HB2324

THE CONTEXT: Except as provided in statute, all property, including all interests in such property, described in a statute providing for its forfeiture is subject to forfeiture if: 1) the owner is convicted of an offense to which forfeiture applies; and 2) the state establishes by clear and convincing evidence that the property is subject to forfeiture. After a person is convicted of an offense for which forfeiture applies, a court may order the person to forfeit: 1) property the person acquired through the commission of the offense; 2) property that is directly traceable to property acquired through the commission of the...

WHAT THE BILL DID: The final vetoed version would authorize a court to order a person who is convicted of an offense for which forfeiture applies to forfeit: a) any digital asset that is owned by the convicted person and that the person used in or acquired through the person's commission of the office; or b) a digital asset owned by the person that is directly traceable to the convicted person's commission of the offense, require a digital asset that is lawfully seized for forfeiture be secured by: a) gaining access to a private key, passphrase or other access mechanism; b) securing a digital wallet through blockchain technology; or c) transferring the digital asset to a state-approved, secure digital wallet or platform, and authorize the entity that receives forfeited property by the state to sell a forfeited digital asset by public or otherwise commercially reasonable sale with expenses of keeping and selling the digital asset and the amount of all valid interests established by claimants, including court order restitution, paid out of the proceeds of the sale.

WHY IT MATTERED: The practical reason for this bill was to give Arizonans and public officials a defined option for forfeiture under state law. It would authorize a court to order a person who is convicted of an offense for which forfeiture applies to forfeit: a) any digital asset that is owned by the convicted person and that the person used in or acquired through the person's commission of the office; or b) a digital asset owned by the person that is directly traceable to the convicted person's commission of the offense, and would also require a digital asset that is lawfully seized for forfeiture be secured by: a) gaining access to a private key, passphrase or other access mechanism; b) securing a digital wallet through blockchain technology; or c) transferring the digital asset to a state-approved, secure digital wallet or platform, rather than leave the current rule unchanged.