Jon Davenport of the The Virginian-Pilot has compiled a database of asset forfeiture revenues in Virginia, available here.
First, a word of congratulations is in order to Lee McGrath at the Institute for Justice, who has spearheaded the effort to reform asset forfeiture in Minnesota. As Bob Adelmann reports in the New American:
On August 1, citizens in Minnesota will rejoice that the police can no longer steal their property without their being convicted — or even charged with — a crime. Until then, Minnesota remains an upside-down world, as do many other states, where police can seize cash and property if they think that somehow that cash or property was involved in a crime. Until August 1, citizens who have had their property seized will still have to prove a negative: that their property was neither the “instrument” nor the “proceeds” of the charged crime.
Lee McGrath, executive director of Minnesota’s chapter of the Institute for Justice (IJ), which was instrumental in successfully pushing for passage of the bill, noted:
"No one acquitted in criminal court should lose his property in civil court. This change makes Minnesota’s law consistent with the great American presumption that a person and his property are innocent until proven guilty."
And indeed, the reforms that are now Minnesota law represent one of the most important current efforts to articulate and deploy fundamental protections for American property rights and liberty. Yet, even this important step did not come without reaching a compromise with the particular special interests groups invested in the revenue stream represented by expansive civil forfeiture laws. As Nicole Sims of think tank Minnesota 2020 notes:
In devising the final bill, its proponents made a compromise with Minnesota County Attorneys Association (MCAA) to allow civil forfeiture with the equivalent of a conviction in drug-related cases. Equivalents to conviction include an admission of guilt on behalf of the property owner, receiving a diversion or stay of a criminal sentence, or making a plea bargain that involves serving as an informant. Supporters also compromised on a provision that would have directed the proceeds from civil forfeiture toward the state’s general fund instead of law enforcement agencies.
While Feist acknowledges “the new conviction requirement is an important reform,” he notes that the ACLU plans to continue its work on civil asset forfeiture in the 2015 session. This includes pursuing a bill that would empower innocent owners to make claims on property when someone else’s activities result in its seizure. A bill to that effect was unsuccessful during this legislative session.
It will be instructive to see if changes to the law (which take effect on August 1st) result in fewer arrests, given allegations that civil forfeiture encourages policing for profit.
Reformers should take note here. The success of further forfeiture reform efforts in Minnesota and elsewhere hinge on drastically taming the aggressive nature of law enforcement lobbies, and in particular prosecutor's associations. Prosecutors hold a unique place in the asset forfeiture system: they are the agents responsible for processing and sanitizing the use of asset forfeiture as a revenue stream for their own departments and the other corporate entities of law enforcement.
Part of the issue is simply combatting the enormous practical political power that prosecutors hold within society and political systems as a result of their status and centrality to the judicial system. Reformers would do well to focus here on two objectives.
First, do the legwork to impeach and discredit the arguments mustered by prosecutors and law enforcement lobbies in favor of civil forfeiture; this may require extensive research not only into the revenue system of asset forfeiture, but also into the broader spectrum of law enforcers and prosecutors as they act under these incentive structures. Where public officials have financial incentives to limit the rights and liberties of the people they serve, abuses are inevitable and frequent.
Second, find allies within the field of law enforcement. These institutions are not monolithic, and there are people of integrity who attain the ranks of judges, prosecutors, and police. Indeed, finding and empowering the dissidents within law enforcement is perhaps the most valuable thing that any reformer could do. The best example of this is perhaps the organization Law Enforcement Against Prohibition, a group that has been of immense value to marijuana and drug policy reformers in multiple campaigns around the country.
Legislatures, indeed, are listening. In the last few years there have been reform efforts emerge in states like Tennessee, Minnesota, Utah, Georgia, California, and Texas (there are of course others, but this is a brief list par example). Yet few of these efforts have been successful in their initial stages, and while there is traction for further attempts, systemic reform is unlikely to happen without serious thought given to those opposing forfeiture reform.
In a November 13, 2013, federal public defender Steve Kalar noted:
The NSA obtained cell-site location data, without probable cause, in twenty criminal cases in the massive C.D. Cal. By contrast, it appears to have tracked 40 criminalcases without P.C. in the much-smaller ND Cal! (IncludingUnited States v. Raymon Hill, a routine S.F. gang case).
Who in the ND Cal was so infatuated with cell-site location data, and how did they dodge P.C. requirements in so many cases?
We, of course, are interested in the use of this data in developing federal asset forfeiture investigations. Since federal civil forfeiture can be initiated independent of any criminal investigation, it is an attractive vehicle for deploying intelligence analysis based on NSA collection, and would of course allow US attorneys to virtually guarantee that their offices made a healthy profit from their enforcement actions.
The Civil Forfeiture Implications of Using NSA Intercepts to Prosecute Violations of the Foreign Corrupt Practices Act
This was originally posted August 6, 2013 and is reproduced in its entirety.
Yesterday, the National Association of Criminal Defense Lawyers slammed the expanding use of NSA intelligence by domestic law enforcement agencies, particularly noting the use of this intelligence to prosecute violations of the Foreign Corrupt Practices Act:
Washington, DC (August 5, 2013) – Today, Reuters news service reported that “A secretive U.S. Drug Enforcement Administration unit is funneling information from intelligence intercepts, wiretaps, informants and a massive database of telephone records to authorities across the nation to help them launch criminal investigations of Americans.” Reuters further reports that it has undated documents that “show that federal agents are trained to ‘recreate’ the investigative trail to effectively cover up where the information originated, a practice that some experts say violates a defendant’s Constitutional right to a fair trial. If defendants don’t know how an investigation began, they cannot know to ask to review potential sources of exculpatory evidence – information that could reveal entrapment, mistakes or biased witnesses.” And late yesterday, The Houston Chronicle reported that “The National Security Agency is handing the Justice Department information, derived from its secret electronic eavesdropping programs, about suspected criminal activity unrelated to terrorism[,]” including in cases alleging conduct including sex offenses and corporate criminal activity under the Foreign Corrupt Practices Act. The information sharing programs reported by Reuters and The Houston Chronicle over the last 24 hours are yet further examples of the national security state seeping into the traditional justice system.
National Association of Criminal Defense Lawyers (NACDL) President Jerry J. Cox said: “NACDL has long feared that overbroad national security policies would become the norm for all criminal prosecutions and today we know our concerns were not unfounded. Two months after Edward Snowden’s initial disclosures about various U.S. government surveillance activities, we know very little more about the parameters of the NSA surveillance programs. These latest reports are particularly troubling for accused persons who cannot vindicate fundamental constitutional rights without access to accurate and complete information. This puts liberty at risk of being lost without due process of law, which is an affront to the Constitution.”
