Civil Asset Forfeiture is when the government through law enforcement seizes private property (such as cash, vehicles, or even real property) that is alleged to have been used in an illegal transaction, often related to controlled substances or gang activity. So, for example, if police find a large quantity of drugs in the back of a person's vehicle they might seize and then auction off the vehicle alleging that it was being used to transport the illegal drugs.
The problem with this process is that it is not part of a criminal proceeding - indeed, criminal charges do not actually even have to be filed to start a forfeiture. This means the burden of proof is not "beyond a reasonable doubt" as it would be in a criminal case. Rather it is simply by a preponderance of the evidence, a much lower burden of proof, that can result in innocent people losing their property based on little more than suspicion.
I recently tried a case where there were no drugs found in the defendant's vehicle. He was not charged with any drug-related crime (simply a speeding offense as I recall, which was what gave rise to the initial stop). While there was vague circumstantial evidence the defendant was involved in the drug trade (police dog alerting to presence of drugs, car registered in another person's name, inconsistent statements by the driver as to destination) there was no hard evidence, only some $17,000 in cash found in the car. The police seized the money and eventually moved to forfeit same as being involved in the distribution of narcotics.
While the case was lost at the trial level, I was successful in getting the decision overturned on appeal and the client was eventually returned his money. Unfortunately between my fees, court costs, and other expenses the client wound up spending nearly 3/4 of the money he sought to be returned. This is a sad fact of the forfeiture process, where a person charged with no criminal act related to controlled substances can nevertheless have his/her property taken by the state regardless.
Reason.com has an excellent video describing some of the abuses of this process, which I have linked below. Civil forfeiture is rife with abuse and most defendants are unable to fight the process due to lack of funds. This is a law which surely needs to be reformed.