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13 years later, man’s war with U.S. over ‘shoebox’ cash rages on

Nicholas Marrocco in June 2015. | WLKY-TV

Nicholas Marrocco says he kept hundreds of thousands of dollars in a shoebox, in his clothing and even in a bowl in his home in west suburban Wood Dale.

He says he’d messed up his credit in college and couldn’t get a bank account, so he squirreled away the money he’d earned at a pizza joint.

But Marrocco says he lost his life savings on Dec. 6, 2002, when federal drug agents at Union Station in Chicago seized more than $101,000 from a friend he entrusted with the money in their hunt for a restaurant venture on the West Coast.

Federal authorities say they suspected Marrocco and the friend were in the narcotics business.

More than 13 years later, Marrocco — who insists he and his pal weren’t drug dealers — is still fighting to get his money back. He points out they weren’t charged with a crime, and no drugs were ever recovered.

Marrocco’s attorney, Stephen Komie, and a federal source both say they believe Marrocco’s case is the longest-running asset forfeiture battle in U.S. District Court in Chicago.

“This was a drugless case,” Komie says. “It’s the problem with this country’s forfeiture laws. Nobody can compete with the government. The bottom line is that innocent people get caught up in the system.”

He said most cases involve far less money than Marrocco’s and those people tend to settle with the government, typically getting back only half of what was taken.

A spokesman for the U.S. attorney in Chicago declined to comment on the matter.

In testimony before Congress, the Justice Department has defended such cases, saying they “enable the government to recover property when criminal prosecution of the possessor of the property may not be appropriate or feasible.”

Last year, the U.S. attorney’s office in Chicago collected more than $19 million in asset forfeitures. The Justice and Treasury departments raked in more than $4.5 billion nationally in 2014.

It goes back to the 1980s, when Congress created the Justice Department’s Asset Forfeiture Fund as a weapon against drug cartel kingpins. Congress allowed police agencies to keep the assets to pay for things like vehicles and overtime. Those forfeitures have greatly expanded in recent years.

Responding to pressure from critics who believe thousands of innocent people lose their money and property to the government in such forfeitures, the Justice Department set new limits last year.

Local and state police were barred from using federal law to seize cash or property without warrants or criminal charges, unless they were working directly with the feds. But that change was recently reversed by the Justice Department.

Marrocco’s topsy-turvy case shows how difficult it can be to navigate the legal terrain governing such forfeitures.

Since 2003, when the government filed a request to seize Marrocco’s money, the federal appeals court in Chicago has overruled two different lower-court decisions in the case.

Then in January, a jury ruled in favor of the government after a trial.

Marrocco, who is 46, is continuing to fight for his money in post-trial motions.

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Marrocco says the seizure of his money was “a horrible setback, to say the least.”

“I had to reinvent myself,” says Marrocco, now a real estate developer who recently was involved in the construction of a Wal-Mart in Kentucky, according to news accounts.

Marrocco’s forfeiture saga began in 2002 at Union Station, where his friend Vincent Fallon bought a one-way ticket on Amtrak’s “Empire Builder” train to Seattle.

A member of a DEA task force flagged the ticket. Federal authorities have found that drug dealers often travel one-way.

Agents interviewed Fallon in his sleeper cabin. An agent asked whether he was carrying weapons, drugs or large amounts of currency, and he allegedly said no.

According to the government, Fallon let the agents search his bags, although he denies that.

The agents asked about his locked leather attaché case and Fallon acknowledged the bag contained about $50,000, according to the agents. Fallon accompanied them to an office, where one of them opened the bag with a knife and found 19 bundles of cash totaling $101,120.

Fallon then told them he was going to Seattle to invest in a glass-blowing business, according to the agents.

Fallon, an unemployed waiter, went ahead with his trip. Meanwhile, the agents contacted a Chicago Police officer who brought over a drug-sniffing dog that alerted on the bag, indicating the presence of narcotics.

In its 2003 court filing to seize the money, the government said there was probable cause to believe the cash was intended to buy drugs.

But Marrocco, in an interview with the Chicago Sun-Times, says he had just gotten out of the pizza business and was “trying to find an arrangement to get back into the restaurant business.”

He says he gave the money to Fallon, and they planned to meet in Seattle to look for a prospective restaurant investment. Fallon bought a one-way ticket “because we didn’t know what our return was going to be,” Marrocco says.

“I thought I was going to make a statement [to the authorities] and get my money back. I was naïve,” Marrocco says.

In 2004, U.S. District Judge Elaine Bucklo ruled that the DEA didn’t have probable cause to search the bag Fallon was carrying.

“The officers overstepped by opening the briefcase without probable cause and without a warrant,” she wrote, later ordering the government to return the money to Marrocco.

In 2009, though, an appeals court overturned Bucklo’s decision, saying the “illegality” of the agent opening the briefcase with a knife had “no effect on the subsequent discovery that the money was tainted by drugs.”

The case was sent back to Bucklo, who then ruled in favor of the government, writing: “the totality of the circumstances in this case leads to only one reasonable conclusion — that the subject funds were substantially connected to a narcotics-related offense.”

Again, the appeals court overruled her, deciding Marrocco’s work in a pizza restaurant and his relatively expense-free lifestyle in the 1990s was evidence that he could have legally obtained the cash.

A trial was then held, and a jury awarded the government the cash on Jan. 29, 2016.

Komie, the lawyer for Marrocco, has filed several post-trial motions to overturn the verdict. One of them points to a recent federal appeals court ruling in a different case involving $271,000 seized by authorities in 2012 in Lake County.

North Chicago police officers had responded to a call of a home invasion and found a gun, a digital scale and a small amount of marijuana in the home. A man who lived there said intruders had tied up him and others in the home, demanded money and drugs, and then left. He said he moved his brother’s safe to a van in case the intruders returned.

A Lake County sheriff’s drug dog alerted on a presence of drugs in the van and the officers got a search warrant, discovering the money in the safe and handwritten notes that included dates and numbers — but no drugs.

Police said the notes constituted a drug ledger. But the brothers who lived in the home said the notes referred to money they sent to Mexico to build a home.

Since then, the brothers, Pedro and Abraham Cruz-Hernandez, have also been fighting in court to get their money back. On March 17, the federal appeals court in Chicago vacated an earlier judgment in favor of the police, saying the government presented “virtually no evidence” the brothers were drug dealers.

As in the Marrocco case, the appeals court also said there was evidence the brothers held legitimate jobs. They had earned more than $680,000 since 2000 and didn’t spend their money lavishly, the appeals court found.

In a recent court filing, Marrocco said the appeals court’s reasoning in favor of the Cruz-Hernandez brothers should also be applied to his case.

Marrocco says the government’s asset forfeiture program needs to be reined in.

“They are saying if the dog alerts on anything, it’s a substantial connection to narcotics,” he says. “These guys could walk around with dogs and seize currency everywhere.”