Indeed, there are further, significant Constitutional implications to these reports. In the American criminal justice system, prosecutors are required to disclose all information in the government’s possession that is favorable to the accused, pertaining to either the determination of guilt or imposition of sentencing. These reports suggest that prosecuting government agencies are provided data collected via seemingly limitless NSA surveillance programs that the American people have been repeatedly told have stringent safeguards and exist only for the purpose of gathering information about international terrorists. Additionally, the Reuters report indicates that programs of intentional non-disclosure of the actual sources of information in connection with non-terror-related activity may be in place. Yet, those accused of criminal activity have no access to any exculpatory information collected by these NSA programs. (Ivan J. Dominguez, Nation’s Criminal Defense Bar Alarmed by Reports of NSA Surveillance Data Use and Intentional, Systematic Non-Disclosure in Domestic, Non-Terror-Related Criminal Cases, NACDL Press Release, 5 Aug. 2013)
The implications of using the NSA intercepts to leverage enforcement of the Foreign Corrupt Practices Act are enormous given the history of the law:
Yet paying foreign officials to secure contracts abroad was simply a part of doing business in the 1970s. Hundreds of U.S. companies paid bribes out of perceived necessity. Counting on its influence as the most world’s powerful economic force, the United States decided to eliminate the practice and passed the Foreign Corrupt Practices Act (FCPA) of 1977. The FCPA outlawed bribery and imposed financial accounting requirements on all U.S. persons and certain foreign issuers of securities. Thirty-five years later, FCPA enforcement is contentious. Corruption is an extraordinarily fact-specific crime, so the government can’t foresee and enumerate all of the activities that are prohibited. At the same time, businesses require clear lines and definitions to comply with the Act.
The U.S. Department of Justice (DOJ) and U.S. Securities and Exchange Commission (SEC) rarely enforced the law until about a decade ago. Since then, the government has accelerated enforcement, broadened its reading of the Act, tried new prosecutorial strategies, and even experimented with sting operations. Today, the SEC and DOJ investigate between 70 and 80 potential FCPA violations at any given time—this is more than at any other time in the Act’s history. Since 2009, the DOJ has entered into more than 40 corporate resolutions of FCPA investigations, resulting in nine of the top 10 monetary settlements in FCPA history, including more than $2 billion in fines recovered. In 2012 alone, the government collected $260,571,467 in financial penalties from corporations violating the FCPA. (Institute for National Security and Counterterrorism, The FCPA Landscape, Spring 2013)
The intentional non-disclosure of NSA intercepts used to start investigations into FPCA violations implies that the Department of Justice has managed to leverage illegal surveillance practices into a massively profitable extortion system that denies corporate and individual targets access to fundamental rights. Moreover, US companies doing business abroad are presented with a host of liability risks from conducting what might be otherwise ordinary, routine business practices:
To enforce the FCPA’s anti-bribery provisions, the federal government is authorized to pursue forfeiture – administratively, civilly or criminally – of the proceeds traceable to criminal violations of the FCPA. “Proceeds” includes any property, real or personal, tangible or intangible, that the wrongdoer would not have obtained or retained but for the crime. For example, a company’s profits from its contract with a foreign government agency, allegedly obtained as a result of corruptly “wining and dining” the contract procurement official or by virtue of the company having given a lucrative job to that official’s spouse, could be subject to forfeiture. (Reichwald et al, DOJ’s Escalating Use of the Foreign Corrupt Practices Act To Seize Customer Bank Accounts, Manett, Phelps and Phillip, LLP, 12 July 2012).
The DOJ’s more aggressive enforcement has included focusing on individuals, not just companies. Indeed, US Attorney General Eric Holder has said that “prosecuting individuals is a cornerstone of [the DOJ’s] enforcement strategy.” This statement, made in spring 2010, came shortly after a person was sentenced to over seven years in prison upon pleading guilty to, among other things, conspiring to violate the FCPA.
With the DOJ’s focus on individual accountability, corporate executives are now at risk for business procedures that, until recently, they might have considered routine rubberstamping, such as securing government permits, processing customs papers, and procuring sales licenses.
“The same holds true of various routine interactions with business associates,” says Shah. “Take, for instance, a US medical-device company’s sales manager who sponsors the attendance of an industry conference by a healthcare provider in China. If the healthcare provider is employed by a state-owned hospital, he or she could be considered a government official, consequently increasing the potential risk of FCPA violation.” (PriceWaterCoopers, Foreign Corrupt Practices Act, Growing Your Business, 2011)
It’s time for Congress to review the Department of Justice’s practices regarding both the secret sharing of NSA intelligence with the DOJ and the use of civil forfeiture to enforce the FPCA. At the very least, the DOJ should not be able to use civil forfeiture as an enforcement tool; the revenue created for the DOJ through FPCA civil forfeiture represents a structural incentive for the federal government to violate the rights of companies and individuals engaged in international trade for profit.
Note: A version of this post was originally published August 5, 2013.
The revelations that the DEA has a secret Special Operations Division (SOD) that uses NSA and CIA intelligence to spy on Americans suspected of drug crimes should be in taken in context of the DEA’s use of federal civil forfeiture to profit from drug prohibition. Reuters reports:
A secretive U.S. Drug Enforcement Administration unit is funneling information from intelligence intercepts, wiretaps, informants and a massive database of telephone records to authorities across the nation to help them launch criminal investigations of Americans.
Although these cases rarely involve national security issues, documents reviewed by Reuters show that law enforcement agents have been directed to conceal how such investigations truly begin – not only from defense lawyers but also sometimes from prosecutors and judges.
The undated documents show that federal agents are trained to “recreate” the investigative trail to effectively cover up where the information originated, a practice that some experts say violates a defendant’s Constitutional right to a fair trial. If defendants don’t know how an investigation began, they cannot know to ask to review potential sources of exculpatory evidence – information that could reveal entrapment, mistakes or biased witnesses. (John Shiffman and Kristina Cooke, U.S. directs agents to cover up program used to investigate Americans, Reuters, 5 Aug. 2013)
AFR Research Director Scott Meiner notes that:
“While the techniques described are universally bad, they carry special concern in forfeiture cases–where intelligence tips of a driver carrying cash (for legitimate or illegitimate reasons) compels officers to create parallel constructions to obfuscate from the courts and the public the real reasons why drivers are pulled over: so the department can score forfeiture proceeds.”, said AFR Research Director Scott Meiner. “Informed police departments can use SOD tips to pull over cars that they know have cash (whether it is legitimate or illegitimate) and then apply a K9 sniff (with seeming random innocuity) and find the cash that they knew existed. A positive sniff (which is an inevitably positive sniff given what we know of cuing errors) validates the purported connection to drugs and thus justifies the forfeiture to the courts.”
