Operation Meltdown: “Hidden” Property, Seized for Cause, Is Still Property

June 11, 2019   Robert Gmeiner

  • Property, Markets & Trade
  • Blog

On June 6, 2019, CNN reported on New York City’s Operation Meltdown, which involved seizing forty-six ice cream trucks involved in a ring to avoid paying traffic and parking tickets. New York authorities allege that scheme undertaken by this ring was to operate numerous shell companies and, when an ice cream truck operator received some citations, re-register the truck with the DMV to show it was owned by another shell company. Then, when the authorities tried to collect the unpaid fines, there was no trace of the truck’s owner. The ice cream truck operators involved had apparently received many citations for running red lights, blocking crosswalks, and parking in front of fire hydrants, among other offenses.

These traffic and parking offenses should be punished. Seizing property seems like an extreme way to do it, but when owners (legal, not natural persons) “disappear” as they “hide” their property, alternatives are lacking. Property is property and seizing property, even for just cause, needs to be approached very carefully in any society that desires to respect it. In order for this seizure not to be an infringement of property rights, several conditions must be met.

First of all, it must be possible to challenge the seizure in court, which requires the owner to come forward. Seizing these trucks should not be a summary matter without recourse. Beyond that, major questions of property rights center on whether the loss of the trucks is punitive for having dodged the fines or if they are being seized only to satisfy a debt. If the former, then there is little respect of property rights. If the latter, then the owners should receive the value of the trucks less the amount of the unpaid fines after the trucks are sold, if there is any value left. Lastly, if this is just a matter of paying unpaid citations, if the guilty parties choose to pay the fines, then the trucks should be returned.

Not paying legitimate fines is cause for some punishment. It may be that property needs to be seized to pay them. This should only be done in accordance with established law and with appropriate protections for property owners.