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General Assembly Raised Bill No. 6990
January Session, 2025
LCO No. 5018
Referred to Committee on BANKING
Introduced by:
(BA)
AN ACT CONCERNING THE SEIZURE AND FORFEITURE OF DIGITAL
WALLETS AND VIRTUAL CURRENCY.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Subsection (a) of section 54-36a of the general statutes is 1
repealed and the following is substituted in lieu thereof (Effective October 2
1, 2025): 3
(a) As used in this section, sections 53-278c and 54-36c: (1) 4
"Contraband" means any property, the possession of which is 5
prohibited by any provision of the general statutes; (2) ["stolen 6
property" shall include, but not be limited to, cash or the proceeds from 7
the sale of such property obtained by theft or other illegal means; (3)] 8
"digital wallet" means any electronic or digital functionality that (A) 9
stores account or payment credentials for a consumer, including, but not 10
limited to, in encrypted or tokenized form, and (B) transmits, routes or 11
otherwise processes such stored account or payment credentials to 12
facilitate a consumer payment transaction; (3) "owner" means a person 13
or persons entitled to seized property as a matter of law or fact; (4) 14
"property" includes, but is not limited to, digital wallets and virtual 15
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currency; (5) "stolen property" includes, but is not limited to, cash, 16
digital wallets, virtual currency or the proceeds from the sale of such 17
property obtained by theft or other illegal means; and (6) "virtual 18
currency" has the same meaning as provided in section 36a-596. 19
Sec. 2. Section 54-36h of the general statutes is repealed and the 20
following is substituted in lieu thereof (Effective October 1, 2025): 21
(a) As used in this section, (1) "digital wallet" means any electronic or 22
digital functionality that (A) stores account or payment credentials for a 23
consumer, including, but not limited to, in encrypted or tokenized form, 24
and (B) transmits, routes or otherwise processes such stored account or 25
payment credentials to facilitate a consumer payment transaction; (2) 26
"property" includes, but is not limited to, digital wallets and virtual 27
currency; and (3) "virtual currency" has the same meaning as provided 28
in section 36a-596. 29
(b) The following property shall be subject to forfeiture to the state 30
pursuant to subsection [(b)] (c) of this section: 31
(1) All moneys used, or intended for use, in the procurement, 32
manufacture, compounding, processing, delivery or distribution of any 33
controlled substance, as defined in section 21a-240; 34
(2) All property constituting the proceeds obtained, directly or 35
indirectly, from any sale or exchange of any such controlled substance 36
in violation of section 21a-277 or 21a-278; 37
(3) All property derived from the proceeds obtained, directly or 38
indirectly, from any sale or exchange for pecuniary gain of any such 39
controlled substance in violation of section 21a-277 or 21a-278; 40
(4) All property used or intended for use, in any manner or part, to 41
commit or facilitate the commission of a violation for pecuniary gain of 42
section 21a-277 or 21a-278; 43
(5) All property constituting, or derived from, the proceeds obtained, 44
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directly or indirectly, by a corporation as a result of a violation of section 45
53a-276, 53a-277 or 53a-278. 46
[(b)] (c) Not later than ninety days after the seizure of moneys or 47
property subject to forfeiture pursuant to subsection [(a)] (b) of this 48
section, in connection with a lawful criminal arrest or a lawful search 49
that results in an arrest, the Chief State's Attorney or a deputy chief 50
state's attorney, state's attorney or assistant or deputy assistant state's 51
attorney may petition the court in the nature of a proceeding in rem to 52
order forfeiture of said moneys or property. Such proceeding shall be 53
deemed a civil suit in equity, in which the state shall have the burden of 54
proving all material facts by clear and convincing evidence. The court 55
shall identify the owner of said moneys or property and any other 56
person as appears to have an interest therein, and order the state to give 57
notice to such owner and any interested person by certified or registered 58
mail. No testimony offered or evidence produced by such owner or 59
interested person at such hearing and no evidence discovered as a result 60
of or otherwise derived from such testimony or evidence, may be used 61
against such owner or interested person in any proceeding, except that 62
no such owner or interested person shall be immune from prosecution 63
for perjury or contempt committed while giving such testimony or 64
producing such evidence. At such hearing the court shall hear evidence 65
and make findings of fact and enter conclusions of law and shall issue a 66
final order, from which the parties shall have such right of appeal as 67
from a decree in equity. 68
[(c)] (d) The court shall hold a hearing on the petition filed pursuant 69
to subsection [(a)] (b) of this section not more than two weeks after the 70
criminal proceeding that occurred as a result of the arrest has been 71
nolled, dismissed or otherwise disposed of. The court shall deny the 72
petition and return the property to the owner if the criminal proceeding 73
does not result in (1) a plea of guilty or nolo contendere to any offense 74
charged in the same criminal information, (2) a guilty verdict after trial 75
to a forfeiture-eligible offense for which the property was possessed, 76
controlled, designed or intended for use, or which was or had been used 77
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as a means of committing such offense, or which constitutes the 78
proceeds of the commission of such offense, or (3) a dismissal resulting 79
from the completion of a pretrial diversionary program. 80
[(d)] (e) No property shall be forfeited under this section to the extent 81
of the interest of an owner or lienholder by reason of any act or omission 82
committed by another person if such owner or lienholder did not know 83
and could not have reasonably known that such property was being 84
used or was intended to be used in, or was derived from, criminal 85
activity. 86
[(e)] (f) Notwithstanding the provisions of subsection [(a)] (b) of this 87