This is particularly problematic in civil asset forfeiture, as federal law allows the seizure and forfeiture of property in a civil, not criminal process, and there is no federal requirement that criminal charges be filed when the government is interested in a civil forfeiture.
More broadly, the use of SOD to spy on Americans by the DEA calls into question not just the use of asset forfeiture in highway stops, but also in other aggressive forfeiture-related tactics such as the use of confidential informants and forfeiture “specialists” who hunt for property to seize. Two recent cases are instructive in this regard:
- The 2008 “reactivation” of DEA informant Anthony Chambers, who was caught lying under oath in court at least 16 times and was fired by the agency in 2000. Chambers is known as the “highest-paid snitch” in DEA history and is responsible for over 445 drug arrests, as well as millions of dollars seized by the DEA and other agencies.
- The attempted forfeiture of Russ Caswell’s motel property in Tewksbury, MA. The DEA attempted to seize the Motel Caswell after Vincent T. Kelly, a DEA forfeiture specialist, claimed he had found reports of drug crimes happening at the Motel Caswell in newspapers going back over a decade. It seems more than a little odd that DEA forfeiture specialists read decades-old newspaper articles looking for property to seize; is it possible that this justification for the Motel Caswell forfeiture is a “parallel construction”?
Indeed, asset forfeiture is now a major revenue stream for federal law enforcement. Sarah Stillman reports in the New Yorker:
Forfeiture in its modern form began with federal statutes enacted in the nineteen-seventies and aimed not at waitresses and janitors but at organized-crime bosses and drug lords. Law-enforcement officers were empowered to seize money and goods tied to the production of illegal drugs. Later amendments allowed the seizure of anything thought to have been purchased with tainted funds, whether or not it was connected to the commission of a crime. Even then, forfeiture remained an infrequent resort until 1984, when Congress passed the Comprehensive Crime Control Act. It established a special fund that turned over proceeds from forfeitures to the law-enforcement agencies responsible for them. Local police who provided federal assistance were rewarded with a large percentage of the proceeds, through a program called Equitable Sharing. Soon states were crafting their own forfeiture laws.
Revenue gains were staggering. At the Justice Department, proceeds from forfeiture soared from twenty-seven million dollars in 1985 to five hundred and fifty-six million in 1993. (Last year, the department took in nearly $4.2 billion in forfeitures, a record.) The strategy helped reconcile President Reagan’s call for government action in fighting crime with his call to reduce public spending. In 1989, Attorney General Richard Thornburgh boasted, “It’s now possible for a drug dealer to serve time in a forfeiture-financed prison after being arrested by agents driving a forfeiture-provided automobile while working in a forfeiture-funded sting operation.” (Sarah Stillman, “Taken“, The New Yorker, 12 Aug. 2013)
Ethan Nadelmann, executive director of the Drug Policy Alliance, called for Congress to act, saying “It’s remarkable how little scrutiny the DEA faces from Congress or other federal overseers. With an annual budget of over $2 billion as well as significant discretionary powers, DEA certainly merits a top-to-bottom review of its operations, expenditures and discretionary actions.” We might add that it’s time for Congress to specifically review the DEA’s discretionary asset forfeiture authority and access to unappropriated forfeiture revenues. Prior to 1984, the US was able to fund its federal and state law enforcement through direct legislative appropriations. It’s time for Congress to reassert its power of the purse and end the ability of federal law enforcement to chase profits without accountability.
Waco News Channel 25 (KXXV) reports:
The McLennan County district attorney's office has reached a big milestone.
They've collected over $1 million worth of forfeited assets in less than four years under DA Abel Reyna.
Reyna released the numbers exclusively to News Channel 25 on Tuesday.
He says the contraband collected is from criminal activity like drug sales, gambling and money laundering.
Reyna says, "Asset forfeiture is essentially attacking the fruit of criminal behavior. It's one thing to go after conduct, it's another to go after the property that's a result of that conduct. And you have to be firm on both ends to combat and fight crime."The forfeited assets are either auctioned off, sold or destroyed.
Reyna says the proceeds are distributed between law enforcement, DA and clerk's offices.
The history of how the states adopted civil asset forfeiture is an obscure and under appreciated part of the War on Drugs (emphasis mine):
Four years ago, the U.S. Congress amended the federal Uniform Controlled Substances Act to permit the civil forfeiture of property of virtually any kind, including money, when the property could be directly linked to illegal drug transactions. As a result of that amendment, federal agents in fiscal year 1980-1981 were responsible for the forfeiture of over five million dollars in assets from Michigan drug busts in which local law enforcement agencies often played a major role. These assets benefitted the federal treasury, but had Michigan's laws contained similar forfeiture provisions those funds could have been retained by state and local law enforcement agencies for use in the state in the fight against drug trafficking. However, state officials have no authority under current state law to forfeit assets related to drug violations using the civil law's lower standard of proof. The federal Drug Enforcement Administration has made available a model law for states to use in making their laws parallel to the federal act.... [T]he legislature ought to act to adopt some form of that model law so that law enforcement agencies and substance abuse programs in the state could make use of forfeited assets that otherwise would go to the federal government. [Michigan State House Legislative Analysis, SB 645, September 21, 1982.]
The Office of the U.S. Attorney for the Southern District of New York recently agreed to return $38,000 of the $40,000 that federal agents seized from an Amtrak passenger, Mr. Ibrahim Emmam. Mr. Emmam agreed, among other things, to not contest the forfeiture of $2,000 of his money, to concede pursuit of an award of attorney fees for substantially prevailing in a federal asset forfeiture case, and to 'hold harmless' the U.S. Government and its agents for their role in the seizure and attempted forfeiture of the remainder of his cash.
For Mr. Emmam, who faced losing everything, settling, for those terms, presumably made sense. The settlement was surely better for Mr. Emmam than what happens to most people who have their things seized by law enforcement. Most people, of course, simply lose everything seized. For the few who fight the attempted forfeiture, they face losing everything and face (often cost-prohibitive) legal expenses and possible danger of incriminating themselves.
Still, one might wonder about the ethics of the agreement for the U.S. Government and its agents.
Our government, through its agents, took Mr. Emmam's money. It then moved to forfeit the entirety of his cash on the theory that Mr. Emmam's cash was 'guilty' of somehow being involved with the illicit drug trade. If accurate, according to federal law, that meant that Mr. Emmam's legal interest in all of the seized money divested once the money was used or derived from drug trafficking. That is, all of his money was 'guilty' and, again according to federal law, contraband that became the property of the U.S. Government. Forfeiting $2,000 of the $40,000, without stipulating that $2,000 of the money was guilty and the other $38,000 was not, then, seems to ungird its stated rationale for forfeiture.
