Attorney General Holder’s Asset Forfeiture Policy Limiting Federal Adoption Will Not Stop the Abuses

 

Download “Atty. Gen. Holder order limiting federal adoption” AGassetforfetureorder.pdf – Downloaded 12 times – 354 KB

Download “Atty. Gen. Holder press release re: order limiting federal adoption” DOJpress-release-Holder-policy-Fed-Adoption.pdf – Downloaded 9 times – 103 KB

(c) 2015 Brenda Grantland
from Truth and Justice Blog, 1/17/2015

There was widespread rejoicing yesterday when U.S. Attorney General Eric Holder ordered a new policy governing the Asset Forfeiture Program’s “Federal Adoption” program (often known under the broader term, Equitable Sharing).

Immediately after the order was issued, newspapers, non-profit websites, and people on Facebook were celebrating the demise of civil forfeiture as we know it.  Breathless articles were published on the internet and widely reposted, reporting the news based on facts gleaned from other newspaper articles – instead of the policy order itself. [Note: You may download Holder’s policy order and the DOJ press release about it from the Download Attachment links at the top of this page.]

As the story spread, exaggerations grew.  By yesterday afternoon, the hysteria on Facebook was spreading faster than I could post comments debunking the misunderstandings.  Forfeiture victims were asking if they can get their stuff back now.

The problem began with reporters who misunderstood the legal terms used in the order. For example, the web article Amazing! Holder Ends An Asset Seizure Program, which has since been replaced, 1/ said Holder announced the U.S. “was ending the Federal Government’s ‘Equitable Sharing’ program, otherwise known as civil forfeiture.”  Some people took that to mean civil forfeiture had been abolished by Holder’s order – it hadn’t. Equitable Sharing is not the same thing as civil forfeiture.  And Holder’s order was not really about the Equitable Sharing program, but the subdivision of that program known as Federal Adoption.

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 What is Equitable Sharing and Federal Adoption?

Equitable sharing is a process established by federal statutes which rewards state and local police who participate in investigations leading to a federal forfeiture case by giving them a proportionate share of the forfeiture proceeds.

One subset of Equitable Sharing is the “Federal Adoption” program, where federal prosecutors “adopt” property seized by state and local police and prosecute the forfeiture under federal law.  State and local law enforcement agencies are encouraged to seize property and turn it over to the feds for adoption, in exchange for up to 80% of the proceeds of the forfeiture case.  See the DOJ’s Guide to Equitable Sharing for State and Local Law Enforcement Agencies, p. 12. [You can download the dpf of this guide from this link https://www.justice.gov/sites/default/files/usao-ri/legacy/2012/03/26/esguidelines.pdf]

“Any State or local law enforcement agency which participated directly in any of the acts which led to the seizure or forfeiture of the property” is rewarded by transfer to their agency of a portion of the forfeiture proceeds. 18 U.S.C. § 981(e).  The U.S. Department of Justice determines the portion each participating state and local agency will get, “based on the degree of participation in the investigation, usually calculated by the work hours expended.”  Guide to Equitable Sharing, p. 4.

The Federal Adoption program allows the feds to co-opt state and local law enforcement agents and get them to work for the feds, without the federal government having to pay them. Instead they are working basically on a commission – a portion of the proceeds of the forfeiture revenue they generate — with the federal government keeping a portion of the proceeds too.

Federal adoption encourages state and local agencies to seize property even when the state law would not permit forfeiture under the circumstances of the case – in effect, encouraging the state and local police to defy the law of their states and enforce the federal law instead. In some states, the state constitution or statutes do not permit seizing agencies to keep what they seize; instead all forfeiture revenue goes to the general fund or sometimes education.  Other times the statutes give some of the forfeiture proceeds to other state agencies, and the seizing agency would get a larger percentage of the spoils from federal adoption.  Sometimes state forfeiture laws give more due process to property owners, making it more difficult for the government to win a forfeiture under state law.  These are all reasons state and local cops run to the feds and seek the federal adoption process instead of using state forfeiture laws.

