, Policy Directive 30, Interim Guidelines re: Lead-Based Paint in Residential Property Built Prior to 1978, requires that approval be obtained from the TEOAF. Without TEOAF approval to proceed with the seizure and/or sales disposition of the potentially contaminated property, EG&G will not accept or sell the real property. Policy Directive 30 should be referred to for additional procedural instructions related to the seizure of property with lead-based paint.

[9.7] 8.8  (04-30-1998)
EG&G MANAGEMENT OF STORED ASSETS

  1. EG&G shall be responsible for storage location and maintenance of the seized and/or forfeited assets.

[9.7] 8.8.1  (04-30-1998)
EG&G Management of Stored Personal Property

  1. EG&G shall notify the AFC and the SPC/SPS as to the initial location and any subsequent relocation of the assets. The notification shall be in writing (facsimile acceptable) and shall be provided within 1 working day from the date of relocation.
  2. EG&G, upon receipt of an asset, shall establish a Property Custody Package (PCP) for each seizure. The PCP will contain:
    1. Photographs.
    2. An original copy of the transfer document (Form 9573).
    3. A complete description of the asset including identification and serial numbers, license and registration numbers
    4. Damages (if any).
    5. A description of the condition of the assets.
    6. The inventory.
    7. A maintenance plan (if required).
  3. IRS shall provide an estimated appraised value (block 4 of Form 4008) of seized or forfeited assets prior to transfer to EG&G by using a recognized guidebook or a certified appraiser. The AFC will immediately provide a copy of the appraisal to the SPC/SPS for delivery to EG&G. The AFC may ask EG&G for assistance in establishing an estimated appraised value. EG&G shall appraise IRS seized and forfeited assets. If the IRS and EG&G appraisals vary by 25% or more, EG&G will notify the AFC. The AFC may provide concurrence through the SPC/SPS to EG&G, otherwise, the appraisal value provided by the AFC will be used by EG&G if a value cannot be agreed upon.
  4. EG&G will generally recommend routine maintenance for vehicles valued greater than $2,500.00 to begin after the first 60 days of storage. EG&G will provide the AFC a proposed maintenance plan within thirty (30) days of acceptance of conveyances. The AFC will concur or not concur with the plan and return it to EG&G through the SPC/SPS.
  5. Vehicles intended for sale can be repaired using funds from the Treasury Asset Forfeiture Fund. EG&G will propose to the IRS AFC those reasonable repairs that will enhance the salability of conveyances. The AFC will forward his concurrence or other recommendations to EG&G through the SPC/SPS. Repairs cannot exceed 20% of the wholesale value of the conveyance.
  6. If a vehicle will be placed into official use, the retrofitting repairs may be made using the discretionary portion of the Treasury Asset Forfeiture Fund after the forfeiture. These funds may be requested through the Asset Seizure Forfeiture Section, Headquarters.
  7. If a vehicle will be equitably shared, the repairs will be done by and at the cost of the receiving agency.
  8. EG&G will enter property data into the Seized Property Management System (SPMS). All reporting requirements, such as inventory, monthly costs, etc., will be provided to the IRS and the USCS.
  9. Access to IRS property in USCS custody shall be limited to USCS personnel and EG&G (USCS contract personnel) essential to manage and dispose of or to market the property as necessary, unless otherwise authorized.
  10. If access to stored property is required, the AFC shall request access from the SPC/SPS via form letter (Exhibit 8-3) (fax copy is acceptable). The names, titles and organization of all individuals requiring access and the specific purpose (exactly what needs to be done) of the requested access (e.g., photograph, inspect, etc.), and the location where the property is being stored must be included in the request. The SPC/SPS shall respond to the request and prepare and forward the necessary disposition order to EG&G within 1 working day of receipt.

[9.7] 8.8.2  (04-30-1998)
EG&G Management of Real Property

  1. EG&G, upon receipt of an asset, shall establish a Property Custody Package (PCP) for each seizure. The PCP will contain:
    1. Photographs.
    2. An original copy of the transfer document (Form 9573).
    3. A complete legal description of the real property or business
      enterprise.
    4. Damages (if any).
    5. A description of the condition of the assets.
    6. The inventory.
    7. A maintenance plan (if required).
  2. IRS shall provide an estimated appraised value (block 4 of Form 4008) of seized or forfeited assets prior to transfer to EG&G. The AFC may contact EG&G for assistance in establishing an estimated appraised value. EG&G shall appraise IRS seized or forfeited assets in the same manner used for USCS seizures by using either a recognized guidebook or a certified appraiser. The AFC shall immediately provide a copy of the appraisal to the SPC/SPS for delivery to EG&G. The SPC/SPS shall obtain the concurrence of the AFC prior to obtaining third party appraisals for property to be sold. If the IRS and EG&G appraisals vary by 25% or more, EG&G will notify the AFC. The AFC may provide concurrence through the SPC/SPS to EG&G, otherwise, the appraisal value provided by the AFC will be used by EG&G if a value cannot be agreed upon.
  3. EG&G will propose to the IRS AFC those reasonable repairs that will enhance the salability of real property or business enterprises. The AFC will forward his/her concurrence or other recommendations to EG&G through the SPC/SPS. Repairs to real property cannot exceed 15% of the appraised value or $10,000, whichever is less, unless a memorandum is sent by the district AFC to TEOAF for forwarding to the Contracting Officer (USCS) requesting approval for excess repairs. The memorandum should set forth the anticipated cost of repairs and how these repairs will enhance the salability of the real property. A copy of the request and reply should be retained in the Seizure Property File.
  4. EG&G will enter property data into the SEACATS. All reporting requirements, such as inventory, monthly costs, etc., will be provided to the IRS and the USCS.
  5. Access to IRS real property or business enterprises in EG&G custody shall be limited to USCS personnel and EG&G (USCS contract personnel) essential to manage and dispose of or to market the property as necessary, unless otherwise authorized. If access to stored property is required, the procedures set forth in the prior subsection shall be used.
  6. If the net equity of the property declines to 20% of its appraised value, the SPC/SPS will notify the AFC and request written guidance on appropriate action to take.
  7. After a preliminary order of forfeiture and prior to a final order of forfeiture, or upon the filing of a stay of forfeiture, occupants of real property may be permitted to remain in the property pending the forfeiture. Occupancy agreements, signed by the IRS in criminal cases (Exhibits 6-23 & 6-21), should be obtained, along with a substitute custodial order naming the IRS as the custodial agency.
  8. See Chapter 6, Seizure Planning, in this Handbook for evictions on seized real property if that becomes necessary.
  9. If the property is rented while in the custody of EG&G, the rental income shall not be used to pay expenses or mortgages. Rental of the property will be in accordance with TEOAF Directive 13 regarding executed occupancy agreements.

