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A project of Common Dreams

For Immediate Release
Contact:

Rachel Myers, (212) 549-2689 or 2666; media@aclu.org

Federal Court Finds Freezing of Charity's Assets Unconstitutional

Ruling Means Congress Must Fix Law That Allows Treasury to Shut Down Organizations Without Judicial Warrant

TOLEDO, Ohio

A federal court ruled late Monday that the
U.S. Treasury Department's freezing of a charity's assets was
unconstitutional and that in order to comply with the Constitution,
Congress must fix the law to require a warrant be obtained based upon
probable cause before taking such action. The court also found that the
Treasury Department's failure to give the charity notice of the basis
for freezing its assets violated the Constitution by preventing the
charity from being able to meaningfully respond to the freeze.

Monday's ruling came in a lawsuit
filed in November 2008 by the American Civil Liberties Union, the ACLU
of Ohio and several civil rights attorneys on behalf of KindHearts for
Charitable Humanitarian Development, Inc., an Ohio-based charity. The
U.S. Treasury Department's Office of Foreign Assets Control (OFAC) froze
KindHearts' assets four years ago without a warrant, notice or a
hearing, based simply on the assertion that OFAC was investigating
whether the charity should be designated as a "specially designated
global terrorist" (SDGT).

"This landmark decision reaffirms the
basic principle that the government may not simply ignore the
Constitution's warrant and probable cause requirements in the name of
national security," said Alexander Abdo, an attorney with the ACLU
National Security Project. "By requiring Congress to step in and fix the
government's unconstitutional terrorist-designation scheme, the ruling
restores a critical check on executive power. No longer will the
government have the authority to shut down a domestic organization's
operations and to criminalize all transactions with the organization
based merely on the say-so of the executive."

KindHearts has never been found to
have engaged in any wrongdoing and has never been designated an SDGT,
yet it has been effectively shut down since OFAC first froze its assets
on February 19, 2006. As a result of the freeze pending investigation,
it is a crime for anyone to do any business with KindHearts and the
charity has no access to its own property.

"For years, the government has
insulated its terrorist-designation decisions from any meaningful review
by denying the frozen charities even the most basic constitutional
requirements of due process," said Georgetown Law Professor David Cole,
co-counsel for KindHearts. "Yesterday's decision confirms that such
freezes are unconstitutional by requiring the government to provide
KindHearts what it has been denied all along - a fair chance to clear
its name."

In Monday's ruling, U.S. District
Judge James G. Carr of the Northern District of Ohio, Western Division,
held that going forward the administration must obtain a warrant based
on probable cause before seizing an organization's assets. In
KindHearts' case, the court held that the government must remedy its
failure to get a warrant in this case by demonstrating that it had
probable cause at the time it froze KindHearts' assets.

Judge Carr also ruled that OFAC
violated the Fifth Amendment's guarantee of due process by failing to
provide KindHearts notice of the charges against it or a meaningful
opportunity to respond. He held that OFAC must remedy these failures by
declassifying or adequately summarizing the classified evidence against
KindHearts or by allowing KindHearts' counsel to view the classified
evidence pursuant to security clearances and a protective order.

KindHearts' founders established the
charity in 2002 - after the government shut down a number of other
charities - with the express purpose of providing humanitarian aid both
abroad and in the United States in full compliance with the law. Despite
the efforts KindHearts took to implement OFAC policies and even seek
its guidance, OFAC froze KindHearts' assets in February 2006.

In addition to Abdo and Cole,
attorneys on the case, KindHearts v.
Geithner, are Ben Wizner of the ACLU, Fritz Byers of Toledo,
Ohio, Lynne Bernabei and Alan Kabat of Bernabei & Wachtel, PLLC in
Washington and Carrie Davis of the ACLU of Ohio.

The ruling is available online at: www.aclu.org/national-security/kindhearts-charitable-humanitarian-development-inc-v-geithner-et-al-order


More information about the case is
at: www.aclu.org/national-security/kindhearts-charitable-humanitarian-development-inc-v-geithner-et-al

The American Civil Liberties Union was founded in 1920 and is our nation's guardian of liberty. The ACLU works in the courts, legislatures and communities to defend and preserve the individual rights and liberties guaranteed to all people in this country by the Constitution and laws of the United States.

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