The DOJ may also share “up to five percent of the total net forfeiture proceeds with local prosecutors who cross-designate attorneys to handle adoptive and/or joint forfeiture cases in federal court as Special Assistant United States Attorneys.”  Guide to Equitable Sharing p. 5.  (In other words, the feds can also co-opt county prosecutors, and get them to enforce federal laws instead of the state laws they were sworn to uphold, and let them prosecute the federal forfeiture cases against property seized by their local law enforcement brethren.)

The DOJ has complete discretion to decide how to parcel out the proceeds, giving each entity “a value that bears a reasonable relationship to the degree of direct participation of the State or local agency in the law enforcement effort resulting in the forfeiture, taking into account the total value of all property forfeited and the total law enforcement effort with respect to the violation of law on which the forfeiture is based.” 21 U.S.C. § 881(e)(3)(A).

What Holder’s Order Actually Said

I found Holder’s signed order online, and it is not as it was described by the press yesterday.  It is entitled “Prohibition on Certain Federal Adoptions of Seizures by State and Local Law Enforcement Agencies.”  [Note: You may download Holder’s policy order and the DOJ press release about it from the Download Attachment links at the top of this page.] Here is the gist of the order:

Federal adoption of property seized by state or local law enforcement under state last is prohibited, except for property that directly relates to public safety concerns, including firearms, ammunition, explosives and property associated with child pornography.  To the extent that seizures of property other than those four specified categories of property are being considered for federal adoption under this public safety exception, such seizures may not be adopted without the approval of the Assistant Attorney General for the Criminal Division.  The prohibition on federal adoption includes, but it not limited to, seizures by state or local law enforcement of vehicles, valuables, and cash, which is defined as currency and currency equivalents, such as postal money orders, personal and cashier’s checks, store value cards, certificates of deposit, travelers checks and U.S. savings bonds.

This order does not apply to (1) seizures by state and local authorities working together with federal authorities in a joint task force; (2) seizures by state and local authorities that are the result of joint federal-state investigations or that are coordinated with federal authorities as part of ongoing federal investigations; or (3) seizures pursuant to federal seizure warrants, obtained from federal courts to take custody of assets originally seized under state law.  This Order also does not affect the ability of state and local agencies to pursue the forfeiture of assets pursuant to their respective state laws.

Why the Order is Unlikely to Create a Perceptible Reduction in Forfeiture Abuse

1. The Order leaves plenty of wiggle room to get around the restrictions.

Federal adoption is prohibited “except for property that directly relates to public safety concerns,” which includes firearms, ammunition etc. and child pornography — but other types of property including currency can be adopted under the public safety exception so long as they have the approval of the Assistant Attorney General for the Criminal Division.

The order specifically does not apply to joint task forces with one or more federal agents.  That is a huge gaping hole in the policy. More about joint task forces later.  Also, if state and local cops coordinate their investigation with federal agents as part of an ongoing federal investigation, state and local law enforcement seizures may be federally adopted. And if a federal prosecutor really wants to adopt a state seizure, he can rely on the third exception, and just ask the federal judge to approve a federal seizure warrant and they can adopt the state/local seizure. Seizure warrants are obtained ex parte, and generally judges rubber stamp them.

2.  Joint task forces are just as bad as, or worse than, local or state agencies

Regional task forces are set up by “cooperative agreements” between several state and local law enforcement agencies from neighboring jurisdictions and a federal agency such as the DEA. Each participating agency assigns one or more officers from their agency to the task force. They remain employees of their original agency, but under the Cooperation Agreement, state and local agents are “deputized as federal drug agents, thus extending their jurisdiction; state and local participating agencies could receive an equitable share of forfeited drug proceeds; and DEA could pay overtime and investigative expenses for the state and local agencies.”  DEA Programs: State & Local Task Forces.

If the state or local law enforcement agency doesn’t want to end its lucrative forfeiture trap on the freeway, they can turn to state forfeiture law and forfeit the property in state court. Or they can get around the policy change by setting up a DEA joint task force.

“The DEA State and Local Task Force Program provides a federal presence in sparsely populated areas where the DEA would not otherwise be represented.” See DEA Programs.  For a federal agent, being detailed to a task force in a sparsely populated area, to conduct reverse stings to generate forfeiture revenue and seize cash from drivers on the interstate — may not be a very desirable position.  Certainly it is not a position that will attract the best and brightest.  The federal agency would likely be tempted to transfer problem agents to regional task forces to get them out of the agency’s hair.

