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DOJ directive creates civil forfeiture loophole

July 26, 2017

As Indiana considers revamping its civil forfeiture law, the federal government has given state and local law enforcement a mechanism to potentially do an end-run around whatever reforms are made.

The U.S. Department of Justice issued a directive July 19 that essentially rolled back the limitations placed on asset seizures during the Obama administration. This gives police and sheriff departments across the country the ability to use federal rules to seize and keep the property of individuals who have not been charged with or convicted of a crime.

Civil forfeiture is widely criticized by Republicans and Democrats, conservatives and liberals alike. But in announcing the policy change, U.S. Attorney General Jeff Sessions touted the practice as taking back ill-gotten gains, preventing new crimes and weakening criminal organizations. In addition, he continued, the money from the assets is used to fund new equipment and training for law enforcement.

“In departments across this country, funds that were once used to take lives are now being used to save lives,” Session said.

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Timothy Morrison, Indiana University Maurer School of Law adjunct faculty member and retired first assistant U.S. attorney for the Southern District of Indiana, said giving law enforcement the ability scoop up property has drawbacks as well as benefits. It is not a black-and-white issue.

Even so, he acknowledged, “I’m not sure if the headaches you get are worth all the effort.”

Civil forfeiture can get drugs, money and weapons off the streets. Taking the resources can cut a criminal operation’s ability to hurt, threaten and kill.

However, Morrison said, the practice is prone to abuse. Innocent people who had no part in breaking the law and are never even arrested can lose their property. “And many law enforcement officials are not happy (with civil forfeiture) because they see it as the money controlling the investigation,” he said, explaining departments have the financial incentive to go after the person with the most assets rather than the most dangerous individual.

The directive from the Justice Department lifts the restrictions on federal adoption. This allows state and local law enforcement to take property they believe is tied to a crime and forfeit it to the federal government thus circumventing any state laws prohibiting civil forfeitures. In turn, the federal administration kicks back 80 percent of the assets to the local police, sheriff and prosecutors.

Indianapolis attorney Todd Ess has represented individuals contesting the civil forfeiture of their property and has testified about the state’s forfeiture laws before the Indiana Legislature. He expects the Justice Department’s reversal will bring more activity to the courthouse.

“There might be an uptick in the number of civil forfeitures filed in federal court, which is exactly what Sessions’ order is designed to do: keep forfeitures out of state courts,” he wrote in an email.

Legislating change

During the 2017 session of the Indiana General Assembly, 10 bills were introduced that dealt with civil forfeiture. Two of the measures would have divided the proceeds differently among the state agencies. Five proposals would have required a conviction before the property could be seized and of those, four would have taken the extra step of prohibiting federally adopted forfeiture.

According to the nonprofit Institute for Justice, 24 states in the last three years have enacted laws designed to curtail civil forfeitures. Some states have abolished the practice outright and forbid federal adoption.

Sen. Phil Boots, R-Crawfordsville, authored a bill last session that would have required local law enforcement to get a conviction before seizing an individual’s property and would have prevented the police and sheriff from turning the confiscated items over to the federal government. The measure, Senate Bill 8, passed the Indiana Senate on a 40-10 vote but did not get a hearing from the Courts and Criminal Code Committee in the House of Representatives.

The only forfeiture bill that did make it through both chambers was authored by Rep. Tim Wesco, R-Osceola. House Enrolled Act 1123 called for a study of civil forfeiture laws to recommend changes. The topic has been assigned to the Interim Study Committee on Courts and the Judiciary. That committee has yet to meet this year.

Wesco declined to comment for this story.

Critics of civil forfeiture say the practice upends due process. People who get their property seized are being punished for a crime they did not commit and they are presumed guilty, forcing them to prove their innocence. Also, it has a standard of proof much lower than beyond a reasonable doubt.

When unveiling the directive, Sessions pointed to new safeguards that are included to prevent abuse. In particular, law enforcement officials will have to show probable cause for the seizure when seeking a federal adoption, and seizures of $10,000 or less must be accompanied by either an arrest or admission of guilt.

gedge-sam-mug.jpg Gedge

However, attorney Sam Gedge of the Institute for Justice called the protections “window dressing.” To reform civil forfeiture, he said the standard of proof should be raised, the seizure of property should only take place after the person has been charged or convicted of the crime, and police and prosecutors should not be able to keep the proceeds from the forfeited property.

“It’s disappointing,” Gedge said of the Justice Department’s new policy. Noting the limitations put in by former U.S. Attorney General Eric Holder were abolished with the stroke of pen, he said Sessions’ decision “underscores the need for reform at the state and federal levels.”

In the courts

Morrison noted taking cars, cash and other items from people who have not committed a crime can exact a heavy cost on law enforcement. Namely, citizens lose faith in the police and the criminal justice system.

But the money that comes from the civil forfeitures is often highlighted as the driving force behind the practice. Indiana Senate Bill 41, authored by Jeffersonville Republican Sen. Ron Grooms in the 2017 session, would have altered the division of proceeds from civil forfeitures. A third of the pot would have gone to the prosecution and, of the remaining amount, 15 percent would be funneled to the state’s Common School Fund and 85 percent turned over the law enforcement agencies.

The fiscal analysis of the bill provided 2015 forfeiture data from the Indiana Prosecuting Attorneys Council. Of the $1.83 million forfeited that calendar year, $1.79 million was used to reimburse expenses of the prosecutors and law enforcement while $38,477.38 was dropped into the Common School Fund.

The Institute for Justice is challenging civil forfeiture in Indiana by focusing on where the money goes. In Jeana M. Horner, et al. v. Terry R. Curry, Marion County Prosecutor’s Office, et al., 49D06-1602-PL-004804, the institute, represented by Gedge, is arguing the Indiana Constitution mandates that all proceeds from civil forfeiture should go into the Common School Fund.

A trial date has been set for January 2018 but Gedge anticipates the case will be settled in the plaintiffs’ favor on summary judgment. Yet even with a victory for Jeana Horner, law enforcement in the state could continue to seize property through federal adoption. That mechanism was not part of the lawsuit, Gedge said.•

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