Accepting the principles of asset forfeiture that the prosecutors used to move for forfeiture, for the sake of the discussion, absent a contrary stipulation, the U.S. Government either had zero right to the money (if it wasn't 'guilty') or had full right to all of the money (because it was 'guilty'). And if it had no right to the money, then conditioning the return of the $38,000 on conceding the $2,000 sounds more like extortion than the activities of a legitimate government. One imagines, at least, that prosecutors would be interested in private parties that made a habit of taking individuals' cash and offering to return 95% of the money on the conditions that the affected parties gave up 5% and agreed to not pursue legal remedies to reclaim the remainder.
On the other hand, again accepting such principles of asset forfeiture for the sake of the discussion, why are prosecutors returning 95% of the money to Mr. Emmam if they sincerely believe that the money is 'guilty' and that asset forfeiture is justified? Simply charging individuals small sums of cash for raising the suspicions of law enforcement or prosecutors, on threat of confiscating larger sums of cash, isn't an ethically tenable position.
Furthermore, ethical issues are raised by conditioning the return of one's confiscated money on agreements to waive rights to seek awards of legal expenses and to 'hold harmless' the government and its agents for seizing one's money and attempting to forfeit it. Congress passed the "Civil Asset Forfeiture Reform Act of 2000 'to make federal civil forfeiture procedures fair to property owners and to give owners innocent of any wrongdoing the means to recover their property and make themselves whole after wrongful government seizures.'" United States v. One Lincoln Navigator, 328 F.3d 1011, 1012 (8th Cir. 2003), Quoting from H.R.Rep. No. 106-192, at 11 (1999);see Pub.L. No. 106-185, § 2, 114 Stat. 202.
Permitting prosecutors to threaten to take large sums of money, for small sums of money, while indemnifying themselves, is against the spirit of the reforms Congress passed. Moreover, what little accountability that the U.S. forfeiture regime allows for is provided by making the government and its agents liable for their overreaches.
Kevin Glaser, a retired narcotics officer who currently serves as current vice president of the Missouri Narcotics Officers Association, has a very important quote in an article in today's St. Louis Riverfront Times that really deserves a lot more attention. To wit (emphasis mine):
"If we seize $50,000 from a drug seizure and it is drug proceeds, it's forfeited through the state of Missouri to the school fund to fund our schools. That sounds good. They have $50,000 to play with now. In actuality, though, what happens is our state legislators, when they're divvying out the money to the schools, and they see that $50,000 go into the school fund from asset forfeiture, they take out $50,000 they were gonna contribute to the school fund. The school fund does not make an additional $50,000 off of that. That's the way asset forfeiture has been since it came into effect.
What law enforcement has done is, seeing that there's really no good coming to Missouri from asset forfeiture because other than funding general revenue - that's all it really does - we utilize federal forfeiture, which allows us to take that $50,000 seized from the drug proceeds and then we can, applied through a court system that has several checks and balances to make sure it was a very factual and legitimate seizure, then that $50,000 -- and actually it's only 80 percent of that because the federal government gets 20 percent right off the bat -- but 80 percent of that $50,000 can come back and be used by local law enforcement for very specific -- buying equipment, buying cars, -- there are very specific requirement, you just can't go out and spend it randomly on whatever you want. It can be utilized by the police department to further enhance the department and drug investigations and criminal investigations.
In other words, Kevin Glaser has a problem with the idea that the Missouri Legislature might do their duty and *gasp* appropriate funds to public uses that aren't law enforcement. Indeed, under federal asset forfeiture, Missouri law enforcement does not *really* need the consent of the legislature to receive or spend public dollars...which is really the point of having a legislature in the first place.
Addendum: Carl Bearden, who served as the Speaker pro tem of the Missouri House of Representatives from 2005 to 2007, says of Glaser's statement:
His statement is a bunch of bovine fecal matter. It is an example of attempting to show the ends justify the means. His statement of redirecting money is false. He simply plays on a common perception of what happens. In the end, It is much better to have people we elect to make those decisions that the non-elected, unaccountable people like Glaser make them "on our behalf".
Responding to a tip from the DEA, the Iowa City Police Department (ICPD) stops family’s car with a K-9 unit. K-9 (of course) alerts to vehicle. Officers don’t find any drugs. Officers, however, find family has $48,000 in cash. Officers take the money. Family claims money was intended to buy property from relatives. Family claims that the sale didn’t go through. Family says they were driving home with the money when ICPD pulled their vehicle over. Family demands the return of their money. ICPD says they gave the money to federal authorities. Family sues in Iowa court for return of the money. County Attorney argues local courts lack jurisdiction over the matter because the money was given to federal authorities. ICPD and County Attorney claim federal authorities thinking about forfeiting the money. Called to provide witnesses on the seizure and transfer, ICPD sends (apparently) uninformed sergeant as witness. Sergeant speculates on the case:
“Iowa City Sgt. David Droll, who took the stand as a state witness during the hearing, said that although he did not conduct the initial traffic stop, it was his understanding that a DEA official contacted the Iowa City Police Department on March 16 and informed them that the vehicle being driven by Overton was to be stopped as part of an ongoing narcotics investigation.
“My take on this was that it came from the DEA. They made the phone call to one of our officers that got the ball rolling,” Droll said. “I believe there is an ongoing drug investigation, but it’s not being done by the Iowa City Police Department.”
Little additional information was made available during the hearing about the DEA investigation and none of the three Iowa City officers who conducted the traffic stop or searched the vehicle attended the hearing.” Mitchell Schmidt, Sides Debate Legality of Police Seizing Couple’s $48K, Iowa City Press-Citizen, May 13, 2014.
Thus far, neither federal or local authorities have raised charges against the money or the family. The family is, however, without its money. Further, the family faces fighting two costly legal battles, in federal and local courts.
Mitchell Schmidt, reporting for the Iowa City Press-Citizen, quotes the presiding district court judge as saying that he is profoundly troubled by the situation.
As for the ICPD, they stand to receive up to 80% of the proceeds of the seizure if the money is ultimately forfeited by federal authorities. Insidiously, under federal guidelines, the ICPD is free to spend the windfall on overtime salaries for the very officers who seized the cash on a DEA tip.
A 2012 financial report by the firm of Bucher, Essner and Miles and delivered to the office of Missouri Auditor Tom Schweich found that the Southeast Missouri Drug Task Force was seriously dependent on forfeiture proceeds:
“The Task Force is reliant on funding from local governmental units participating in the agency in conjunction with federal grant monies applied for each year. In addition, the Task Force is entitled by current federal regulations to receive a portion of any money seized or proceeds from the sale of property seized by it during the course of an investigation or arrest. Changes in the laws concerning cooperative sharing of seized property, availability of federal funds or the economy in the area surrounding the governmental units could have an adverse effect on the task force.
