New Forfeiture Law Proposed for Orange County, NY

The legislature in Orange County, NY is considering enacting a new forfeiture statute proposed by county District Attorney David Hoovler. Though law enforcement in the county already uses both current state and federal statutes, this new county-level statute would provide a "third route" that would keep all of the income from forfeiture within the county. Forty-one percent would be given to the seizing agency, the same as state law, but the rest would be divded between the county government and the District Attorney's office. Orange would join New York City, Nassau, Oneida, Westchester, and Rensselaer counties which all have their own forfeiture statutes.

Canadian Media Sounding the Alarm

A Senior Washington Correspondent for the Canadian Broadcast Corporation warns Canadians about the dangers of traveling with large amounts of cash in America. His travel advice?

Avoid long chats if you’re pulled over. Answer questions politely and concisely, then persistently ask if you are free to go.

Don’t leave litter on the vehicle floor, especially energy drink cans.

Don’t use air or breath fresheners; they could be interpreted as an attempt to mask the smell of drugs.

Don’t be too talkative. Don’t be too quiet. Try not to wear expensive designer clothes. Don’t have tinted windows.

And for heaven’s sake, don’t consent to a search if you are carrying a big roll of legitimate cash.

As the Canadian government notes, there is no law against carrying it here or any legal limit on how much you can carry. But  if you’re on an American roadway with a full wallet, in the eyes of thousands of cash-hungry cops you’re a rolling ATM.

Former Justice Department Officials Slam Asset Forfeiture

The Washington Post continues its barrage of coverage with an op-ed penned by two former federal officials. John Yoder, director of the Asset Forfeiture Office from 1983 to 1985, and Brad Cates, who directed the office from 1985 to1989, have written a stinging indictment of the modern forfeiture program.

Asset forfeiture was conceived as a way to cut into the profit motive that fueled rampant drug trafficking by cartels and other criminal enterprises, in order to fight the social evils of drug dealing and abuse. Over time, however, the tactic has turned into an evil itself, with the corruption it engendered among government and law enforcement coming to clearly outweigh any benefits.

The full op-ed can be read here. Yoder and Cates condemn the many changes made to the practice since the early days, including expanding the scope of property that could be forfeit, allowing law enforcement to keep and use recovered property, and the increasing number of crimes that can trigger forfeiture. They refer to modern civil asset forfeiture and money laundering laws as "gross perversions of the status of government amid a free citizenry" and recommend the complete abolishment of civil asset forfeiture.

Yoder and Cates really hit the nail on the head and pound it flat. Whatever noble intentions these laws were conceived with have been distorted and the amount of abuse this has led to is indefensible.

News Roundup

• Lawmakers in Wyoming will sponsor a bill in the 2015 legislative session that will end civil asset forfeiture in the state.
• George Leef argues for the abolishing of civil asset forfeiture laws in Forbes.
• The Washington Post ran an excellent series on asset forfeiture last week.

Rand Paul Introduces Asset Forfeiture Reform Bill

Rand Paul introduced a landmark bill last Friday that makes several significant changes to federal asset forfeiture law. It aims to remove the profit incentive by depositing sales proceeds in the Treasury's General Fund instead of giving it directly to the seizing agency.  The government must also show a substantial connection between the property owner and the alleged crime, that the owner "intentionally used the property in connection with the offense" or "knowingly consented or was will-fully blind to the use of the property by another in connection with the offense" before forfeiting property.

It also raises the standard of proof for federal prosecutors to meet before forfeiting property. The bill raises the federal court's standard of proof to "clear and convincing evidence", which makes it higher than many states. Radley Balko reports that the bill also requires states to "abide by state law" when they forfeit property, but that language is not in the current bill so it is hard to know what means exactly and if it applies to both financial and procedural aspects of state forfeiture law.

This is pretty big. Asset forfeiture is a big money maker for actors at all levels of government. The federal asset forfeiture fund had more than $2 billion in net deposits in 2013. The Department of Justice made more than $656 million in equitable sharing payments to law enforcement agencies in the 50 states. Law enforcement in New York and California have received more than $1.2 billion through the program between 2000 and 2013.This is not necessarily a bill that will be greeted with open arms by the law enforcement community.

 These changes have been a long time coming. Henry Hyde proposed raising the burden of proof to clear and convincing evidence almost 20 years ago. His reform efforts were stymied and his bill, passed as the Civil Asset Forfeiture Reform Act in 2000, settled for the lower standard of a preponderance of the evidence, which it stands at today. And while it would curb the problems associated with federal adoption, it would not address the myriad problems of state forfeiture laws. This bill represents a lot of progress though and Senator Paul should be commended for taking up the issue.