Having a federal agent on the task force is no guarantee of proper enforcement of the laws.

A more serious problem is — who does the DEA task force answer to?  Certainly not the individual police departments that each member comes from.  Perhaps the DEA agent is answering to his superiors at a DEA regional headquarters somewhere, but it is probably not the close supervision that they would have been subjected to if housed in the DEA office.

I have not had to investigate a regional task force in many years, but in the late 1990s I had a case in which a DEA task force had arrested my clients and brought a camera crew – later revealed to be a crew from the ABC television show “American Detective” — inside my clients house and filmed them under extreme duress, for days on end.  They told my clients they were making a DEA training film and brushed aside my clients’ protests objecting to being filmed.

There was only one federal agent on that task force.  That task force was governed by a Compact, drawn up between the various police agencies involved. From the documents turned over in discovery, it appeared the task force was semi-autonomous.

I blame this sense of semi-autonomy for the agents’ decisions to bring strangers into my client’s home without permission and violate the Fourth Amendment, while lying to my clients about what they were doing – all for the sake of getting themselves on national television. 2/ Perhaps if the agents were under a more secure chain of command, some superior would have had the oversight to stop them from such a flagrant violation of my clients’ rights as well as legitimate law enforcement principles.

3.  A DOJ policy cannot be enforced by private citizens

When an administrative agency official creates an internal policy regulating how the federal agency administers the laws it is charged with enforcing, a citizen cannot sue to enforce it.  Even if the policy was violated in a citizen’s pending forfeiture case, the courts will not allow violation of policy as a defense.  If the official’s underlings refuse to follow the policy, it is the official’s responsibility to force them to comply.

This isn’t the first time that people have rejoiced over a dramatic policy change announced by Holder, only to find out the policy never trickled down to enforcement by U.S. Attorneys.  Several of my clients rejoiced when Holder announced new policies about the enforcement of medical marijuana offenses in states that had legalized medical marijuana.  See the Ogden memo dated October 19, 2009 and the Cole memo dated August 29, 2013. Even I believed at first that Californians charged with medical marijuana related offenses would soon see their cases dismissed, but no discernible change ever came from either memo.

4.  Federal agents can be just as lawless, dishonest and abusive as state and local agents

The fact that agents were hired by the federal government doesn’t make them more fair in their enforcement of the law, or less likely to violate the Constitution, than state or local law enforcement agents.

Having a few federal agents on the task force with the seizing officers will not clean up problems in itself. A lot would depend on how conscientious the federal agent is — but even federal agents fall prey to the blue Code of Silence.  Like criminal conspiracies, where ratting out one’s co-conspirators is a major no-no, likely to be punished by violence, police forces tainted with corruption tend to protect their own fellow agents by not reporting the corruption, and/or taking affirmative steps to cover it up.  That is why the spate of police killings of unarmed black men has resulted in almost no investigations or indictments.

This tiny incremental change of having some federal agents on the task force is shown to be of negligible effect when you consider the fact that ALL civil and criminal forfeitures — whether the initial seizure was by state or federal agents, or a joint task force — are reviewed by attorneys for the U.S. Attorney’s Office before a complaint is filed in federal court.  Granted some unjustified seizures slip through the cracks in the administrative forfeiture process – where a notice of forfeiture is sent out by the DEA or FBI or other federal law enforcement agency, and the property owner misses the deadline. 3/

For the most part, forfeiture cases are reviewed by attorneys from the U.S. Attorney’s Office, who make the decision whether or not to file a forfeiture case in court.  How good this screening mechanism is in ferreting out unjustified seizures depends entirely on the integrity and diligence of the individual Assistant U.S. Attorney.

So Why Did Holder Bother to Order this Policy Change?

There were many more important abuses of the forfeiture laws that Holder’s policy order did not address.  Why did he bother restructuring the Federal Adoption process in such a way that the state and local cops could get around the changes so easily?

Holder was on his way out the door – to be replaced by a new Attorney General, Loretta Lynch, who boasted about having seized $904 million in 2013 alone. If the policy change was substantial it would only be temporary. Holder  was trying to make it look like he was doing something to address the abuses of forfeiture before he left office.

Apparently he was also trying to appease the peasants like us, who have begun clamoring for forfeiture reform.

