From the President: The Time Has Come for Forfeiture Reform

Forfeiture reform is long overdue. The Fifth Amendment Integrity Restoration (FAIR) Act would raise the level of proof required to seize property to the more reasonable standard of “clear and convincing evidence,” which would help protect property owners.

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Forfeiture reform is long overdue. Hopefully, it may be coming.On Jan. 27, 2015, on behalf of NACDL, I wrote to all members of Congress urging support of the FAIR Act, the Fifth Amendment Integrity Restoration (FAIR) Act of 2015. This legislation, introduced by Rep. Tim Walberg (R-MI) and Sen. Rand Paul (R-KY), would bring much-needed improvements to federal civil asset forfeiture laws.

Under current law, the government can confiscate money and property of individuals and businesses without convicting, or even charging, that person or entity with committing a crime. As one victim of forfeiture abuse observed, “It’s like they are at war with innocent people.”1 

The FAIR Act would raise the level of proof required to seize property to the more reasonable standard of “clear and convincing evidence,” which would help protect property owners. The FAIR Act would also require the government to prove that an owner was aware that property was being used in criminal activity — an important legal requirement that would help ensure that money and property are not mistakenly or unfairly seized.

This would change two of the more significant problems of current law. First, it would remove the very low burden of proof, or the “preponderance of evidence” standard, permitted by 18 U.S.C. § 983(c). Second, it would cure the problem of taking property of persons who have no responsibility for the property’s criminal misuse, which often occurs when a third party uses property in a way that is beyond the control of the individual who owns the property.

To assure meaningful representation, the bill provides indigent property owners with appointed counsel. Additionally, as currently drafted, the statute would be applicable to “(1) any civil forfeiture proceeding pending on or filed after the date of enactment of this Act; and (2) any amounts received from the forfeiture of property on or after the date of enactment of this Act.”2 

Not as well known to the general public but known to defense lawyers that practice in this area, federal law enforcement agencies have a very strong incentive to seek forfeitures because they have “a direct pecuniary interest in the outcome of the [forfeiture] proceeding[s].”3 As a matter of fundamental due process, the Supreme Court has recognized the need for special scrutiny when the government stands to benefit financially from the imposition of sanctions as a result of criminal laws.4 The FAIR Act would eliminate this profit incentive by prohibiting the Justice Department from retaining assets seized through civil forfeiture for its own use, and instead would mandate that the proceeds of forfeiture go to the Treasury’s General Fund, where Congress can appropriate the money for any purpose.

Additionally, a federal program known as “equitable sharing” allows state and local law enforcement to do an end-run around state laws and profit from civil forfeitures in situations where normally they could not. The proceeds from federal forfeitures are deposited into the Department of Justice’s Asset Forfeiture Fund. After the Department takes its share, “equitable sharing” gives the local police up to 80 percent of the proceeds. This program thwarts any existing state laws that provide better protection to property owners or require forfeited assets to be deposited into the state’s general treasury. To be clear, the financial incentive is staggering: in fiscal year 2012, the federal government paid out almost $700 million in “equitable sharing” proceeds to local and state law enforcement agencies.5 On Jan. 16, 2015, Attorney General Holder restrained one type of equitable sharing that allows federal agencies to “adopt” property that is subject to forfeiture under both federal and state law.6 Although this policy shift is welcome news, it unfortunately does not cure the many problems with the equitable sharing program. Specifically, the new policy does not apply to the overwhelming number of seizures that result from coordinated state-federal investigations. The new policy also does nothing to curtail seizures that take place in the wake of a federal seizure warrant. Therefore, most types of seizures actually do not benefit from the attorney general’s order. The FAIR Act addresses these inequities by abolishing the equitable sharing program altogether.

NACDL cannot ignore the conflicts of interest and policy problems that arise when law enforcement and prosecutorial agencies reap financial bounty from the forfeiture decisions they make. Decisions regarding whose property to seize, and how to deal with citizens whose property has been seized, are too often dictated by the profit the agencies stand to realize from the seizures. State and local law enforcement agencies frequently work with federal agencies on forfeiture cases and share the proceeds of the forfeiture. This procedure thwarts more protective state laws and violates federalism principles. The federal government’s participation in this preemption of state priorities should be eliminated by Congress.

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NACDL, on behalf of its members, has urged Congress to support the commonsense improvements contained in the FAIR Act.

NACDL, Amen!

Notes

  1. The Washington Post published a six-part investigative series highlighting systemic abuses of power in the use of civil asset forfeiture laws by federal, state, and local law enforcement agencies. See Michael Sallah, Robert O’Harrow Jr. & Steven Rich, Stop and Seize, Wash. Post, (2014), http://www.washingtonpost.com/sf/nvestigative/collection/stop-and-seize-2/.
  2. Read the text of the bill at https://www.congress.gov/bill/114th-congress/house-bill/540/text.
  3. United States v. James Daniel Good Real Property, 510 U.S. 43, 56 (1993).
  4. Harmelin v. Michigan, 501 U.S. 957, 979 n.9 (1991) (opinion of Scalia, J.).
  5. Memorandum from Michael E. Horowitz, Inspector General, U.S. Dept. of Justice, Top Management and Performance Challenges Facing the Department of Justice (Dec. 11, 2013), available at www.justice.gov/oig/challenges/2013.htm.
  6. U.S. Dept. of Justice, Att’y Gen. Order, Prohibition on Certain Federal Adoptions of Seizures by State and Local Law Enforcement Agencies, (Jan. 16, 2015). The Attorney General’s office also announced that the U.S. Department of the Treasury will issue a policy consistent with the Attorney General’s order for its own forfeiture program. U.S. Dept. of Justice, Attorney General Prohibits Federal Agency Adoptions of Assets Seized by State and Local Law Enforcement Agencies Except Where Needed to Protect Public Safety (Jan. 16, 2015). Theodore “Ted” Simon is an attorney in private practice in Philadelphia, Pa., where he has based a local, national, state, federal, and international trial and appellate practice representing individuals and corporations. Simon has obtained reversals in the U.S. Supreme Court and in the Pennsylvania Supreme Court. He is a leading authority on the representation of Americans abroad, extradition, and international prisoner transfer. Simon is a Trustee of the Foundation for Criminal Justice. He is also a member of the Board of Directors of Philadelphia’s Jenkins Law Library, America’s first law library.

Theodore Simon
Law Offices of Theodore Simon
1600 Market Street, 14th Floor
Philadelphia, PA 19103
215-563-5550
Fax 215-563-8798
Email  TSimonEsq1@aol.com