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Justices hear probable cause questions in case of $60K seized cash

April 11, 2019

Questions of whether probable cause existed for law enforcement to seize more than $60,000 in cash from a FedEx package were heard before the Indiana Supreme Court on Thursday, with an attorney for the state urging justices to overturn recent precedent to allow the seizure.

Justices heard oral argument in Michael Hodges v. State of Indiana, 19S-MI-117, in which more than $60,000 in cash was seized by an Indianapolis detective at a package shipping company after finding insufficient evidence to prove the money was involved in illegal activities.

Due to the parcel’s appearance and his K-9’s reaction to the parcel’s odor, the detective inspecting the package suspected it was related to drug trafficking or money laundering. But upon finding no evidence of illegal activity and no allegation that Michael Hodges had been charged with any state or federal offenses in connection with the package, the Indiana Court of Appeals ruled the cash could not reasonably be suspected to be involved in drug trafficking or money laundering, therefore ordered its return.

Representing Hodges before the high court, Indianapolis attorney Matt Abels maintained that the there was insufficient evidence to support the three bases for the cash’s seizure — proceeds of bulk cash smuggling, money laundering and drug trafficking.

“The trial court seemed to think that just a large amount of money in and of itself was evidence that it was bulk cash smuggling,” Abels contended.  

He argued that little to no evidence existed connecting the money as proceeds of criminal activity, as required for money laundering under Indiana statute, and that the package was sent in the same manner of thousands of parcels shipped across the country daily, separating it from the drug trafficking argument.

To further prove that point, Abels noted that the high court previously declined to grant transfer in Bowman v. State, 81 N.E.3d 1127 (Ind. Ct. App. 2017), modified on denial of rehearing, trans. denied, cert. denied, which the appellate court relied on in its ruling inHodges. 

In Bowman, the COA reversed the seizure of $30,000 being shipped in a similar manner by two Illinois men to a man in California. It concluded that the only evidence that the money was obtained through drug trafficking was the parcel’s destination, its recipient, its heavily taped packaging, its priority shipping and a K-9’s alert after sniffing the package.  

Abels argued that the multiple dog alerts to the presence of narcotics on the package in Hodges was not enough for probable cause, however.

“We don't know in this particular case what odor (of controlled substace) … the dog alerted to,” Abels argued. “It could be marijuana, which is legal in many states, and we also don't know when that odor got on the currency. It could have been long before Mr. Hodges was ever in possession of the currency.”

He noted that despite the state’s argument that probative value could be placed on the dog’s alert, no criminal investigation had taken place on individuals involved in the case and no drugs were ever recovered from the package.

Thus, Abels concluded that not enough probative value existed in the case that could authorize seizure under the probable cause standard or the immediately apparent standard.

But state counsel Justin Roebel contended that the dog alerts and excessive amount of cash were enough for probable cause, and that they did not make the package less suspicious.

He argued that the COA’s decision contradicted the overwhelming weight of authority holding that a positive dog sniff establishes probable cause of drug activity.

Roebel continued that the trial court did not abuse its discretion by issuing a turnover order, and based on the circumstances of the case, there was a fair probability that the money was being shipped for an illegal purpose and was evidence of a crime.

“While the Court of Appeals appears to be concerned that a turnover will result in a forfeiture, a turnover hearing is not a forfeiture proceeding,” Roebel wrote in the state’s petition to transfer. “This Court should grant transfer and affirm the trial court’s finding of probable cause.”

“Do we have to disavow Bowman to accept your argument today?” Chief Justice Loretta Rush asked.

Yes, Roebel replied, because Bowman was incorrectly decided and never mentioned the issue of probable cause to begin with. Oral arguments in the case can be viewed here.

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