Civil forfeiture especially has been getting a lot of flak on the television and in print media lately, with most media stories concentrating on the “highway robbery” type of forfeiture abuse.  Journalists love those cases because they are simple and there is a readily obtained graphic to accompany the story – police stop a person traveling down a highway, ask to search the car, the driver says “okay I have nothing to hide” and the police take their money.  No drugs are found, no arrests are made. The property is held for forfeiture and the owner has to jump through hoops to get any portion of it back.

The government would love it if we would believe that those are the only kinds of cases that abuse the forfeiture law, and that only rogue state and local law enforcement agencies are committing crimes against the Constitution.

Those highway robbery cases only represent one type of forfeiture abuse, and a very tiny fraction of the dollar value of property seized which should never have been seized. The most abusive cases I have seen lately are seizures involving hundreds of thousands of dollars, or even millions of dollars in seized property per case, often with numerous innocent victims.  Generally those are commenced by federal law enforcement agencies.

This policy change will not correct the problems because it is not addressing the right problems.

The policy change is more important for its window dressing aspect.  If they give us some symbolic “reform” that doesn’t really mean anything from a practical point of view, they can trick the rest of the public into believing we got what we were asking for and we can just shut up about it.

As we speak, DOJ public relations spin doctors and complicit news media are already declaring the problem solved.  We can all go home now and forget about reforming the forfeiture laws.

This happened before when we finally succeeded in getting CAFRA passed.  Most of the forfeiture reform activists celebrated and quit the movement.

The civil asset forfeiture reform bill that passed as CAFRA had been watered down immensely in the Senate, and riddled with exceptions and vague language inserted in the statute at the insistence of the DOJ. The exceptions and vague language turned out to be Trojan horses, used later by the DOJ and pro-government judges to whittle away the positive reforms of CAFRA by interpreting the statute so that virtually no one qualified for the reforms.

For example, CAFRA’s right to counsel provisions were never really implemented. The right to reimbursement of attorney’s fees for claimants who substantially prevail where whittled away by gerrymandered interpretations of what it means to “substantially prevail” – winning the case may not be enough!  Clever interpretation of a footnote in a Supreme Court decision led a slew of courts to rule that if you settle any portion of a forfeiture case, even the amount of your damages after you win on the merits, you have not prevailed, and therefore are not entitled to reimbursement of your attorney’s fees.

The provision allowing some property, such as cars, to be released to the property owner pending trial, upon a showing of substantial hardship was interpreted so onerously against the property owner that owners almost never qualify. Even though the government is having to store the vehicle for years as it depreciates to a fraction of its value pending trial, with no one getting any use of it, and someone having to pay the storage costs, the government resists every release for substantial hardship just out of principle.  It gives them more leverage for settlement to have the property detained.

Today, almost 15 years after CAFRA passed, it is clear we achieved almost nothing that the DOJ and complicit courts didn’t erase by interpretation or simply ignoring.  Exceptions not written into the text of CAFRA now swallow rules designed to make counsel available to property owners who couldn’t afford to hire a lawyer to defend their property.

The repeal of the cost bond was the only lasting reform brought about by CAFRA.

Clearly more needs to be done now to reform forfeiture laws and it needs to be done soon, before more innocent citizens have their lives destroyed.

The entire asset forfeiture system, state and federal, needs an overhaul – if not abolishment.

Holder’s policy change does not even make a ripple in the ocean of forfeiture abuse that cries out for reform.


1/  The article that replaced it — Attorney General Eric Holder ends most forms of federal asset forfeiture — is similarly misleading.

2/  After the judge dismissed the task force and its agents from our civil rights lawsuit, we settled mid-trial with the television companies, for a substantial sum – but not nearly as much as the network probably made off the episode.

3/  If the property owner misses the 30-day deadline or does not properly comply with the administrative forfeiture procedures, the case is immediately lost by default, and there is no screening of the case by Assistant U.S. Attorneys who make the decision whether or not to charge the property.  The property owner simply loses.

 

Brenda Grantland

Brenda Grantland is a lawyer in Mill Valley, CA, who handles primarily asset forfeiture defense, crime victims' rights, and federal civil and criminal appeals. She is also the author of several books on asset forfeiture and other subjects.

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