Tool or Profit Center?

The Daily Tribune out of Michigan considers the question in a new article on the state's medical marijuana industry. They focus on the use of forfeiture by Oakland County's Narcotics Enforcement Team.

For Oakland County’s Narcotics Enforcement Team, forfeitures totaled $924,358.06 in 2012. That total included $469,167.19 in cash, a share of federal forfeitures totaling $174,676.52, and 140 vehicles seized in drug raids and auctioned for $215,014.35, according to numbers provided by the Oakland County Sheriff’s Office.

In 2013, NET operations cost $1,191,597.40. Forfeitures in property and cash seized totaled $834,519.97.

 But, according to Oakland County Undersheriff Michael McCabe, forfeiture is just a tool against crime, not a money making venture.

“It’s not about making money; this is not an enterprise system; it’s not a profit-making business,” said McCabe. “The sheriff has always said he’s not in the business to make money. This isn’t a profit center.”

But, he added, “There are other places outside Oakland County that take a different approach than we do.”

News Roundup

• Police in Meriden, Connecticut used their asset forfeiture fund to purchase new mountain bikes and uniforms for a neighborhood patrol unit.
• The Taranaki Daily News has an article about New Zealand's uptick in asset forfeitures in since the passage of the Criminal Proceeds Recovery Act in 2009. The bill introduced the use of civil asset forfeiture to New Zealand. Previously forfeitures were limited by the requirement for a criminal conviction.
• The Treasury Department's anti-money laundering unit FinCEN had to rescind 11 job offers and temporarily freeze hiring after an Office of Personnel Management investigation determined that the agency was illegally screening job candidates. Federal agencies can only screen job candidates by the criteria given in the job listing and FinCEN reportedly targeted lawyers for open positions without ever stipulating that the positions were open only to lawyers.
• Over at Business Insider, Ethan Burger suggests asset forfeiture could be used to add some bite to recent sanctions against Russia.
• Authorities in the Philippines are auctioning off assets recovered after 27 years of litigation. The properties, valued at over $5 million, are connected to two associates of former president Ferdinand Marcos. Marcos was removed from office in 1986 after ruling the Philippines for 21 years. The properties include several homes and a sports club.
• Rep Kendall Kroecker has announced that he will be running for re-election in the Wyoming legislature. Rep. Kroecker sponsored HB0076, which would have increased the standard of proof required before law enforcement could forfeit property. The bill passed in the House but failed to make it out of Senate committee.
• Police in Downey, California financed the construction of a new training room using asset forfeiture funds. The new facilities will be used to train officers "who have been accused of using excessive force" in lethal and non-lethal arrest techniques.
• The Department of Justice has filed a civil forfeiture complain the Central District of California in an attempt to recover $700,000 in corruption proceeds. The money was seized from the sale of house formerly owned by Korea's ex-president Chun Doo-hwan's son. Doo-hwan's son, Chun Jae Yong, allegedly purchased the home using proceeds "traceable to his father's corruption." The US is working on the investigation in conjunction with South Korea's Supreme Prosecutor's Office, Ministry of Justice, and the Seoul Central District Prosecutor's Office.
• The Inquisitr tells the story of the man who had $50,000 in casino winnings seized during a traffic stop in Nevada. Tan Nguyen was never charged with or convicted of a crime and had to sue the Humboldt County Sheriff's Office to recover his money.
• The Pttsburgh Post Gazette has an excellent piece on law enforcement's use of confidential informants. They note that the federal government spent more than $26 million in asset forfeiture cash in 2013 on confidential informants.  
• Authorities in Jamaica have spent nearly four years searching for  the assets of drug kingpin Christopher 'Dudus' Coke and have only been able to link a small fraction of assets to his criminal activity.

News Roundup

• Texas Lawyer (registration required) has a short write up on the impact of Kaley v. United States on defense attorneys, including several tips for mitigating the impact of the decision on a defendant.
• The federal government has filed forfeiture papers against former New Orleans Mayor Ray Nagin. The money sought is connected to Nagin's conviction on corruption charges back in February.
• The Nassau County Police Department launched a new website developed with $300,000 in forfeiture proceeds.
• Police in Kansas have used a combination of asset forfeiture and grant money to purchase a 3d scanner for use in criminal investigations. The scanner uses a laser to scan and map crime scenes to determining bullet trajectories.
• President Pohamba of Namibia announced the formation of an asset forfeiture unit in his State of the Nation address.
• Suffolk County DA Daniel F. Conley is donating $5,000 in asset forfeiture cash to Operation LIPSTICK, a non-profit organization dedicated to "[p]reventing women from being used to buy, hide or hold guns for those who can't legally own them."

