Federal law allows civil forfeiture, which means that the government can come in and seize cash, cars, or other items if there is belief those items could be involved in criminal acts. In fact, the Government can seize the property without the property owners even knowing they are charged with a crime.
This happened to Tarik Dehko, who owns a grocery store in Fraser, which is near Detroit.
The story starts last January, when Dehko said he thought he had been ripped off.
"I called the secretary to look at the computer, and she look at the computer, and I have $0 in my account," Dehko explained.
The checking account for his business had been completely wiped out. The IRS seized the money, more than $35,000. The federal government didn't like the way he was making deposits.
"The government did an inadequate investigation, never asked them why they deposit the money the way they do, instead, just came in, got an 'ex parte' warrant and took all the money," said Clark Neily, senior attorney for the Institute of Justice, who is representing Dehko.
Neily took over this case without accepting a fee because he said he feels Dehko's constitutional rights are being denied. Neily said Dehko did nothing wrong. He claims the store made many deposits because its insurance policy only covers losses up to $10,000. That meant they didn't want to have too much cash on hand.
"Doesn't allege that they earned the money in a criminal way, and it doesn't even allege they're doing anything wrong with the money. It just doesn't like the way they're depositing it. That is wrong," said Neily.
He said while the case winds its way through the legal system, which could be months or years, Dehko deserves to have his money returned. On Wednesday, he brought this argument to federal court in Flint.
"People who are good, legitimate businessmen, who are losing money to the government not because they did anything wrong but because the government doesn't like how they deposit money, it's wrong, it's not American, and it's unconstitutional," said Neily.
Government lawyers argued in court on Wednesday that they have proof that something wrong was going on, and they're within their rights to hold on to the money until a judge makes a final decision on the case itself.
The judge did not make a decision on whether to allow the money to go back to Dehko or to allow the government to hold on to it Wednesday night. He said he needs more time.
Neily said he's prepared to take this court to the Supreme Court because he feels business owners need to be protected.
Copyright 2013 WNEM (Meredith Corporation). All rights reserved.