New bill in Congress would ban “non-judicial” civil forfeiture

To protect innocent Americans from “legal” police seizures, Representatives Jamie Raskin (D-MD) and Tim Walberg (R-MI) re-introduced a bill on March 9 that would sweep the federal government’s civil forfeiture laws. review. Civil forfeiture allows the government to seize and preserve valuable property without ever convicting the owner of a crime or even filing criminal charges. And under federal law, innocent owners seeking to reclaim their seized property must prove they were not involved in any wrongdoing, upending the presumption of innocence.

In a bitterly divided political landscape, the Fifth Amendment Integrity Restoration Act (HR 1525) is a refreshing display of bipartisanship, with an equal number of Democratic and Republican co-sponsors.

“Taking property and handing it over to the government without evidence of wrongdoing is fundamentally un-American,” said Representative Tony Cárdenas (D-CA), one of the original co-sponsors of the FAIR Act. “In the United States, we are innocent until proven guilty, and the government cannot seize our property without just cause. It is time to reform our civil forfeiture system and make it fairer to the American people.”

First, HR 1525 would eliminate the most abusive form of civil forfeiture: administrative or “non-judicial” forfeiture, which somehow offers even less protection. Instead of an independent, neutral judge hearing the case, the seizing authorities themselves decide whether to forfeit the property. That’s a blatant conflict of interest, especially since federal law allows agencies to keep up to 100% percent of the proceeds from forfeited property.

Failure of an owner to file a claim quickly enough results in a “default judgment” where the seized property is automatically forfeited to the federal government. Aside from real estate and assets worth more than $500,000, almost any property can be seized through non-judicial forfeiture.

Given such a stacked deck, it’s no surprise that federal agencies overwhelmingly favor administrative forfeiture. According to a report by the Institute for Justice, 78% of all forfeiture cases handled by the United States Department of Justice were administrative. In other words, barely one-fifth of Justice Department forfeiture cases had any judicial oversight.

The rates are even more dire for other federal departments. At the Treasury Department and the Department of Homeland Security, administrative forfeitures accounted for 96% and 98.6% of their total forfeiture files, respectively. By allowing forfeiture only “through legal process”, the FAIR Act would effectively end the legal shortcut used to handle nearly all civil forfeiture cases at the federal level.

“Innocent until proven guilty has little meaning if law enforcement can seize your assets before you ever appear in court on a criminal charge,” noted Rep. Kelly Armstrong (R-ND), who also co-sponsored the FAIR Act, op.

In addition to requiring real judges to hear forfeiture cases, the bill would add several new safeguards to further protect due process. The FAIR law would put the burden of proof squarely on the federal government – ​​where it belongs – and would also require “clear and convincing evidence” that a seized property was related to criminal activity. Currently, federal agencies can permanently seize property based on a “preponderance of the evidence,” that is, more likely than not, a much lower standard of proof.

Since many property owners lack the resources to fight an expensive legal battle to reclaim what has been looted, the FAIR Act would also guarantee legal representation to those who cannot afford it.

Crucially, HR 1525 would eliminate the financial incentives that drive so many forfeiture cases. If passed, all proceeds from forfeiture would be diverted from the treasury of federal agencies and instead deposited into the Treasury’s general fund. Since 2000, the Justice Department and Treasury Department have forfeited more than $50 billion.

In addition, the FAIR Act would limit many wrongful seizures at the state and local levels by ending a federal program known as “equitable distribution.” Under equitable distribution, state and local law enforcement agencies can work with the federal government, forfeit property under federal law, and then keep up to 80% of the proceeds.

In other words, an equitable distribution rewards police and prosecutors who circumvent the stricter civil forfeiture limits set by state law. And the program can be incredibly lucrative. Over the past two decades, the federal government has disbursed more than $8.8 billion in equitable funding to state and local agencies.

Marine veteran Stephen Lara encountered this firsthand. While driving to California in February 2021 to see his two children, Stephen was pulled over by the then-Nevada Highway Patrol. While carrying cash and distrusting banks are not crimes, troopers confiscated his entire life savings – nearly $87,000. It took Stephen over 20 years to cut back and save that money, including during tours of duty serving in Afghanistan and Iraq.

Stephen has never been charged with a crime. Officers didn’t even issue him a traffic fine.

After taking Stephen’s money, Nevada state troopers kicked his case over to the DEA to proceed with equitable distribution. Since Nevada needs clear and convincing evidence to forfeit property in civil court, it would be easier for the agencies to win under federal law.

Thankfully, after the Institute for Justice filed a lawsuit on Stephen’s behalf and sparked a national firestorm, the DEA agreed to return Stephen’s money in October 2021. His lawsuit against the Nevada State Police is still pending.

While equitable distribution was initially pitched as a way to fight crime, after analyzing clearance rates across thousands of different agencies, a study by the Institute for Justice concluded that “more equitable distribution of funds does not translate into more crimes solved.” But there was evidence that “during periods of fiscal stress” police used forfeiture to “generate revenue”.

“Protecting Americans’ property rights is not a partisan issue, and we’re pleased to see legislators across the board working together to deliver real reform,” said Institute for Justice Senior Attorney Dan Alban, chief of IJ’s National Initiative to End Forfeiture Abuse.