"restricted balance of $923,944.40 represents unexpended federal forfeitures that are limited to the following permissible uses; activities to enhance future investigations, law enforcement training, law enforcement equipment and operations, detention facilities, law enforcement facilities and equipment, drug education and awareness programs, pro rata funding and asset accounting and tracking."
Many thanks to Aaron Malin, who received this audit report through a Sunshine Law request and is working with AFR and the American Victory Coalition to further research the modalities of drug law enforcement in Missouri, particularly with respect to asset forfeiture and marijuana law reform.
This post comes to us from our Michigan colleague Michael Komorn, and was originally posted at the Komorn Law blog.
Perhaps the most painful and profitable aspect of many police raids is the civil forfeiture process. Unlike criminal forfeiture, in civil forfeiture people do not need to be convicted or even charged with a crime to lose their cash, cars and property. Patients and caregivers in Michigan are all too familiar with this abusive police practice. My clients have had everything from cars, tv’s, cash, computers, wedding rings, power tools and even priceless family heirlooms stolen from them by police during raids on their homes. Anything that the police find of value, they are sure to take.
The typical raid goes something like this:
1) The police enter the family home at night with ski-masks, vests, and guns drawn. They look more like paramilitary units than police.
2) They force family members, including elder grandparents and young children face first onto the ground, sometimes separating them from critical devices such as oxygen tanks or other medical necessities.
3) They destroy the home, ripping apart bedrooms and mattresses, breaking or prying doors open, putting holes in the walls, slashing furniture. Sometimes my clients have not been present during the raid, and come home to find what looks like a burglary, only to find out it was the cops who stole their things and left a trail of destruction in their wake.
4) Perplexingly, no charges are filed. At least not at that moment. Medical Marijuana Patients and Caregivers are left in limbo for months, sometimes years before they are charged with a crime.
5) My clients are given 21 days to claim their items, and must pay top dollar to reacquire them from the police who stole them. How are you supposed to get to work without your car? People who have not been charged with a crime are forced to pay a ransom just to get their much needed work cars, trucks, or computers back.
So what happens to that property? More often than not, it is auctioned off never to be seen again, or sold back to the owner for a considerable profit. The police get to keep every penny and with it, buy more powerful guns, flashy motorcycles and military-style vehicles, or form their own SWAT teams, to name a few examples. Each department puts more money into their armories rather than into education and classes for their officers.
The police in Michigan have not been taught about the MMMA. I know this because when I get them on the stand, you wouldn’t believe the things they say when asked simple questions about it. This could be because the only training many Michigan police have came when they were made to attend private seminars (which I was barred from attending) which dealt specifically with the Michigan Medical Marijuana Act, hosted by Attorney General Bill Schuette. Schuette called these seminars, “Clearing the Air,” and in them told police that if they returned the marijuana they seized from legal, card holding caregivers and patients, they would be violating federal law and could be charged with delivery of a controlled substance.
The content of these seminars has since been posted online and can be viewed here: http://annarborchronicle.com/wp-content/uploads/2011/11/Schuette-Seminar.pdf
The people of Michigan didn’t pass the MMMA in 2008 to make it easier for police to catch people who use marijuana, or to create criminals out of police, for that matter. With the highest legal authority in the state telling police that they are committing a crime if they follow state law, we have a clear conflict of interest.
As we see more states enacting not only medical marijuana legalization, but legalization for recreational use, the practice of civil forfeiture becomes threatened, and police will do anything to protect their cash cow. In the 42 states that allow police departments to profit from forfeiture, that cash flow has funded both the militarization of police and allowed law enforcement to make ridiculous purchases, including a margarita machine, a Hawaiian vacation, and a Dodge Viper.
Nationwide, the Wall Street Journal reported the federal government acquired $1 billion in forfeiture from marijuana cases over the past decade. With legalization now in place in Colorado and Washington, with other states sure to follow, forfeiture revenue for the police departments that have relied on it is threatened. According to one report, legal cannabis and the subsequent drop in forfeiture have already caused one drug task force in Washington to cut its budget by 15 percent. That’s great news for due process and property rights. But the police have a trick up their sleeve which allows the to usurp the state legalization efforts and enforce federal law instead. It’s called “equitable sharing.” Local and State enforcement teams can still profit from civil forfeiture by collaborating with Federal Law Enforcement.
Equitable sharing is a two-way street: For the federal government to “adopt” a forfeiture case, cops can approach the feds and vice-versa. The U.S. Department of Justice has applications online for agencies to apply for adoption and to transfer federally forfeited property. Crucially, criminal charges do not have to accompany a civil forfeiture case.
The proceeds from federal forfeitures are deposited into the DOJ’s Asset Forfeiture Fund. After the DOJ determines the size of the cut for the feds, equitable sharing allows the local police to take up to 80 percent of what the property is worth. In fiscal year 2012, the federal government paid out almost $700 million in equitable sharing proceeds to local and state law enforcement agencies.
Equitable sharing tempts cops to become bounty hunters, even in states with legal marijuana. Tony Jalali is living proof of this travesty. Jalali almost lost his businessover four grams of marijuana.
After immigrating to the United States from Iran in 1978, Jalali became a successful small business owner. Jalali owns an office building in Anaheim, Calif.—worth around $1.5 million—that he rents out to fund his retirement.
Among the more staid tenants—a dentist’s office, an insurance company—was ReLeaf Health & Wellness, a medical marijuana dispensary. Posing as a patient with a legitimate doctor’s recommendation, an undercover Anaheim police officer bought $37 worth of cannabis from that dispensary. Keep in mind that medical marijuana sales were—and are—legal in California under state law, and this Anaheim cop worked for local law enforcement, not the feds.
Jalali never bought or sold marijuana. Jalali was not charged with any crime nor was he warned that renting to a dispensary could lead to civil forfeiture. “I had no idea I was doing anything wrong,” Jalali said.
Yet for the DEA, which collaborated with Anaheim police in pursing the forfeiture, that $37 pot sale was enough evidence that Jalali should lose his property.
This should not have happened under California law. Not only did California voters legalize medical marijuana in 1996, state law bans forfeiting real property (like a home or a business) unless the owner has been convicted of a crime related to the property. In fact, Anaheim authorities even requested aid from California prosecutors to take action against Jalali’s property. State officials refused.
But the state’s protections don’t exist on the federal level. By participating in equitable sharing, Anaheim police could directly benefit from a federal forfeiture, bypassing California law to cash in on Jalali’s property.