Forfeiture Reform in Minnesota

Minnesota’s Governor signed SF874, the state’s latest asset forfeiture reform bill, in to law on May 6^th. The bill makes major changes to the state’s civil forfeiture statute, which now requires either a guilty plea or a criminal conviction before civil forfeiture can occur and shifts the burden of proof from the property owner to the prosecution.

While the changes are welcome, they’ve been a long time coming. It’s been five years to the day that the state Office of the Legislative Auditor issued the scathing report that shut down the Metro Gang Strike Force and publicized the problems with the state’s asset forfeiture procedures. Similar reforms emerged in the immediate aftermath of the strike force scandal, but the conviction requirement did not make it out of committee. Now, a half decade later, SF874 the state Senate 55-5 and the House unanimously.

The catalyst for these reforms is perhaps one of the most egregious instances of civil forfeiture abuse in recent history. The Metro Gang Strike Force, established by the Minnesota legislature in 2005, was subject of a special review by the Office of the Legislative Auditor after concerns arose over the agency’s financial reports. The OLA’s audit found more than $18,000 in seized cash missing, as well as 13 seized automobiles and problems with the agency’s internal controls. A subsequent investigation ordered by the Commissioner of Public Safety found “deeply disturbing behavior” and misconduct the panel characterized as “appalling and outrageous”. The panel’s findings included employees taking seized property for personal use, the sale of seized property, including jet skis and big screen tvs, to officers and their families, items that were seized but never entered in to evidence, and indiscriminate seizure of property unconnected to any crime.

The two reports issued by the OLA touch upon many of the problems activists have spent years warning lawmakers about, including the development of a profit motive and the seizure of property despite the owner's innocence. Seizures became a priority for a certain subset of the Strike Force that viewed forfeiture income as necessary to the survival of the unit. Some officers even described themselves as “money police”, such was their emphasis on seizing assets. Additionally, the Strike Force used so-called "saturation details" as a pretext to search and seize money from people who were not suspected of, nor were ever charged with, a crime. Fallout from the scandal effectively shut down the Strike Force and lead to a class action lawsuit that resulted in $840,000 in payouts to the agency’s victims.

News Roundup

It's been awhile since my last update so this will be a big one.

• The most important news is the Supreme Court's 6-3 decision in Kaley v. United States, which has received fairly wide coverage in the media since it was issued in late February. The petitioners in the case attempted to challenge the government's pre-trial seizure of their home and a $500,000 certificate of deposit that were allegedly tied to the sale of stolen property. The Kaleys wanted to challenge the the seizure on the basis of a lack of evidence to support the underlying criminal charges, not the property's connection to the alleged criminal conduct. The Supreme Court decided against the Kaleys, ruling that they could not challenge the grand jury's finding of probable cause that was used by the government to support the seizure. I'll have more analysis on this case next week, but until then you can read coverage of the case at Slate, Reason, and Forbes.

• In addition to their coverage of the Kaley decision, Slate also ran an article about state and local law enforcement in states like Washington and Colorado taking part in the equitable sharing program despite recent changes in their jurisdiction'ss marijuana laws.

•  The US has frozen more than $458 million connected to former Nigerian dictator Sani Abacha. It's being heralded as the largest kleptocracy related forfeiture in history. 

• The Hudson Valley Reporter has a report on the use of forfeiture by law enforcement in Putnam County, New York. The paper reports that Putnam's asset forfeiture unit "oversaw a total of 130 forfeiture cases, most of them involving vehicles. While most defendants chose to forfeit the value of their vehicles, 17 were sold at auction, and 14 were released to lien holders after payment of administrative fees. Fifteen cases involved the forfeiture of cash proceeds of crimes."

•  The Mackinac Center for Public Policy, based in Michigan, has a posted a brief statement that summarizes their view on asset forfeiture.

• The Livingston Daily has a piece on a developing lawsuit regarding the seizure and attempted forfeiture of more than $100,000 in cash from two Michigan businesses. The businesses alleged crime? Routinely making cash deposits totalling less than less than $10,000, the amount which triggers a report to the federal government. The practice is known as "structuring", essentially purposefully depositing money in a way to avoid notice by the federal government.

• Forfeiture is being scrutinized in Nevada after two lawsuits were filed against the Humboldt County Sheriff's Department. Sheriff's deputies seized $50,000 in cash and two cashier's checks from one man and $13,800 in cash and a .40 caliber handgun from another. No arrests were made, no drugs were found, and no charges have been filed against the property owners.