The Internal Revenue Service seized hundreds of millions of dollars from thousands of bank accounts over the past decade, often without proof of any criminal wrongdoing, according to a report released by the Institute for Justice this week.

The Institute for Justice, a public-interest law firm, said the IRS practiced a "seize first, ask questions later" strategy when it seized $242 million in more than 2,500 cases from 2005 to 2012.

All of those seizures were for "structuring" violations, an obscure rule intended to keep money launderers, terrorists, and other criminals from making small deposits to evade federal bank reporting laws. But the Institute for Justice and other civil liberties advocates say the IRS has used the rule to target the bank accounts of law-abiding citizens with no other evidence of a crime.

"The IRS’s forfeiture activity exposes the rotten core of federal civil forfeiture law," Institute for Justice attorney Scott Bullock said in a statement. "Allowing law enforcement to take property from people without convicting them of a crime and then profit from the seizure will inevitably lead to abuse."

In October, the New York Times highlighted the case of Carol Hinders, an Iowa woman runs a small, cash-only Mexican restaurant.

Two IRS agents showed up at Hinder’s door last year and informed her that the agency was seizing $33,000 from her bank account for structuring violations, a law she wasn’t even aware of. She was never accused of a crime.

Facing backlash after the front-page New York Times story, federal prosecutors quietly dropped their case against Hinders in December.

According to the Institute for Justice, at least a third of the IRS’ asset forfeiture cases between 2005 and 2012 were, like Hinders’, based solely a series of cash transactions under $10,000, with no other criminal activity alleged.

Four out of five of those cases were civil, not criminal, meaning the IRS had to meet a lower standard of evidence to secure a seizure.

Even then, nearly half of the money seized was not ultimately forfeited. But it took a year of legal wrangling on average for owners to win their money back. Taken altogether, property owners face a system heavily weighted against them at every step.

The IRS did not immediately return a request for comment. However, in a statement to the Washington Post, the agency said it will no longer indiscriminately target bank accounts.

"We recognize that small businesses and other taxpayers often make deposits under $10,000 without any intent to avoid the reporting requirements," the statement said. "After conducting a review of structuring cases, the IRS concluded that it will focus its limited resources on cases where evidence indicates that the structured funds are derived from illegal sources."

The Justice Department and IRS have both announced they would curb their asset forfeiture practices following a year of critical news reports on cases that swept up regular citizens.

Attorney General Eric Holder announced earlier in January that the Department of Justice would curb its equitable sharing program that funnels proceeds from forfeitures to state and local police departments across the country.

Meanwhile in Congress, Sen. Sen. Rand Paul (R., Ky.) and Rep. Tim Walberg (R., Mich.) reintroduced the FAIR Act in the Senate and House. The bill would strengthen protections for property seized under asset forfeiture programs.

The issue also cropped up last week in a congressional hearing for Loretta Lynch, President Obama’s nominee for attorney general. Lynch, a federal prosecutor, testified that asset forfeiture was a "wonderful tool."