The equitable sharing loophole still exists. The federal government can continue to prosecute criminal cases and litigate civil forfeiture actions related to cannabis. Citing the risk of federal forfeiture, Wells Fargo, one of Colorado’s largest banks, has refused to finance properties in that state’s marijuana industry. The incentives behind equitable sharing are primed for abuse. Property owners’ protection from forfeiture currently depends on prosecutorial discretion. That is no substitute for meaningful legal reform.
Two separate federal suits filed alleging that the Humboldt County, Nevada Sheriff's Office compelled motorists to waive ownership in their currency and other property on threat of detention:
"Later, Plaintiff was “unarrested”. As a condition for the release of himself and his vehicle he was given a form to sign surrendering and waiving claim to $13,800.00 in cash which the officers had seized from his vehicle. With his liberty in the air, Plaintiff had no choice but to sign the document. The deputies also retained Plaintiff’s firearm, a 40 caliber Ruger, although the form did not relinquish Plaintiff’s right to the firearm." Complaint and Jury Demand, Smith v. Humboldt County, et al (D. Nev. Feb. 28, 2014) (No. 3:12-CV-00475).
"[Deputy] Dove’s seizure of the plaintiff’s money was without cause and unlawful. Upon seizure of Plaintiff’s money, Dove threatened to have Plaintiff’s car seized and towed, leaving Plaintiff afoot, unless Plaintiff “got in his car and drove off and forgot this ever happened.”" Second Amended Complaint, Nguyen v. Humboldt County, et al (D. Nev. Feb. 12, 2014) (No. 3:14-CV-00039).
More on the story here.
A June 2013 audit by Missouri Auditor Tom Schweich's office indicates substantial problems with the management of the Missouri State Highway Patrol's forfeiture fund:
MSHP troops have not always remitted cash seized during the performance of enforcement duties to the Budget and Procurement Division (BPD) in a timely manner. In addition, the BPD does not monitor seizure notifications, does not contact courts and prosecutors to dispose of monies held on old seizure cases, and does not reconcile the Criminal Forfeiture account balance to the listing of the amounts held on each case.
During performance of enforcement duties, MSHP officers sometimes seize cash as evidence. Monies seized may be subject to state forfeiture proceedings. When monies are seized, the seizure is documented in investigation and property reports and the seized monies are remitted to the evidence custodian for safekeeping. The officers are required to notify the BPD of the seizure date, amount seized, and the case incident number. If monies are subject to state forfeiture, the officer is to initiate forfeiture paperwork which is forwarded to the appropriate prosecutor for further processing. When forfeiture proceedings have been commenced, the evidence custodian removes the monies from evidence storage, and forwards the monies to a supervising officer who obtains a cashier's check and remits it along with a copy of the forfeiture paperwork to the BPD. The BPD maintains these monies in the Criminal Forfeiture bank account until further instructions are received from the court regarding distribution of the seized monies.
MSHP troops do not always remit cash seizures to the BPD in a timely manner, and the BPD does not monitor seizures made by the troops. In November 2011, one troop remitted to the BPD cash totaling about $117,000 the troop had been holding on cases with seizure dates as old as February 2000. The funds were discovered during an inventory of the troop's property room following the retirement of the previous property room officer. This remittance comprised about one-sixth of the total remittances in state fiscal year 2012 through May 2012 (about $691,000). MSHP General Order 84-04-1236 requires members seizing cash for forfeiture to notify the BPD of the seizure within a reasonable time. BPD staff do not monitor the notifications from the troops and BPD staff were unaware the troop had been holding seized cash on old cases. To ensure that all monies subject to state forfeiture are timely remitted to the BPD, the BPD should track notifications regarding seized property. The BPD has not contacted courts and prosecutors regarding disposing monies held on old seizure cases. As of May 31, 2012, the Criminal Forfeiture account contained about $958,000 related to 522 cases with seizure dates more than 5 years old. The BPD indicated the monies cannot be disbursed without an order from the applicable state or federal court;however, the BPD has not attempted to determine the status of court actions on old cases or seek court orders for disposition of the monies. Under MSHP General Order 84-04-1236, the commander of the officer making the seizure is responsible for tracking and monitoring the progress of state forfeiture proceeding initiated by members assigned to their component.
The BPD has not reconciled the Criminal Forfeiture account balance to the liabilities listing of amounts held on each case. As of May 2012, the liabilities listing totaled $1,699,984 and exceeded the account balance and undistributed interest by $5,756. Periodic reconciliation of the liabilities list and account balance is an essential tool in ensuring that records are in balance, sufficient assets exist to cover the liabilities, and all monies can be identified.
The status quo of basic mismanagement of seized and forfeited property by the Missouri State Highway Patrol is an open invitation to graft and outright theft by corrupt law enforcement agents. Indeed, the fact that MSHP in 2013 had almost a million dollars in seized or forfeited property deriving from cases that are over 5 years old indicates serious issues with the basic ability of this agency to manage seized funds.
Missouri legislators should consider two complementary options to reform the law as a result of this audit. First, the Missouri legislature should mandate strict transparency requirements of accounting and reporting of the source, process, and disposition of seized and forfeited property. Second, the Missouri legislature should consider changing the law to send proceeds of forfeiture to a Missouri general fund (under the Missouri Constitution, this money should properly go to a general education fund controlled by the legislature).
Brandon Hixon, of the Idaho Reporter (a publication of the Idaho Freedom Foundation), reports on the introduction of House Bill 367 to the Idaho Legislature:
The House Transportation and Defense Committee, on a voice vote, has approved legislation that would significantly broaden the role of the Idaho National Guard. House Bill 367 seeks to amend existing law to allow for circumstances when the Idaho National Guard and the Idaho Military Division could be utilized as a state law enforcement agency.
“There seemed to be no major opposition to this bill,” commented Rep. Linden Bateman, R-Idaho Falls. “It seems like a good idea to me and I supported it.”
The bill also seeks to formalize what is known as the Idaho National Guard Counter Drug Support Program by declaring that it may “assist federal and state law enforcement agencies in interdicting the importation of controlled substances into this state.”
Additionally, the bill declares that the military unit will be “deemed a state law enforcement agency for the purpose of participating in the sharing of property seized or forfeited and receive property and revenues.”
When reached for comment about the new legislation, Monica Hopkins of the Idaho chapter of the American Civil Liberties Union noted that “I think there should be growing concern among citizens at the militarization of our police forces. We have seen communities where federal dollars are going toward the use of tanks and other military weaponry. American citizens should be concerned at the growing militarization of local government power.”
Similarly, Wayne Hoffman of the Idaho Freedom Foundation added that “every Idahoan should be alarmed by the continued use of the military for law enforcement purposes. That is not what the military is for, that is not what the National Guard is for. Yet we’re continuing to see our military deployed for law enforcement purposes or military equipment used for everyday law enforcement purposes. It is a very frightening trend.”