section, no moneys or property used or intended to be used by the 88
owner thereof to pay legitimate attorney's fees in connection with his 89
defense in a criminal prosecution shall be subject to forfeiture under this 90
section. 91
[(f)] (g) Any property ordered forfeited pursuant to subsection [(b)] 92
(c) of this section shall be sold at public auction conducted by the 93
Commissioner of Administrative Services or his designee. 94
[(g)] (h) The proceeds from any sale of property under subsection [(f)] 95
(g) of this section and any moneys forfeited under this section shall be 96
applied: (1) To payment of the balance due on any lien preserved by the 97
court in the forfeiture proceedings; (2) to payment of any costs incurred 98
for the storage, maintenance, security and forfeiture of such property; 99
and (3) to payment of court costs. The balance, if any, shall be deposited 100
in the drug assets forfeiture revolving account established under section 101
54-36i. 102
Sec. 3. Section 54-36o of the general statutes is repealed and the 103
following is substituted in lieu thereof (Effective October 1, 2025): 104
(a) As used in this section, (1) "digital wallet" means any electronic or 105
digital functionality that (A) stores account or payment credentials for a 106
consumer, including, but not limited to, in encrypted or tokenized form, 107
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and (B) transmits, routes or otherwise processes such stored account or 108
payment credentials to facilitate a consumer payment transaction; (2) 109
"property" includes, but is not limited to, digital wallets and virtual 110
currency; and (3) "virtual currency" has the same meaning as provided 111
in section 36a-596. 112
(b) All property constituting, or derived from, the proceeds obtained, 113
directly or indirectly, by a person as a result of a violation of section 53a-114
129a of the general statutes, revision of 1958, revised to January 1, 2003, 115
or section 53a-127g, 53a-129b, 53a-129c, 53a-129d, 53a-129e, 53a-130, 21-116
120 or 21-121 shall be subject to forfeiture to the state pursuant to 117
subsection [(b)] (c) of this section. 118
[(b)] (c) Not later than ninety days after the seizure of property subject 119
to forfeiture pursuant to subsection [(a)] (b) of this section, in connection 120
with a lawful arrest or a lawful search that results in an arrest, the Chief 121
State's Attorney or a deputy chief state's attorney, state's attorney or 122
assistant or deputy assistant state's attorney may petition the court in 123
the nature of a proceeding in rem to order forfeiture of said moneys or 124
property. Such proceeding shall be deemed a civil suit in equity, in 125
which the state shall have the burden of proving all material facts by 126
clear and convincing evidence. The court shall identify the owner of 127
such property and any other person as appears to have an interest 128
therein, and order the state to give notice to such owner and any 129
interested person by certified or registered mail. No testimony offered 130
or evidence produced by such owner or interested person at such 131
hearing and no evidence discovered as a result of or otherwise derived 132
from such testimony or evidence, may be used against such owner or 133
interested person in any proceeding, except that no such owner or 134
interested person shall be immune from prosecution for perjury or 135
contempt committed while giving such testimony or producing such 136
evidence. At such hearing the court shall hear evidence and make 137
findings of fact and enter conclusions of law and shall issue a final order, 138
from which the parties shall have such right of appeal as from a decree 139
in equity. 140
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[(c)] (d) The court shall hold a hearing on the petition filed pursuant 141
to subsection [(a)] (b) of this section not more than two weeks after the 142
criminal proceeding that occurred as a result of the arrest has been 143
nolled, dismissed or otherwise disposed of. The court shall deny the 144
petition and return the property to the owner if the criminal proceeding 145
does not result in (1) a plea of guilty or nolo contendere to any offense 146
charged in the same criminal information, (2) a guilty verdict after trial 147
to a forfeiture-eligible offense for which the property was possessed, 148
controlled, designed or intended for use, or which was or had been used 149
as a means of committing such offense, or which constitutes the 150
proceeds of the commission of such offense, or (3) a dismissal resulting 151
from the completion of a pretrial diversionary program. 152
[(d)] (e) No property shall be forfeited under this section to the extent 153
of the interest of an owner or lienholder by reason of any act or omission 154
committed by another person if such owner or lienholder did not know 155
and could not have reasonably known that such property was being 156
used or was intended to be used in, or was derived from, criminal 157
activity. 158
[(e)] (f) Notwithstanding the provisions of subsection [(a)] (b) of this 159
section, no property used or intended to be used by the owner thereof 160
to pay legitimate attorney's fees in connection with his defense in a 161
criminal prosecution shall be subject to forfeiture under this section. 162
[(f)] (g) Any property ordered forfeited pursuant to subsection [(b)] 163
(c) of this section shall be sold at public auction conducted by the 164
Commissioner of Administrative Services. 165
[(g)] (h) The proceeds from any sale of property under subsection [(f)] 166
(g) of this section shall be applied: (1) To payment of the balance due on 167
any lien preserved by the court in the forfeiture proceedings; (2) to 168
payment of any costs incurred for the storage, maintenance, security 169
and forfeiture of such property; and (3) to payment of court costs. The 170
balance, if any, shall be deposited in the privacy protection guaranty 171
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and enforcement account established under section 42-472a. 172
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2025 54-36a(a)
Sec. 2 October 1, 2025 54-36h
Sec. 3 October 1, 2025 54-36o
Statement of Purpose:
To specify that digital wallets and virtual currency are included in the
term "property" as such term is used in various statutes concerning the
seizure and forfeiture of property.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]