FEDS IMPLEMENT MAJOR CHANGE TO ASSET FORFEITURE RULES
On January 16, 2015, Attorney General Eric Holder announced that “effective immediately, the Justice Department is taking an important step to prohibit federal agency adoptions of state and local seizures, except for public safety reasons. . . .”
The Justice Department’s civil asset forfeiture program, called Equitable Sharing, allows local and state police to make asset seizures and then have them “adopted” by federal agencies, which share in the proceeds. The program allowed local police departments and drug task forces to keep up to 80 percent of the proceeds of the adopted seizures, with the rest going to federal agencies.
The practice allowed local law enforcement to retain a greater portion of any seized assets – such as cash or other valuables – than under many state laws. Under “adoptions,” local police agencies would seize property in accordance with federal law and ask the federal government to “adopt” the forfeiture. The U.S. would then sell the assets and return a large portion of the proceeds to the state or local agency.
The new policy will allow some limited exceptions to the prohibition, including seizure of illegal firearms, ammunition, explosives and property associated with child pornography which, apparently, is a small fraction of the total. Nonetheless, Holder said that forfeiture is still a “critical law-enforcement tool when used appropriately.’’
However, this new policy will eliminate virtually all cash and vehicle seizures made by local and state police from the program. According to a Washington Post investigation published in September, local police have made cash seizures worth almost $2.5 billion from motorists and others without search warrants or indictments since the terrorist attacks of September 11, 2001.
Although local law enforcement can continue to make seizures under their own state laws, the federal program was easy to use and required most of the proceeds from the seizures to go back to local and state police departments. Many states, however, require seized proceeds to go into the general fund which is not earmarked for law enforcement purposes.
Holder said there is also less need for federal seizure adoptions. In the 1980s, when the policies took effect, few states gave police the authority to make civil seizures and forfeit the assets of criminals in the way that federal law allowed. “Today, however, every state has either criminal or civil forfeiture laws, making the federal adoption process less necessary,” Holder’s statement said. “Indeed, adoptions currently constitute a very small slice of the federal asset forfeiture program. Over the last six years, adoptions accounted for roughly three percent of the value of forfeitures in the Department of Justice Asset Forfeiture Program.”
The use of civil asset forfeiture has been controversial for years and challenged by many as unfair and abusive. A report in the Washington Post states that “civil asset forfeiture is one of the most powerful — and unusual — law enforcement tools. Police do not need evidence of a crime to use it, because it is a civil action against an object, such as currency or a car, rather than a person. As a consequence, protections common in criminal law do not apply. In fact, owners who want to recover their cash or property must show it is theirs and demonstrate it is not tied to crime.”
Forfeiture has its basis in British admiralty law, but it became a part of the fight against drugs in the United States beginning in 1970, when Congress allowed police to seize aircraft, boats and other property used to transport narcotics or bought by drug lords. In the 1980s, the law was expanded to include cash.
After the Justice Department created the Asset Forfeiture Program it began allowing federal agencies to “adopt” seizures made by state and local authorities. Those changes led to a massive increase in money deposited into the federal forfeitures fund as seizures by local and state police surged. At the same time, allegations of police abuses also increased. According to the Washington Post article, Holder “also believes that the new policy will eliminate any possibility that the adoption process might unintentionally incentivize unnecessary stops and seizures.”
Holder said seizure adoptions will continue to be employed by joint local and federal operations, but only in limited circumstances when public safety is at risk and where local and federal authorities are collaborating in cases clearly involving criminal activity. Although joint federal and local investigations accounted for only 9 percent of all seizures, they accounted for 43 percent of the value of all seizures.
The Justice Department noted that civil asset forfeiture has hurt criminals and their organizations and has also enabled the government to refund money to crime victims — about $4 billion over the past 15 years.
“Asset forfeiture remains a critical law enforcement tool when used appropriately — providing unique means to go after criminal and even terrorist organizations,” Holder said. “This new policy will ensure that these authorities can continue to be used to take the profit out of crime and return assets to victims, while safeguarding civil liberties.”
HOW THIS AFFECTS YOUR AGENCY
The impact on local law enforcement will vary depending on its use of the federal asset seizure forfeiture program. As noted, those that participate in joint local/federal task forces will still be able to benefit from the program but only under those circumstances.
Local agencies can still rely upon state authorized seizure programs but, as noted above, in many cases the state program, unlike the federal program, requires any assets seized to go to the general fund and not be earmarked for law enforcement purposes.
As reported in the Washington Post article, “some police departments have shown an apparent preference for federal law over state laws. Equitable Sharing required the seizure proceeds to go back to the departments, while state asset forfeiture programs can mandate that the money go into the state’s general fund.”
It appears from statements made by Holder that this is the first of several modifications of federal programs which might impact on local law enforcement. In his announcement, Holder said the new policy is the first step in a “comprehensive review” of civil forfeiture in general. He did not go into any greater detail as to future changes.
It is imperative that agencies confer with their legal counsel for advice and guidance when implementing, or reacting to, changes in the law.
As always, if you wish to discuss this matter in greater detail, do not hesitate to contact me at (714) 446 – 1400 or via email at mjm@jones-mayer.com.
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