Rep. Brandon Hixon, R-Caldwell, a member of the committee, told IdahoReporter.com that “there are certain parameters set with this bill that make sense for the National Guard’s collaboration with law enforcement.” Hixon said that under the provisions of the bill, the National Guard would be used only in drug crimes and what he referred to as “related lawful property seizures.”
The distinctions between military power and domestic law enforcement power have a long and varied history. The Posse Comitatus Act, passed by the U.S. Congress and signed into law by President Rutherford B. Hayes in 1878, sought to limit the power of the federal government to use military personnel for domestic purposes although state National Guard units are generally regarded as exempt from the law.
Rep. Joe Palmer, R-Meridian, chair of the committee, told IdahoReporter.com that the new legislation will be beneficial to the Idaho National Guard’s budget. He added that Gov. Butch Otter has read the proposal and approves of it.
While it may astonish some that this arrangement would not violate the Posse Comitatus Act of 1878, it is the case that Congress amended Posse Comitatus in 1981 through the passage of the National Defense Authorization Act of 1982, allowing the President to provide Department of Defense support to law enforcement agencies, including limited counterdrug support to federal agencies. This law has provided the legal authority for military participation in counterdrug operations since 1983.
The proposed expansion of state law enforcement authority to to the Idaho National Guard for asset forfeiture participation purposes poses grave danger to property owners in Idaho as this law will intensify the predatory search for valuable real properties that are the incidental site of criminal activity. Indeed, the defense of a recent, highly-publicized federal asset forfeiture against the Motel Caswell in Massachusetts indicates that these counterdrug investigations often begin when special agents comb through arrest and property records, looking for opportunities to raise revenue through strategic forfeiture proceedings. It is also worth noting that Idaho's forfeiture laws provide very poor protections to property owners. As the Institute for Justice notes in its "Policing for Profit" report:
Based on limited data, while Idaho appears to only modestly pursue forfeitures against property owners, its civil forfeiture laws still put the property of ordinary citizens at risk. To forfeit your property, the state only needs to show that it was more likely than not that your property was used in some criminal activity—the legal standard of preponderance of the evidence. To recover seized property, an innocent owner bears the burden of proving his innocence. Moreover, law enforcement in Idaho reaps all of the rewards of civil forfeitures—they keep 100 percent of all funds and face no requirement to collect or report data on forfeiture use and proceeds.
It is greatly unfortunate that instead of providing greater security to private property owners, the Idaho legislature is considering further undermining property rights.
Jerry Berger in St. Louis has the scoop:
United States Attorney Richard Callahan said today that for the fiscal year 2013, his office had collected $11,448,830 in criminal and civil actions during the year. Of this amount, $10,113,957 was collected in criminal actions and $1,334,873 was collected in civil actions. In addition, $11 million also assisted partner law enforcement agencies in the Eastern District of Missouri in collecting an additional $8,442,329 in asset forfeiture actions in FY 2013. Forfeited assets are deposited into the Department of Justice Assets Forfeiture Fund and are used to restore funds to crime victims and for a variety of law enforcement purposes.Earlier today, Attorney General Eric Holder announced that the Justice Department collected approximately $8.1 billion in civil and criminal actions in the fiscal year ending September 30, 2013. The more than $8 billion in collections in FY 2013 represents nearly three times the appropriated $2.76 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.
Last year, Utah legislators passed without debate or opposition HB 384, a bill that gutted the initiative reforms that had been made to Utah's asset forfeiture laws by citizen initiative in 2000. Fortunately, our colleagues at the Libertas Institute picked up on this, and published an analysis criticizing the law:
A 2000 citizen initiative that passed by 69% of the vote in Utah introduced substantial restrictions on asset forfeiture—the process whereby the government seizes a citizen’s property—but several key provisions were overturned unanimously by the legislature in 2013 after lawmakers were told that the bill was a simple “recodification.”
The initiative was created in large measure to prevent law enforcement agencies from directly profiting from the property they seized, as this financial opportunity created an incentive to seize property. The legislature amended the law in 2004 introducing some minor changes, including allowing proceeds from seized property to be funneled back to the agencies through the Commission on Criminal and Juvenile Justice instead of being deposited in the Uniform School Fund.
In the 2013 legislative session, HB384 gutted many of the important protections introduced through the 2000 initiative, and left in place by the 2004 amendments. Sponsored by Representative Dee and Senator Bramble, the bill was pitched to colleagues as a simple “re-codification” of existing law—a “clean up bill” with little to no substantive changes being made. In the rush of the last days of the session, with likely few (if any) legislators reading over 50 pages comprised heavily of new text, and with the assurance of the bill being a re-codification, both chambers unanimously approved the bill.
The Utah Attorney General's office was quick to respond with a brief defending the changes in the law. Most notable is the bullet point justifying the new cap on attorney's fees recoverable by a person who successfully defends their property from forfeiture (emphasis mine):
HB 384 caps the amount that an attorney may obtain if an attorney prevails in a forfeiture action. Previously, the statute allowed prosecutors who litigated forfeiture cases on behalf of the State to obtain attorney’s fees in an amount up to 20% of the amount forfeited. Now this same cap also applies to a claimant’s attorney. By setting a limit on attorney’s fees it will take away the incentive for attorneys who actively promote the legalization of drugs in the state of Utah from soliciting clients who are engaged in criminal activity. A cap on attorney’s fees will encourage litigants to resolve cases in the best interests of their clients rather than in the best interests of the attorneys.
In other words, the Utah Attorney General believes that this provision exists to undermine a group of people deliberately classified by their participation in First Amendment protected activities.
Defense attorneys serve as a vital channel for information in a democratic society. As the trained advocates who hold the government to account in the prosecution of criminal investigations and civil forfeiture, they have a unique and sometimes solitary view of the exercise of government power. To restrict their participation in the legal system is to undermine an array of fundamental rights of a civil society, and represents a nakedly authoritarian use of power.
Drug policy reform advocates should understand the existential threat that civil forfeiture thus poses to a free speech, the fundamental tool in any reformer's toolkit.
Addendum: The Libertas Institute published a response yesterday to the AG's response, here.
The Albuquerque Journal Editorial Board published the following unsigned editorial on Nov. 27, 2013:
A court ruling that an Albuquerque ordinance allowing police to seize and keep vehicles used by suspected drunken drivers is unconstitutional should give city officials pause to reconsider their newly passed law that allows seizure of vehicles used in prostitution cases.