[9.7] 8.9  (04-30-1998)
MONTHLY RECONCILIATION BETWEEN IRS AND EG&G

  1. Each district AFC should maintain a log and retain copies of all Forms 9573, Custody Receipt for Retained or Seized Property, and Form 9573, Continuation Sheet, Custody Receipt for Retained or Seized Property, of all property, including real estate and business enterprises, transferred to EG&G in administrative and judicial seizures/forfeitures.
  2. EG&G will provide Form 504, Monthly Inventory Report, to each IRS AFC identifying IRS property transferred to EG&G. This report should be received and retained by every district AFC having at least one asset in the custody of EG&G during the reporting period.
  3. By the 15th of the following month, each district AFC shall reconcile their retained Forms 9573 to Form 504 received from EG&G and note the reconciliation date and initial the Form 504. Discrepancies shall be resolved between the district AFC and the USCS SPC/SPS or with EG&G, or will be reported by the AFC to Headquarters, Asset Seizure Forfeiture Section.
  4. District AFCs will ensure that all transfers of property to EG&G are timely and accurately reflected on AFTRAK.

[9.7] 8.10  (04-30-1998)
STORAGE OF CURRENCY

  1. All seized domestic and foreign currency, except when held as evidence or held as a collectible item, must be expeditiously counted, processed, and deposited to the U.S. Customs Suspense Account within 5 (five) days of seizure. The use of safe deposit boxes, safes, or other similar methods of storing seized currency, is acceptable, when necessary, for overnight storage.

    Exhibit [9.7] 8-1  (04/30/98)
    Sample Form 226A, Appraisement List

Exhibit [9.7] 8-1  (04/30/98)
Sample Form 226A, Appraisement List
>
INSTRUCTIONS TO FORM 226-A
1) This form is to be used in all cases where seized property is required to be appraised pursuant to 26 U.S.C. 7325 or 18 U.S.C. 981.
2) In cases where appraisals are made by three disinterested appraisers pursuant to the Internal Revenue Laws, the space so designated should be executed.
a) In the event the appraisers differ in their estimates of the aggregate value of the seized property, each shall indicate his/her appraisal figure beside his/her signature and the appraised value shall be the average of the three figures.
3) In cases where appraisals are made by seizing officer, the space designated Appraisal by the Seizing Officer, should be executed.

Exhibit [9.7] 8-2  (04/30/98)
EG&G FORM 4048, REAL ESTATE CONDITION AND INVENTORY

Exhibit [9.7] 8-2 (Cont.)  (04/30/98)
EG&G FORM 4048, REAL ESTATE CONDITION AND INVENTORY
Exhibit [9.7] 8-3  (04/30/98)
Request To Access Seized Property
>
INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
District
Director Criminal Investigation
Person to Contact:
(Name of SPC/SPS) Joe Smurf, Special Agent
(Address of Receiver) Telephone Number:
(City, State, Zip) (xxx) 123-4567
Refer Reply To:
CI:x:xxx
Date:
(enter today's date)
RE: Access to Seized Stored Property
    Asset Description:
    SPMS #: IR  ________
    Seizure Number:  _______
Exhibit [9.7] 8-3  (04/30/98)
Request To Access Seized Property
>
Dear (SPC/SPS Name):
It is requested that access to the above-referenced seized/stored property be granted to:
(Individual(s))
(Names)		 (Title(s) of)
(Individuals)		 (Individuals(s))
(Organization(s))
Access to the is needed for the purpose of (e.g., photograph, inspect, etc.) the property. The property is presently being stored at (Insert specific location) .
Should you have any questions relative to this request please contact me at the above listed telephone number.
Asset Forfeiture Coordinator
*SPC/SPS name and address assigned to your location.

Internal Revenue Manual  

Hndbk. 9.7 Chap. 8 Storage of Seized Assets

  (04-30-1998)


05/02/2001 14:30:01 EST