State District Judge Clay Campbell ruled the DWI seizure ordinance violates due process. He said that while the ordinance tells the administrative hearing officer to consider only whether the “(arresting) officer had probable cause to seize the vehicle,” it does not give an innocent owner – for instance, someone who had loaned the driver a car when he was sober – a “meaningful” opportunity to contest the seizure.
City attorney David Tourek says the city already is returning vehicles to innocent owners.
Faced with this legal setback, the City Council should revisit the “johns ordinance” that allows Albuquerque police to seize a vehicle used in a prostitution crime upon the arrest of a participant. The idea is to target johns, not just prostitutes.
A conviction isn’t required, but it should be. In the U.S. judicial system, people are still considered innocent until proven guilty, and they shouldn’t have to suffer a penalty until guilt is proven. Councilor Rey Garduño raised the point when he voted against this new ordinance. His concerns were that someone could be wrongly accused of a crime and, again, it’s possible the car used in the crime could be a borrowed one. Plus, regardless of status, a hearing on a seized vehicle costs $50.
This isn’t the first time a judge has smacked down a seizure program. A separate court ruling put an end to the Albuquerque Police Department and the Bernalillo County Sheriff’s Department seizures of cash from people arrested during traffic stops. The county had to cough up more than $3 million in damages and the city settled for $882,900.
Police may view forfeiture programs as a way to make a drunk or a john think twice before getting behind the wheel, but these tools should not be used without due process for all. Both laws should be repealed.
New Mexico's forfeiture laws are pretty bad. As the Institute for Justice notes:
Even after a reform effort in 2002, New Mexico’s civil forfeiture laws still do not offer adequate protections for property owners. To secure a civil forfeiture, the government must prove, by clear and convincing evidence, that property is related to criminal activity and thus subject to forfeiture. This is a higher standard than most states but still lower than proof beyond a reasonable required to establish criminal guilt. Moreover, in most instances, property owners have the burden of proof for innocent owner claims. And law enforcement may still receive 100 percent of the proceeds from any forfeiture.
Lindsay Toler at the RiverFront Times reports:
Jimmy Tebeau -- who turned his 350-acre farm into a concert venue complete with its own open-air drug market -- will be out of jail earlier than expected.
The Federal Bureau of Prisons lists Tebeau's new release date as September 7, 2014, five months earlier than his original release in February 2015.
Update: Tebeau's lawyer Scott Rosenblum says the early release was negotiated up front during his sentencing, especially since Tebeau cooperated financially by surrendering his farm to authorities.
Tebeau faced a 30-month sentence after he pleaded guilty in June 2012 to maintaining a drug-involved premises -- the federal government's way of saying Tebeau allowed a rampant drug market at Camp Zoe, where he lived with his wife and children. Tebeau was also fined $50,000 and ordered to serve 200 hours of community service.
Tebeau's land was seized by the federal government and sold for $640,000 to Missouri State Parks, which is turning the former hippie haven into a park for fishing, floating and hiking.
Tebeau won't see any of that money since he lost his land after his conviction. The money doesn't even go to Missouri schools, as it would have if a local law-enforcement agency had arrested Tebeau. Instead, all that money goes to the DEA and the Missouri State Highway Patrol, two agencies who investigated the drugs sold at Camp Zoe.
It is worth noting that Tebeau's plea agreement with the government contained the admission that Tebeau himself had done nothing wrong. Moreover, it is clear that the Missouri State Highway Patrol and any other Missouri law enforcement agencies that receive proceeds from the sale of Camp Zoe could not have done so had the investigation and forfeiture been conducted under Missouri law. Not only does the Missouri Constitution direct forfeiture proceeds to education but the Missouri Constitution expressly bars the use of asset forfeiture to take an "estate" (as attorney Dave Roland noted in December 2010).
It is unlikely that Jimmy Tebeau would have faced jail time or forfeiture of his estate if Missouri law enforcement agencies had not rendered their services to the Drug Enforcement Agency. Indeed, without the financial incentive from a federal forfeiture payout, Missouri law enforcement would hew closer to the laws governing their conduct. Perhaps they would have arrested the drug dealers instead of seizing Tebeau's property, or worked harder to ensure the safety of festival-goers.
Missouri can put a stop to this subversion of state law enforcement to federal priorities by prohibiting the use of forfeiture funds by law enforcement entirely; if federal forfeiture revenues are available, the Missouri legislature should insist on having those revenues sent to the state's general fund. Without such reforms, Missourians will see the federal government increasingly dictating the affairs of local life, as Missouri law enforcement ramps up increasingly lucrative partnerships with federal agencies looking for profit.
The Department of Justice Office of the Inspector General (OIG) last month released an audit of the Lansing, Michigan Police Department's use of of asset forfeiture revenues through the federal "Equitable Sharing" Program:
The U.S. Department of Justice (DOJ), Office of the Inspector General, Audit Division, has completed an audit of the use of DOJ equitable sharing receipts by the Lansing, Michigan, Police Department (Lansing PD). The audit covered the Lansing PD’s fiscal years (FY) 2009, 2010, 2011, and 2012.3 During that period, the Lansing PD received DOJ equitable sharing revenues totaling $823,960 to support law enforcement operations.
In 2012, the latest year data is available, Michigan law enforcement received $17,114,435 in total through Equitable Sharing of which Lansing PD received $989,047. Incidentally, forfeitures by Michigan statute in 2012 totaled $13,777,858.
The OIG made four findings that the Lansing PD had violated federal Equitable Sharing guidelines:
We found that the Lansing PD did not fully comply with equitable sharing guidelines with respect to accounting for equitable sharing receipts and the allowable use of equitable sharing funds. Specifically, we found:
- The Lansing PD commingled DOJ equitable sharing funds with state of Michigan asset forfeiture funds.
- The Lansing PD did not maintain a DAG-71 log for reconciling equitable sharing receipts.
- The Lansing PD improperly used $3,061 in equitable sharing funds to pay for overtime of a civilian employee.
- The Lansing PD used $12,563 in equitable sharing funds for officers’ uniform allowance without having proper supporting documentation.
While these issues are serious from a "compliance" standpoint, the larger picture is more important. The increasing reliance of Lansing's Police Department on funds obtained through federal asset forfeiture is not good news for property owners, who face much greater barriers to defending their property in federal forfeiture proceedings than in Michigan courts.
Michigan legislators will be addressing proposals to increase the transparency of forfeiture revenues and to prohibit forfeiture absent a criminal conviction in 2014. Further reform proposals should include some restrictions on the ability of Michigan law enforcement to send forfeitures to federal agencies, a tactic that is increasingly being used to evade more restrictive state forfeiture statutes. And revenues from federal agencies should not go directly to local police departments; state lawmakers could restrict that practice by mandating that forfeiture revenues be sent to the general fund of the receiving agency's governing body.